Escorts Kubota Limited has received a GST tax demand of Rs. 10,02,652 along with a penalty of Rs. 10,02,652 from tax authorities in Madhya Pradesh. The company disclosed this development in a regulatory filing dated March 28, 2026, in compliance with SEBI listing regulations.

GST Demand Details

The State Tax Officer of GST, Bhopal Division-1, Madhya Pradesh, issued an order on March 28, 2026, confirming the tax demand along with applicable interest. The demand stems from the generation of duplicate E-way bills, which the company attributes to a technical bug on the portal.

Company's Response

Escorts Kubota Limited has indicated its intention to challenge the order by filing an appeal before the appellate authority. The company maintains that the issue arose due to a technical bug on the GST portal, which led to the generation of duplicate E-way bills.

Regulatory Compliance

The disclosure was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company provided detailed information as required under Para A (20) of Schedule III of SEBI Listing Regulations, including the nature of the violation, financial impact, and timeline of events.

Key Compliance Details

The company has fulfilled its regulatory obligations by promptly disclosing this material event to both BSE and NSE, ensuring transparency for investors and stakeholders regarding the GST demand and its planned course of action.

Escorts Kubota Limited has secured a major victory in its tax dispute with Chennai authorities, as the State Tax Officer dropped a substantial tax demand of Rs 46.79 crores for Financial Year 2019-20. The company announced this development through a regulatory filing dated March 27, 2026, marking the complete resolution of a prolonged tax controversy.

Tax Demand Resolution Details

The State Tax Officer, Mandaveli Assessment Circle, Chennai, Tamil Nadu, passed an order on March 26, 2026, dropping the entire tax demand along with associated interest and penalty. This decision represents a complete vindication of the company's position in the dispute.

Background of the Dispute

The tax controversy originated from Show Cause Notices dated May 07, 2025, issued by the Chennai tax authorities. Escorts Kubota had been contesting these demands on two primary grounds that highlighted fundamental errors in the tax assessment process.

The company's objections centered on:

• Wrong classification: Tax authorities incorrectly classified agricultural tractors as road tractors
• Computation error: Alleged tax was calculated on total GST turnover instead of only tractor turnover

Regulatory Compliance and Timeline

Escorts Kubota has maintained transparent communication with stakeholders throughout this process, filing multiple updates under Regulation 30 of SEBI Listing Regulations. The company had previously submitted intimations on May 08, 2025, December 30, 2025, and January 30, 2026, keeping investors informed about the dispute's progress.

Impact and Significance

This resolution eliminates a significant contingent liability from the company's books and provides clarity on the tax treatment of agricultural tractors versus road tractors. The favorable outcome validates Escorts Kubota's technical and legal position regarding product classification and GST computation methodology.

The company has fulfilled all disclosure requirements pursuant to SEBI Master Circular and provided detailed annexures outlining the complete resolution of proceedings with the Chennai tax authorities. This development removes regulatory uncertainty and allows the company to focus on its core business operations without the overhang of this substantial tax demand.