Eureka Forbes has received a show cause notice from the Uttar Pradesh GST authority alleging a total liability of ₹273.40 crore for FY23. The company intends to contest the notice, stating it is devoid of merits and sustainable facts.

The notice was issued under Section 73(1) of the Uttar Pradesh Goods and Services Tax Act, 2017, by the Deputy Commissioner, State Tax, Sector-1, Lucknow. It was received on September 25, 2026, after office hours, with the disclosure made on the next working day, September 28, 2026.

Breakdown of Alleged Liability

The regulatory filing details the specific components of the disputed amount. The authority claims a base tax liability along with accrued interest and penalties.

Company's Response and Legal Stance

Eureka Forbes stated that the proposed demand appears to have been computed using pan-India level financial information from its signed financials for FY23. The company argued that this approach failed to establish corresponding transaction-level liability attributable specifically to its Uttar Pradesh GST registration.

The management maintains that the notice is not sustainable in law or procedure. Consequently, the company plans to contest the matter comprehensively within prescribed timelines. Eureka Forbes does not envisage any material impact on its financials, operations, or other activities arising from this development.

What the Numbers Show

The composition of the alleged liability reveals a significant weight of non-tax components. Interest and penalties together account for ₹124.19 crore, which constitutes approximately 45% of the total claimed amount. This high proportion suggests the dispute hinges heavily on the duration of the alleged non-compliance and the statutory application of interest rates, rather than solely on the principal tax assessment.

Lunolux Limited has pledged an additional 22,319,748 equity shares of Eureka Forbes Limited , increasing the total encumbered stake to 51.00% of the issued and paid-up share capital.

The creation of this subsequent pledge occurred on September 15, 2026, through the depository system. Catalyst Trusteeship Limited disclosed the transaction on September 17, 2026, acting as the onshore security agent for lenders under a restated facility agreement with Lunolux.

Pledge Details and Encumbrance

The new pledge covers 11.53% of the target company's issued and paid-up share capital. This addition follows earlier encumbrances created by Lunolux:

• Initial Pledge: 64,950,000 shares (disclosed May 9, 2024)
• Top-Up Pledge: 11,418,729 shares (disclosed July 30, 2026)

Catalyst Trusteeship Limited holds these shares as pledgee for the benefit of overseas banks and eligible lenders, in compliance with Reserve Bank of India guidelines. The trustee clarified it holds no beneficial interest in the pledged shares.

Facility Restatement Context

The pledge was created pursuant to an amendment and restatement agreement dated September 15, 2026, between Lunolux and CSCGlobal Capital Markets (Singapore) Pte. Ltd. This agreement modified the original facility dated May 1, 2024, to extend the tenor and increase the total commitment.

What the Numbers Show

The cumulative pledge of 98,688,477 shares represents more than half of Eureka Forbes' voting power. With the diluted encumbrance standing at 47.34%, the promoter group's collateral exposure remains significant relative to the company's total equity base of 19,35,06,816 shares.