H.G. Infra Engineering Ltd received a show cause notice from the Karnataka tax authority demanding ₹94,00,00,328 in GST liabilities on September 16, 2026. The notice stems from audit proceedings for FY23.

The Deputy Commissioner of Commercial Taxes, Bengaluru, issued the notice under Section 73(1) of the Central Goods and Services Tax Act, 2017 and the Karnataka Goods and Services Tax Act, 2017. The allegations concern input tax credit claims and discrepancies between turnover reported in GST returns and financial statements.

Regulatory Disclosure

The company disclosed the receipt of the notice pursuant to Regulations 30 and 51 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The disclosure was signed by Ankita Mehra, Company Secretary and Compliance Officer.

Company Response

H.G. Infra Engineering stated that it believes the observations and proposed amounts are not sustainable on facts or law. The company does not foresee any material financial impact at this stage. It plans to file a response with proper documentation before the Assessing Authority and expects a favorable outcome based on the merits of the matter.

What the Numbers Show

The aggregate liability of ₹94,00,00,328 relates specifically to FY23 audit proceedings. While the amount is significant, the company’s preliminary assessment suggests the legal basis for the demand is weak. The actual financial impact remains contingent on the adjudication outcome rather than being an immediate cash outflow.

H.G. Infra Engineering Ltd paid ₹18.43 crore in interest on its non-convertible debentures (NCDs) on August 31, 2026, covering the period ended August 2026.

The capital goods firm complied with Regulation 57 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, by confirming the timely settlement of dues to its debenture holders.

Interest Payment Details

The company issued 40,000 Senior Rated Listed Unsecured Redeemable NCDs worth ₹400 crore via private placement. Each debenture has a face value of ₹1 lakh. The interest payment was scheduled for August 29, 2026, but was made on August 31, 2026, adhering to the "Business Day Convention" agreed in the financing arrangement.

Penalty Component Analysis

The total interest outlay of ₹18.43 crore exceeded the base interest liability of ₹17.05 crore by approximately ₹1.38 crore. This difference represents a 2% penal interest charged by the debenture holder.

The penalty stems from a breach of covenant during the quarter ended March 31, 2026. The last regular interest payment before this period was made on March 2, 2026. The inclusion of this penalty highlights a specific compliance cost associated with the earlier covenant breach, adding nearly 8% to the standard semi-annual interest burden.

Regulatory Compliance

Ankita Mehra, Company Secretary and Compliance Officer of H.G. Infra Engineering Ltd, digitally signed the certification on August 31, 2026. The company confirmed there were no delays in the current payment cycle beyond the agreed business day convention adjustment.

A copy of the certificate was sent to Catalyst Trusteeship Limited, the designated Debenture Trustee.