Indian Overseas Bank has received a significant income tax demand notice from the National Faceless Assessment Centre (NFAC) for Assessment Year 2024-25. The public sector lender disclosed through a regulatory filing that it has been served with a demand totaling ₹1,742.96 crore on March 27, 2026.

Official Regulatory Disclosure

The bank made the disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The assessment order was issued under Section 143(3) read with Section 144B of Income Tax Act, 1961 by the National Faceless Assessment Unit (NFAC) of the Income Tax Department.

Nature of Tax Assessment

The demand pertains to re-computation of income and disallowances made with regard to claims made in the income tax returns for Assessment Year 2024-25. The substantial amount reflects the scale of the tax authority's assessment of the bank's tax obligations for the relevant period under the faceless assessment scheme.

Bank's Response and Legal Strategy

Indian Overseas Bank has indicated its intention to challenge the income tax demand order through appropriate legal remedies. The bank is in the process of filing an appeal before the appropriate forum against the disallowances and additions made in the assessment order within prescribed timelines.

Financial Impact Assessment

Despite the substantial quantum of the tax demand, Indian Overseas Bank has stated that it expects no financial impact from this development. The bank believes it has adequate factual and legal grounds to reasonably substantiate its position in the matter. Based on precedence and orders of appellate authorities, the bank expects that the entire demand will subside, with no impact anticipated on financial, operations or other activities.

Indian Overseas Bank has received a substantial income tax demand notice of ₹642.74 crores for Assessment Year 2016-17, as disclosed under Regulation 30 of SEBI Listing Obligations and Disclosure Requirements Regulations 2015. The bank received this communication on 26.03.2026 from the Joint Commissioner of Income-tax (in-situ), Non-Corporate Circle-8, Chennai.

Income Tax Demand Details

The demand stems from a Giving Effect order to ITAT Order ITA No. 202 & 253/Chny/2023 dated 31.12.2024 under Section 254 read with Section 143(3) of Income Tax Act, 1961. The following table summarizes the key details of the tax demand:

Bank's Response Strategy

Indian Overseas Bank has indicated it will contest the entire demand through appropriate legal channels. The bank stated it is in the process of challenging the order within prescribed guidelines, citing disallowances and additions made in the assessment order. According to the disclosure, the bank expects no financial implications as it plans to dispute the entire demand.

Expected Financial Impact

The bank has declared nil expected financial implications, stating it will be disputing the entire demand. The disclosure indicates that based on precedence and orders of appellate authorities, the bank believes it has adequate factual and legal grounds to substantiate its position. The bank expects the entire demand will subside, with no impact anticipated on financial, operations, or other activities.

Regulatory Compliance

The disclosure was made in compliance with Regulation 30(13) of SEBI LODR Regulations, which requires listed entities to inform stock exchanges about communications from regulatory, statutory, enforcement, or judicial authorities. The communication was signed by Raghuram Mallela, Deputy General Manager/Company Secretary & Compliance Officer, ensuring proper corporate governance protocols were followed.

Nature of Tax Dispute

The demand relates to re-computation of income and disallowances made regarding claims in the income tax returns for Assessment Year 2016-17. No penalties, restrictions, or sanctions have been imposed pursuant to this communication, as indicated in the regulatory disclosure form.