JK Paper Limited has secured a significant victory in its tax appeal, with the Commissioner of Income Tax (Appeals), Ahmedabad, deleting the entire demand of Rs 49.53 crore that was raised against the company for Assessment Year 2022-23. The appellate order, dated March 27, 2026, represents a complete reversal of the Income Tax Officer's original assessment.

Background of the Tax Dispute

The tax controversy originated from an assessment order for Financial Year 2021-22 (Assessment Year 2022-23), where the Income Tax Officer had made additions to the company's income. This resulted in an aggregate demand of Rs 49.53 crore, which included interest of Rs 15.19 crore. The company had previously disclosed this development on May 21, 2025, and subsequently filed an appeal before the Commissioner of Income Tax (Appeals).

Appellate Order Details

The key details of the appellate proceedings are outlined below:

Financial Impact and Implications

The appellate order has significant positive financial implications for JK Paper Limited. The Commissioner of Income Tax (Appeals) has deleted all additions made to the company's income by the Income Tax Officer in the original assessment order. Consequently, the entire demand of Rs 49.53 crore, including the interest component of Rs 15.19 crore, will be deleted by the Income Tax Officer.

Company's Position and Compliance

JK Paper Limited has maintained throughout the proceedings that its tax positions are in accordance with applicable laws. The company has stated that it does not anticipate any material adverse impact on its financials, operations, or other activities pursuant to this favorable order. No penalties, restrictions, or sanctions were imposed, and no aberrations or non-compliances were identified by the authority.

Regulatory Disclosure

The company has fulfilled its disclosure obligations under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The disclosure was made pursuant to SEBI Circular No. SEBI/HO/CFD/CFD-PoD-2/P/CIR/2025/25 dated February 25, 2025, in continuation of the company's earlier communication regarding the initial tax assessment. Company Secretary and Compliance Officer Pradeep Joshi signed the disclosure documents on March 28, 2026.

JK Paper Limited has completed the allotment of 1,19,16,422 equity shares to its promoter group constituents under a scheme of arrangement approved by the National Company Law Tribunal. The allotment, executed on 20th March, 2026, follows the NCLT Ahmedabad Bench order dated 3rd February, 2026, which became effective on 15th March, 2026.

Share Allotment Details

The equity shares of ₹10 each were distributed between two promoter group entities. Accurate Finman Services Limited received 18,66,431 shares, while J.K. Credit & Finance Limited was allotted 1,00,49,991 shares. This allotment was made pursuant to the court-sanctioned scheme of arrangement.

Impact on Promoter Holdings

Following the share allotment, the total shareholding of the promoter and promoter group constituents increased significantly. The combined promoter group holding rose to 9,59,96,633 equity shares, representing an increase of 3.31% in their overall stake.

Pre and Post-Allotment Holdings Comparison

Company Capital Structure Changes

The allotment resulted in an expansion of JK Paper's equity share capital. The company's total equity share capital increased from ₹1,69,40,23,440 to ₹1,81,31,87,710. The total number of outstanding equity shares rose from 16,94,02,344 to 18,13,18,771 equity shares of ₹10 each, all fully paid up.

Regulatory Compliance

Bengal & Assam Company Limited, acting as the promoter, filed the requisite disclosure under Regulation 29(2) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 2011. The disclosure was submitted to both BSE Limited and National Stock Exchange of India Limited, where JK Paper's shares are listed. The company secretary Dillip Kumar Swain signed the disclosure on behalf of Bengal & Assam Company Limited and other promoter group constituents.