Kalpataru Projects International Limited has disclosed receiving a penalty order from the GST Authority demanding ₹57.59 lakhs for alleged Input Tax Credit irregularities spanning five financial years from 2019-20 to 2023-24.

GST Authority Order Details

The company received the order on March 28, 2026, at approximately 4:14 PM IST under the provisions of Sections 74 and 122 of the Central Goods and Services Tax Act, 2017, along with relevant provisions of the State Goods and Services Tax Act, 2017.

Company's Response and Legal Action

Kalpataru Projects International has expressed confidence in defending the matter, stating that the order was issued without considering the company's reply and documentary evidence submitted to the authority. The company plans to file an appeal before the Appellate Authority within the prescribed timelines.

The GST Authority has demanded tax, interest, and penalty based on allegations of improper Input Tax Credit practices during the specified period. The company maintains it has substantial grounds to challenge the order through the appellate process.

Financial Impact Assessment

According to the company's disclosure, the penalty amount does not have any significant impact on its operations or financial position. The disclosure was submitted on the first working day following receipt of the order, in compliance with regulatory requirements under Regulation 30 of SEBI's Listing Obligations and Disclosure Requirements Regulations, 2015.

The company has formally communicated this development to both BSE Limited and National Stock Exchange of India Limited as part of its mandatory disclosure obligations to keep stakeholders informed of material developments.

Kalpataru Projects International has raised concerns about its Middle East operations, highlighting significant exposure risks that could impact the company's near-term financial performance. The infrastructure and power transmission company has identified potential challenges in the region that warrant investor attention.

Order Book Risk Assessment

The company has flagged substantial exposure to Middle East operations, with management indicating that a significant portion of its order book faces potential risks. The infrastructure major has specifically warned about challenges that could affect project execution and revenue recognition in the region.

Expected Financial Impact

Kalpataru Projects has provided guidance on the anticipated financial implications of its Middle East exposure. The company expects a notable impact on its revenue performance, particularly in the fourth quarter.

Regional Challenges

The warning comes amid ongoing challenges in the Middle East region that could affect infrastructure and construction projects. The company's assessment reflects the complex operating environment that international infrastructure companies face in the region, including potential project delays and execution risks.

The disclosure demonstrates the company's proactive approach to risk management and transparency with stakeholders regarding potential headwinds. Investors will be closely monitoring how the company navigates these regional challenges and their impact on overall business performance.