Refex Industries Limited has secured a major legal victory with the Hon'ble Madras High Court quashing an Income Tax demand of ₹3,567.22 lakh for Assessment Year 2016-17. The company received the court order on April 28, 2026, which has nullified the entire tax demand and provided significant financial relief.

Background of the Tax Dispute

The controversy originated from an assessment order dated May 31, 2023, issued by the Deputy Commissioner of Income Tax - Central Circle 3(4), Chennai. The assessment pertained to AY 2016-17 and involved a substantial demand of ₹3,567.22 lakh against the company.

Legal Challenge and Court Proceedings

Refex Industries filed a writ petition before the Hon'ble Madras High Court challenging the assessment order on substantial procedural grounds. The company's legal challenge was based on two primary arguments that the assessment order was passed without providing reasonable opportunity of being heard as mandated under Section 144A of the Income Tax Act, 1961, and no appropriate approval was obtained for issuing the notice.

These procedural lapses formed the cornerstone of the company's legal strategy in challenging the tax demand, highlighting significant violations in the assessment process.

Court's Decision and Financial Impact

After considering the submissions made by both parties, the Hon'ble Madras High Court ruled in favor of Refex Industries and set aside the assessment order passed by the Assessing Officer. The court's comprehensive decision addressed the procedural violations cited by the company, resulting in the complete nullification of the tax demand.

Regulatory Compliance and Disclosure

The company has disclosed this development under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The disclosure was made in compliance with SEBI Master Circular bearing reference no. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated January 30, 2026.

Company Secretary and Compliance Officer Ankit Poddar signed the official disclosure on behalf of Refex Industries Limited, confirming that the tax demand of approximately ₹3,567.22 lakh stands nullified following the favorable court order.

This favorable court ruling represents a significant legal and financial victory for Refex Industries, eliminating a substantial tax liability and validating the company's position on the procedural aspects of the assessment process.

Refex Industries Limited has successfully completed the acquisition of additional equity shares in its subsidiary Venwind Refex Power Limited (VRPL) through a rights issue transaction completed on April 25, 2026. The transaction, disclosed under Regulation 30 of SEBI Listing Regulations, resulted in changes to the company's shareholding structure in its power sector subsidiary.

Rights Issue Transaction Details

The rights issue involved VRPL allotting 1,712 equity shares to Refex Industries and other shareholders. The transaction structure included shares with a face value of ₹10 each, offered at a premium of ₹17,513 per share. The total value of the rights issue amounted to ₹2,99,99,376.

Shareholding Changes and Impact

Following the rights issue, Refex Industries' shareholding in VRPL initially changed from 77.77% to 76.81%. However, subsequent conversion of Class A Optional Convertible Debentures (OCDs) by other debenture holders further diluted the company's stake. Refex Industries was not a party to the OCD conversion transaction.

Subsidiary Profile and Capital Structure

Venwind Refex Power Limited operates in the power and energy industry with a focus on wind power and allied sector activities. The subsidiary was incorporated on December 20, 2024, making it a relatively new entity within the Refex group structure.

Capital Structure Changes

Strategic Objectives

The rights issue was undertaken with the objective of augmenting the capital base of Venwind Refex Power Limited and facilitating its future growth and operational expansion in the renewable energy sector. The transaction represents a related party transaction as VRPL is a subsidiary of Refex Industries, conducted in accordance with applicable provisions of the Companies Act, 2013 and relevant regulatory guidelines.

The completion of this rights issue strengthens VRPL's financial position while maintaining Refex Industries' majority control in the subsidiary, supporting the group's expansion in the wind power segment of the renewable energy sector.