Rashtriya Chemicals & Fertilizers Limited has secured a significant legal victory with the Supreme Court of India setting aside orders from the Customs Excise and Service Tax Appellate Tribunal (CESTAT) in a case spanning nearly three decades. The company announced this development through a regulatory filing under SEBI LODR Regulations on March 25, 2026.

Supreme Court Ruling Details

The Supreme Court of India, through its order dated March 24, 2026, set aside the impugned orders-in-original dated January 27, 2010 and February 4, 2010, as well as the order passed by CESTAT's West Zonal Bench in Mumbai. The case involved appeals filed by the company against various show cause notices and orders for the period from 1996 to 2005.

Financial Impact and Allegations

The Supreme Court's favorable ruling eliminates a substantial financial burden for the fertilizer manufacturer. The case involved allegations of excise duty violations related to the diversion of Naphtha for purposes other than fertilizer production.

Regulatory Compliance

The company has fulfilled its disclosure obligations under Regulation 30 of SEBI LODR Regulations by informing both BSE Limited and National Stock Exchange of India Limited about this significant legal development. The notification was signed by J.B. Sharma, Executive Director (Legal & Company Secretary), ensuring proper corporate governance protocols were followed.

Case Background

The legal dispute originated from excise demands raised by authorities regarding the alleged diversion of Naphtha for non-fertilizer use during the period 1996 to 2005. The original orders were passed in 2010, and the company had been pursuing appeals through various judicial forums before reaching the Supreme Court. The favorable verdict represents the culmination of a prolonged legal battle spanning over 15 years since the original orders were issued.

Rashtriya Chemicals & Fertilizers Limited has received periodic credit rating monitoring results from ICRA Limited for its comprehensive portfolio of financial instruments. The company notified stock exchanges on March 24, 2026, regarding the rating actions taken by ICRA's Rating Committee on March 20, 2026, covering facilities worth Rs. 9,300.00 crore.

Credit Rating Overview

ICRA Limited conducted periodic monitoring of the company's credit ratings across multiple financial instruments, reaffirming strong ratings across all categories. The rating agency issued three separate letters dated March 20, 2026, covering different instrument categories.

Detailed Facility Breakdown

The rating covers various banking relationships and facilities across multiple financial institutions. The term loan facilities of Rs. 3,500.00 crore are distributed among several banks including HDFC Bank Limited with Rs. 2,200.00 crore, Emirates NBD Bank PJSC with Rs. 300.00 crore, CTBC Bank Co. Limited with Rs. 168.00 crore, Axis Bank Limited with Rs. 144.00 crore, and State Bank of India with Rs. 121.00 crore. Additionally, proposed term loans worth Rs. 567.00 crore are included in the rating.

Commercial Paper Conditions

For the commercial paper facility rated at Rs. 3,000.00 crore with ICRA A1+ rating, ICRA Limited has specified important conditions:

• Revalidation required if instrument not issued within 3 months from March 20, 2026
• Rating validity throughout the program life with maximum maturity of twelve months from issuance date
• ICRA reserves rights to review and revise ratings based on new information or circumstances

Regulatory Compliance

The disclosure was made pursuant to Regulation 30(6) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company's Executive Director (Legal & Company Secretary) J.B. Sharma signed the communication to both BSE Limited and National Stock Exchange of India Limited, ensuring compliance with stock exchange notification requirements.

Rating Continuity

ICRA Limited confirmed that other terms and conditions for the credit ratings remain unchanged from previous communications dated July 17, 2025. This continuity indicates stable credit assessment and consistent financial performance evaluation by the rating agency. The periodic monitoring reflects ICRA's ongoing assessment of the company's creditworthiness and financial stability as a Government of India undertaking.