Smartlink Holdings Limited disclosed that its material subsidiary, Digisol Systems Limited, has been served a Show Cause Notice (SCN) by the State Tax Officer of the Maharashtra Goods and Services Tax Department. The SCN, dated September 28, 2026, demands ₹1.76 crore in GST for the fiscal year 2023.

The notice was received by Digisol on October 5, 2026, and subsequently intimated to the parent company on the same day. The regulatory filing was made under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Nature of the Discrepancy

The SCN was issued following a scrutiny of Digisol’s GST returns for the tax period April 2022 to March 2023. The authority identified two primary irregularities:

1. Excess outward tax reported in GSTR-1 compared to GSTR-9, resulting in a proposed tax liability of ₹1,66,717.29.
2. Excess Input Tax Credit (ITC) availed in GSTR-3B/GSTR-9 that was not confirmed in GSTR-2B/GSTR-2A, leading to a proposed tax liability of ₹1,74,74,992.52.

Financial Implications

The total liability proposed in the SCN includes the base GST demand, interest, and penalty. The breakdown is as follows:

The GST demand comprises IGST of ₹1,75,00,541, CGST of ₹84,316, and SGST of ₹84,316. Digisol has been called upon to show cause as to why this liability should not be levied under Section 73/74 of the MGST/CGST Act, 2017.

What the Numbers Show

The financial exposure extends significantly beyond the headline GST demand figure. When combining the principal tax demand with the proposed interest and penalty, the total potential liability exceeds ₹3.35 crore. This aggregate figure is nearly double the principal tax amount cited in the initial disclosure, highlighting the compounding effect of statutory interest on delayed compliance issues.

Company Response

Smartlink Holdings stated that there is no immediate impact on the financial, operational, or other activities of Digisol or the Company solely upon receipt of the SCN. The final financial impact will depend on the outcome of the proceedings. Digisol is currently studying the notice and preparing a detailed reply with facts, figures, and justifications to submit within the prescribed timelines.

Pradeep Anant Rane has ceased to be an Independent Director of smartlink holdings on August 04, 2026, following the completion of his second consecutive term. The departure is a routine succession event mandated by corporate governance norms regarding director tenure limits. The Board of Directors and management expressed deep appreciation for Mr. Rane’s invaluable contributions during his time on the Board.

The disclosure was made pursuant to Regulation 30 read with Schedule III of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company also referenced SEBI Master Circular HO/49/14/14(7)2025-CFD-POD2/I/3762/2026, dated January 30, 2026, in its filing to the stock exchanges.

Director Tenure Details

The change reflects standard compliance with listing regulations that cap the tenure of independent directors to ensure board refreshment and diversity of thought. No other changes to the Board composition were disclosed in this filing.

What This Means for Governance

The exit of Mr. Rane highlights the company’s adherence to regulatory frameworks governing independent director tenures. Under SEBI norms, independent directors can serve for a maximum of two terms, each term being five years. Mr. Rane’s departure on August 04, 2026, indicates he has served the maximum allowable period. The company will need to appoint a new independent director to fill this vacancy in accordance with the Companies Act and SEBI Listing Regulations, ensuring the Board maintains the required proportion of independent members.