Urban Company has received a show cause notice from the Excise & Taxation Officer of State Tax, Proper Officer, SGST, Gurugram (East-2). The notice alleges incorrect availment of input tax credit and short payment of tax for FY23, demanding a total of ₹3.05 crore.

The communication was received on September 29, 2026, at 3:49 pm. The demand is raised under Section 73(1) of the CGST Act, 2017 and the HGST Act, 2017, read with Section 20 of the IGST Act, 2017 and Section 65(7).

Breakdown of the Demand

The total demand of ₹3,04,65,203 comprises three components related to the financial year 2022-23:

The interest component covers the period spanning FY23 through FY26.

Company Response and Impact

Urban Company stated that it duly claimed input tax credit in accordance with the provisions of the GST Act. The company asserts there is no wrong availment of input tax credit or short payment of tax. It believes it has a strong case on merits, supported by the opinion of its external legal and tax advisors. The company will respond to the notice within the prescribed timelines.

Regarding the impact on operations, Urban Company disclosed that the show cause notice will not impact its financial, operational, or other activities. This disclosure was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Urban Company Limited saw a reduction in institutional ownership as Bessemer India Capital Holdings II Ltd. sold 25,151,118 equity shares, representing 2.12% of the company's share capital. This transaction lowered Bessemer’s total holding from 5.54% to 3.42%.

The disclosure was filed under Regulation 29(2) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. The sale was executed through open market transactions on stock exchanges, including a specific block deal on August 13, 2026. The tranches were sold over a period extending to September 23, 2026.

Transaction details and timeline

The seller, Bessemer India Capital Holdings II Ltd., is not part of the promoter or promoter group. The filing confirms that the pre-sale holding stood at 77,910,684 shares (5.54%). Following the disposal of 25,151,118 shares, the residual holding is 52,759,566 shares.

The mode of sale was primarily open market sales, with the inclusion of a block deal on August 13, 2026. The total equity share capital of Urban Company remained unchanged at 1,542,180,603 equity shares of ₹1 each, based on the shareholding pattern as of June 30, 2026.

What the numbers show

A notable divergence exists between the percentage change reported in the SAST disclosure (2.12%) and the actual proportion of current paid-up capital sold (1.63%). The filing attributes this discrepancy to an increase in Urban Company’s paid-up share capital since the reference date used for the pre-sale calculation. While the absolute number of shares sold represents 1.63% of the current capital base, the regulatory percentage reflects the change relative to the earlier recorded position, highlighting how capital structure changes can impact disclosed ownership metrics.