DCM Limited , a diversified company with interests in IT services, real estate, and engineering, has successfully concluded its Punjab VAT dispute settlement. The company received the final settlement order on December 30, 2025, marking the complete resolution of a long-standing litigation matter.

Settlement Completion Details

The company has fully settled its VAT dispute with Punjab authorities under the One Time Settlement Scheme (OTSS) notified by the Punjab Government on September 30, 2025. The final settlement order was received from the company's attorney on December 30, 2025, at 3:27 PM, concluding the matter entirely.

Background of the Dispute

The dispute originated from the disallowance of Entry Tax credit on High Speed Diesel (HSD) by the Assistant Commissioner of Sales Tax, Ropar. The matter involved DCM Limited's engineering division's tax returns for financial years 2010-11 through 2013-14, where the department challenged the input tax credit claims under the Punjab Value Added Tax Act, 2005.

The company had strong legal grounds for its position, arguing that:

• Section 13(5)(b) restrictions apply only to VAT on intra-state purchases, not entry tax from other states
• Entry tax paid under Section 3A was deemed advance tax under Section 6(7) and 6(8) of PVAT Act
• Entry tax and advance tax were never levied simultaneously

Strategic Decision and Board Approval

Despite legal advice indicating strong merit in the case, DCM Limited's Board of Directors approved the settlement on November 12, 2025. The decision was driven by:

Financial Impact and Implications

The settlement represents a significant financial benefit for DCM Limited. By paying Rs. 113.89 lakhs, the company has resolved total dues of Rs. 812 lakhs, achieving savings of approximately Rs. 698 lakhs. This resolution eliminates contingent liabilities and provides clarity to the company's financial position.

The settlement comes at a strategic time as DCM Limited continues to navigate operational challenges, including ongoing industrial issues at its engineering business and complications with development projects. This resolution removes a major uncertainty from the company's legal and financial landscape.

Regulatory Compliance

The company has fulfilled all disclosure requirements under Regulation 30 of SEBI Listing Regulations, ensuring complete transparency with stakeholders. The settlement was completed within the prescribed timeline of the OTSS scheme, which had a deadline of December 31, 2025.

DCM Shriram Industries shares are in focus as the stock began trading on an ex-demerger basis following the December 26 record date for its approved demerger scheme. The company had initially announced December 19 as the record date before revising it to December 26.

Trading Timeline and Eligibility

Under the updated timeline and T+1 settlement cycle, December 23 was the final day for investors to purchase shares to remain eligible for demerger benefits. Since December 25 was a market holiday for Christmas, the stock commenced ex-demerger trading on December 24. Shares purchased on or after this date are not entitled to receive shares in the resulting entities.

Demerger Structure and Approvals

The demerger has received approval from the National Company Law Tribunal (NCLT), New Delhi Bench. The reorganisation involves creating two newly formed listed entities alongside the residual company:

Share Allocation Terms

Shareholders holding equity shares as of the record date will receive shares in a 1:1:1 ratio. The allocation structure provides:

• One share retained in residual DCM Shriram Industries
• One fully paid-up equity share of ₹2.00 each in DSFCL
• One fully paid-up equity share of ₹2.00 each in DSIL

Practical Example

For illustration, an investor holding 50 shares of DCM Shriram Industries as of the record date will:

The equity shares of both demerged entities will be credited to eligible shareholders after completion of necessary procedural formalities and implementation processes.