Amara Raja Energy & Mobility Limited has received another significant tax development as the Commissioner of Central Tax, Appeals-II, Delhi upheld an original GST order worth ₹22.06 crores. The appellate order dated January 14, 2026, was received by the company on January 17, 2026, adding to the company's ongoing tax challenges across multiple states.

Delhi GST Appellate Order Details

The Commissioner of Central Tax, Appeals-II, Delhi has upheld the original order passed by the Additional Commissioner, Delhi South on January 28, 2025, under Section 107 of the CGST/DGST Act, 2017.

The violations include excess Input Tax Credit (ITC) availed and utilized in GSTR-3B over GSTR-2A, supply of goods covered under warranty period, claiming ITC from non-filers of GSTR-3B, and payment of interest as per rule 37 for 180 days reversal.

Previous Tax Orders Across States

This latest development adds to the company's existing tax orders from other states, bringing the total exposure to significant amounts across multiple jurisdictions.

Rajasthan GST Order

The Deputy Commissioner, Circle-A, Jaipur-III, Rajasthan, had issued Order No. ZD0812250933186 under Section 74 and 122 of the CGST/RGST Act, 2017.

Andhra Pradesh Income Tax Order

The Deputy Commissioner of Income Tax, Circle-1(1), Tirupati issued an order under Section 143(1) of the Income Tax Act, 1961.

Tamil Nadu GST Penalty

The Deputy Commercial Tax Officer, Erode, Tamil Nadu issued a penalty order worth ₹28,43,770 for goods movement violations.

Consolidated Tax Exposure

Company's Response Strategy

Amara Raja Energy & Mobility has indicated it will file an appeal before the GST Tribunal once formed, by paying the required pre-deposit. The company maintains that there is no material impact on its financial, operational, or other activities. The liability pertaining to the original Delhi order has already been disclosed in the financial statements under 'Contingent Liability'.

Regulatory Compliance

The disclosure was made pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Company Secretary and Vice President-Legal Vikas Sabharwal signed the regulatory filing submitted to both NSE and BSE on January 19, 2026.

Amara Raja Energy & Mobility Limited (ARE&M) has reported a consolidated revenue of INR 3,467 crores for the second quarter, marking a 6.5% year-over-year growth. The company's performance was primarily driven by robust demand from Original Equipment Manufacturers (OEMs) in the automotive sector.

Lead Acid Business Remains Strong

The lead acid business, which contributes 95% of the company's revenue, grew by 5% year-over-year to INR 3,297 crores. This growth was largely attributed to a significant 30% increase in OEM volumes across both 4-wheeler and 2-wheeler segments. However, aftermarket volumes remained stable due to procurement delays following GST rate revisions.

New Energy Business Shows Promise

ARE&M's New Energy business demonstrated impressive growth, delivering INR 170 crores in revenue, a more than 50% increase compared to the previous year. This growth was supported by increased demand for telecom packs and chargers. The company supplied 150 megawatts in telecom volumes and commenced production of 3-wheeler packs with LFP cells.

Financial Performance

The company's stand-alone operating margins stood at 12%, impacted by warranty expense provisions and Extended Producer Responsibility (EPR) liability provisions totaling INR 35 crores. Excluding these provisions and the impact of lithium telecom batteries, the adjusted operating margin would have been around 12.4%.

Investment in Lithium Subsidiary

ARE&M invested INR 350 crores in Amara Raja Advanced Cell Technologies during the quarter, bringing the total investment in its lithium subsidiary to INR 1,200 crores. This move aligns with the company's strategy to expand its presence in the New Energy sector.

Segment-wise Performance

Future Outlook

The company has outlined a capital expenditure plan of INR 1,400-1,500 crores for the full year, with a major allocation towards the New Energy business. ARE&M aims to increase its New Energy business contribution to 5% of overall revenue by the end of the current fiscal year and potentially 7-8% by FY'27.

Y. Delli Babu, Chief Financial Officer of Amara Raja Energy & Mobility Limited, commented on the results, stating, "We expect the Lead Acid Battery revenue to grow anywhere between 8% to 10% in the next year as well. Our aspiration is to move to a 13% EBITDA margin on a run rate basis and eventually return to our original 14% margin over time."

The company's focus on both traditional lead acid batteries and new energy solutions positions it well to capitalize on the evolving energy storage market in India and internationally.