Bayer CropScience Limited has achieved a significant regulatory victory, successfully overturning a ₹100 million customs penalty through an appellate tribunal ruling. The company announced on January 22, 2026, that the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) had set aside the original penalty order in its favor.

Background of the Customs Dispute

The original penalty was imposed by the Office of Commissioner of Customs, Centralized Adjudication Cell, Maharashtra through an order dated December 15, 2023. The penalty of ₹100 million was levied under the Customs Act, 1962, relating to alleged misclassification of exported goods under Rule 3(a) of General Rules for Interpretation of the Harmonized System.

Appellate Tribunal Decision

The Customs, Excise & Service Tax Appellate Tribunal issued its final order on January 20, 2026, which was received by the company on January 21, 2026. The tribunal allowed Bayer CropScience's appeal, confirming the company's eligibility to claim export incentives and setting aside the demand raised by the Nhava Sheva Customs authorities.

Financial Impact and Settlement Details

The favorable tribunal ruling has resulted in the complete quashing of all financial demands against the company. The tribunal's decision eliminated multiple financial obligations that had been imposed by the customs authorities.

Regulatory Compliance

The company has fulfilled its disclosure obligations under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. This announcement serves as an update to the company's previous disclosure made on December 18, 2023, regarding the original customs penalty proceedings.

The successful appeal outcome demonstrates no adverse impact on Bayer CropScience's financial position, with the company avoiding both the original penalty and associated recovery demands without any settlement payments.

Bayer Crop Science has received a penalty order of Rs. 1.55 million from the Office of the Superintendent of Central Tax, Amaravathi CGST Division, Guntur, Vishakapatnam, Andhra Pradesh. The penalty relates to Goods and Services Tax (GST) on Outward Supply for the Financial Year 2018-19.

Penalty Details

The company disclosed the following information regarding the penalty:

Company's Response

Bayer Crop Science has stated that the order is currently appealable. The company plans to make an assessment to exercise its right to appeal against the penalty. This approach suggests that Bayer Crop Science may challenge the order if they believe there are grounds for contesting the penalty.

Regulatory Compliance

The company made this disclosure in compliance with Regulation 30 of the Securities and Exchange Board of India (SEBI) Listing Obligations and Disclosure Requirements Regulations, 2015. The disclosure was communicated to BSE Limited on December 16, 2025, through a formal letter signed by Company Secretary and Compliance Officer Bharati Shetty.

Potential Impact

While the penalty amount of Rs. 1.55 million represents a regulatory compliance matter, the full financial impact on Bayer Crop Science will depend on the outcome of any potential appeal process. The company has indicated it will assess its options for challenging the order through appropriate legal channels.