BGR Energy Systems has received a regulatory order from tax authorities regarding alleged Input Tax Credit violations spanning nearly three years. The company disclosed receiving Order-in-Appeal No. 1153-1155 (SCM) CGST/JDR/2025 dated November 28, 2025, on December 29, 2025, under SEBI listing regulations.

Order Details and Background

The Commissioner (Appeals), Central Goods & Service Tax and Central Excise, Jodhpur, passed the order in response to appeals filed by BGR Energy Systems against Order-in-Original No. 10/GST/UDR/2023-24/JC dated July 30, 2024. The original order was issued by the Joint Commissioner, CGST, Udaipur, following a GST audit conducted for the period July 2017 to March 2020.

Financial Impact and Allegations

The order addresses alleged wrongful availment of Input Tax Credit under the CGST Act, 2017 provisions. The financial implications are detailed in the following breakdown:

The allegations center on the company's Input Tax Credit claims during the specified period, with tax authorities questioning the legitimacy of these availments under GST regulations.

Regulatory Compliance and Disclosure

BGR Energy Systems made the disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, in compliance with SEBI circulars dated July 13, 2023, and November 11, 2024. The company provided comprehensive details about the regulatory action as required by listing obligations.

Company's Response and Next Steps

BGR Energy Systems stated it is presently examining the Order-in-Appeal and evaluating further legal remedies as may be advised. The company indicated its intention to appeal against the order, suggesting it disputes the findings of the tax authorities. The examination process will likely involve detailed review of the order's contents and consultation with legal advisors to determine the most appropriate course of action.

The company has not quantified the specific financial impact on its operations in monetary terms beyond the disputed amounts mentioned. The disclosure fulfills the company's obligation to keep investors informed about significant regulatory developments that could potentially affect its financial position.

BGR Energy Systems has received a substantial GST demand order from the Commissioner, Central Goods and Services Tax (CGST), Nellore, with significant financial implications for the infrastructure company. The order relates to alleged tax violations spanning multiple financial years.

GST Demand Details

The demand order carries substantial financial implications for the company:

Nature of Alleged Violations

The GST demand stems from alleged improper Input Tax Credit (ITC) practices during the financial years 2018-19 to 2020-21. The specific violations include:

• Wrong availment and utilisation of Input Tax Credit on certain invoices
• Vendors of the company had not filed GSTR-3B returns
• Consequently, these vendors had not discharged their GST liability

These allegations suggest discrepancies in the company's tax credit claims based on transactions with non-compliant suppliers.

Company's Response Strategy

BGR Energy Systems has outlined its approach to address the demand order:

Regulatory Compliance

The disclosure was made under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company has provided detailed information as per SEBI circulars, ensuring transparency with stakeholders regarding regulatory actions.

BGR Energy Systems plans to challenge the order through the appropriate appellate process, suggesting confidence in its position regarding the alleged violations. The outcome of this appeal will be crucial in determining the final financial impact on the company.