Chambal fertilisers & chemicals Limited has received a penalty order of Rs 96,86,205 from the Income Tax Department for alleged violations related to Assessment Year 2011-12. The company disclosed this development to stock exchanges on March 10, 2026, pursuant to Regulation 30 of SEBI LODR regulations.

Penalty Details and Authority

The Assessment Unit of the Income Tax Department issued the penalty order under Section 271(1)(c) of the Income Tax Act, 1961. The company received the order on March 09, 2026, with the total penalty amount aggregating to Rs 96,86,205.

Nature of Alleged Violations

The penalty stems from two specific matters related to deduction claims in the income tax return for Assessment Year 2011-12:

River Construction Expenditure Issue

The company incurred expenditure for construction of an anicut over the Parwan River to augment water supply required for manufacturing operations. Chambal Fertilisers claimed this expenditure as revenue expenditure, which was subsequently disallowed by the Assessing Officer in the regular assessment. During appellate proceedings, it was determined that the expenditure was capital in nature, and the company became eligible for depreciation from the year of capitalization.

Fertilizer Bonds Valuation Matter

The Government of India had settled part of fertilizer subsidy dues by issuing Fertilizer Bonds. When the fair market value of these bonds fell below their book value during the year, the company applied prudence principles and recognized the diminution in value in its books of account. The Assessing Officer disallowed this claim during assessment proceedings. In appellate proceedings, it was held that the deduction is allowed only in the year when the bonds are sold, not when the diminution is recognized. The loss was subsequently allowed in the year of actual sale of the bonds.

Financial and Operational Impact

The company has stated that there is no impact on its financial, operational, or other activities, except for the penalty amount mentioned above. Chambal Fertilisers maintains confidence in its position and believes it has a strong case to contest the order on merits.

Company's Response Strategy

Chambal Fertilisers and Chemicals Limited has indicated its intention to challenge the penalty order at the appropriate appellate forum. The company expressed confidence in its legal position, stating it has a good case to contest the order based on the merits of the matters involved. This disclosure was made by Tridib Barat, Vice President - Legal & Company Secretary, ensuring compliance with regulatory requirements for material developments.

CM Airtime Promotion LLP has announced another strategic acquisition in Chambal Fertilisers & Chemicals Ltd, purchasing an additional 67,722 equity shares through open market operations. This latest transaction, completed on March 9, 2026, marks the third acquisition by the promoter group entity within a week, demonstrating sustained confidence in the fertilizer company's prospects.

Latest Transaction Details

The recent acquisition represents continued investment by the promoter group entity following previous purchases on March 4 and March 5, 2026. The transaction was executed through open market operations and disclosed under SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 2011.

Updated Shareholding Pattern

Following this latest acquisition, CM Airtime Promotion LLP's total shareholding in Chambal Fertilisers & Chemicals Ltd has reached 2,012,552 shares, representing 0.502% of the company's equity capital. The LLP's stake has grown significantly over the recent acquisition spree.

Acquisition Impact Analysis

The combined acquisitions across multiple trading days totaling 362,722 shares represent a substantial increase in the promoter group's commitment to the company. The percentage holding has increased by 0.090% from the pre-acquisition level of March 3, 2026.

Company Information

Chambal Fertilisers & Chemicals Ltd maintains its equity share capital at Rs 4,00,65,22,970, comprising 400,652,297 equity shares. The company's shares are listed on both BSE Limited and National Stock Exchange of India Limited, providing liquidity for such open market transactions.

Regulatory Compliance

The disclosure was made in compliance with Regulation 29(2) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 2011. CM Airtime Promotion LLP, registered with LLP Identification Number AAE-6579, maintains its registered office at Mezzanine Floor, Hindustan Times House, 18-20, Kasturba Gandhi Marg, New Delhi-110001.

The series of acquisitions reflects the promoter group's strategic approach to increasing their stake in the fertilizer company, with all transactions conducted transparently through established market mechanisms and proper regulatory disclosure procedures.