Cords Cable Industries Limited has received a demand order from tax authorities regarding Central Goods and Services Tax (CGST) matters. The company disclosed this development through a regulatory filing.

Order Details and Authority

The demand order was issued by the Assistant Commissioner, CGST Division-Tijara, located at Alwar Bypass Road, Bhiwadi, Alwar, Rajasthan.

Financial Impact and Penalty Structure

The order demands ₹35.59 lakh under Section 74 of the CGST Act, 2017, along with corresponding provisions of SGST Act, 2017 and IGST Act, 2017. Additionally, the company faces a penalty of equivalent amount under Section 122(2)(b) read with Section 74 of the CGST Act and corresponding provisions of IGST and SGST Acts.

Nature of Alleged Violation

The tax authorities have disallowed input tax credit on purchases for the period spanning financial years 2018-19 to 2022-23. The order alleges incorrect availment of input tax credit by the company during this five-year period.

Company's Response and Next Steps

Cords Cable Industries plans to file a rectification application against the said order with the authorities. The company maintains that there is no material impact on its financial, operational, or other activities due to this order.

Regulatory Compliance

The disclosure was made pursuant to regulatory requirements, ensuring full transparency with stakeholders regarding this regulatory development.

Cords Cable Industries Limited , a prominent player in the cable manufacturing sector, has received a rectification order significantly reducing the GST penalty imposed on its Managing Director and Whole Time Director. The penalty, which was initially set at Rs. 1,05,87,295, has been reduced to Rs. 50,000 under the provisions of the CGST Act.

Details of the GST Rectification

The rectification order relates to disallowed input tax credit for purchases made during the financial years 2018-19 to 2020-21. This development follows the company's earlier response to a GST demand order from the Assistant Commissioner, CGST Division-Tijara, Alwar.

Company's Response

In response to the original demand order, Cords Cable Industries had taken the following steps:

1. Deposited Rs. 1,76,55,460 under protest, covering the demand, interest, and penalty
2. Announced its intention to file an appeal against the order with the Appellate Authorities

The company maintains that there is no material impact on its financial operations or other activities due to this development. Cords Cable Industries plans to proceed with filing an appeal against the original order.

Financial Implications

While the significant reduction in the penalty is a positive development for Cords Cable Industries, the company has already deposited Rs. 1,76,55,460 under protest. The outcome of the planned appeal may determine whether any portion of this amount will be refunded.

Market Implications

The substantial reduction in the penalty may be viewed positively by investors and stakeholders. It suggests that the company's position regarding the GST demand may have merit, which could be favorable for the ongoing appeal process.

Investors will likely continue to monitor the progress of the company's appeal and any potential impact on future financial statements. The outcome of this regulatory matter may have implications for the company's tax liabilities and compliance processes going forward.

As the situation develops, market participants will be keen to see how Cords Cable Industries balances its growth trajectory with regulatory compliance, and whether this incident leads to any changes in the company's financial management or tax strategies.