GAIL (India) Receives ₹143.08 Crore GST Demand Notice for Corporate Guarantees

GAIL (India) has received a substantial GST demand notice from tax authorities, creating a significant financial obligation for the gas distribution company. The development was disclosed through an official regulatory filing under SEBI LODR Regulations, highlighting ongoing regulatory scrutiny of corporate guarantee structures and their tax treatment under the GST framework.

Official GST Demand Notice

The company received an Order-in-Original from the Additional Commissioner, CGST, Delhi South Commissionerate on December 10, 2025, at 05:00 PM. The demand specifically relates to corporate guarantees that GAIL (India) has provided to banks on behalf of its subsidiaries and joint ventures without consideration.

Parameter:	Details
Penalty Amount:	₹143.08 crore
Issuing Authority:	Additional Commissioner, CGST Delhi South
Receipt Date:	December 10, 2025 at 05:00 PM
Nature of Violation:	Non-payment of GST on corporate guarantees
Beneficiaries:	Subsidiaries and Joint Ventures

Regulatory Violation Details

The GST authorities have identified the violation as "Non-payment of GST on Corporate Guarantee issued to bank on behalf of subsidiaries, JVs etc. without consideration." This indicates that the tax department considers such guarantee arrangements as taxable services under the GST regime, even when provided without explicit consideration between related entities.

Financial Impact and Compliance

The penalty of ₹143.08 crore represents a significant financial impact on GAIL (India)'s operations. The company has made this disclosure in compliance with Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, ensuring transparency with stakeholders regarding statutory actions taken against the company.

Corporate Guarantee Implications

This development reflects the complex tax implications surrounding corporate guarantees provided by parent companies to their subsidiaries and joint ventures. The case highlights how tax authorities are interpreting GST applicability on financial services, particularly guarantee provisions between related entities, even in the absence of explicit consideration or fees.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
+0.45%	+0.62%	-8.76%	-11.24%	-15.28%	+104.69%

GAIL (India) Limited , the state-owned natural gas processing and distribution giant, has received an updated Environmental, Social, and Governance (ESG) rating assessment from NSE Sustainability Ratings Analytics. The company maintains its ESG rating of 66, categorized as 'Aspiring', with the latest review conducted on December 8, 2025.

ESG Performance Breakdown

The comprehensive ESG assessment reveals GAIL's performance across three key pillars:

ESG Pillar:	Score	Performance Highlights
Environment:	56	Challenges in emissions and renewable energy adoption
Social:	76	Strong worker safety performance
Governance:	71	Robust compliance with governance standards
Overall ESG Rating:	66	'Aspiring' category

Environmental Performance Challenges

GAIL faces several environmental sustainability challenges that impact its environmental score of 56:

Environmental Metric:	Performance Status
Greenhouse Gas Emissions:	Above industry averages from direct operations
Scope 3 Emissions:	13% increase compared to previous year
Water Intensity:	12% decrease compared to previous year
Energy Intensity:	Above industry benchmarks
Renewable Energy Adoption:	34% increase but still lagging behind peers
Waste Management:	50% increase in waste intensity
Waste Recycling:	11% increase but below peer performance

Social Performance Strengths

The company demonstrates strong social performance with a score of 76, driven by several positive factors:

Social Metric:	Performance Details
Lost Time Incident Rate:	90% decrease compared to previous year
Worker Fatalities:	1 fatality reported in assessment year
Health Insurance Coverage:	At par with industry norms for permanent employees
Accident Insurance:	Adequate coverage for permanent workers
Employee Grievances:	28% decrease compared to previous year
Employee Turnover:	9% increase but below industry average
Customer Complaints:	Lower than industry benchmarks

Governance Excellence

GAIL's governance score of 71 reflects strong compliance across multiple areas:

Governance Area:	Compliance Status
Board Composition:	Meets independent director requirements
Women Directors:	Fulfills regulatory requirements
Nomination Committee:	Above compliance requirements for independence
Audit Committee:	Better than statutory guidelines
Risk Management Committee:	Meets regulatory threshold
CSR Committee:	Above regulatory requirements

Core ESG Rating Assessment

NSE Sustainability also provided a Core ESG Rating based on third-party assured data from BRSR Core disclosures:

Core Rating Component:	Score
Core ESG Rating:	43
Core Environment Score:	46
Core Social Score:	51
Core Governance Score:	34

This Core ESG Rating emphasizes transparency and reliability by utilizing verified data points critical for assessing sustainability profiles.

Financial Performance Context

Alongside its ESG efforts, GAIL continues to demonstrate strong financial performance:

Financial Metric:	Value (₹ Crore)	YoY Change
Revenue:	143,171.10	+6.66%
Net Profit:	12,462.90	+25.85%
EBITDA:	16,699.50	+9.12%
EPS (₹):	18.93	+25.70%

The company's robust financial foundation provides resources to address ESG challenges, particularly in environmental sustainability where improvement opportunities exist. As GAIL continues to balance financial growth with ESG responsibilities, the focus remains on enhancing environmental performance while maintaining strong social and governance practices.