Zydus Wellness Limited has secured significant legal relief for its wholly owned subsidiary regarding a substantial GST demand, with the Gujarat High Court providing interim protection against enforcement proceedings.

Court Grants Interim Relief

The Gujarat High Court granted ad-interim relief to Zydus Wellness Products Limited (ZWPL) on January 9, 2026, restraining further proceedings related to a GST demand case. The court's decision came during a hearing for a writ petition filed under Article 226 of the Constitution of India, challenging an Order-in-Original (OIO) dated September 30, 2025.

GST Demand Details

The case involves a significant financial exposure for the Zydus Wellness subsidiary:

The Directorate General of Goods and Services Tax Intelligence, Surat Zonal Unit (DGGI) had issued the demand through a Show Cause Notice (SCN) and subsequent Order-in-Original, alleging GST liability along with applicable interest and penalty components.

Indemnification Coverage

A crucial aspect of this case is the indemnification arrangement covering the disputed period. The GST demand relates to the pre-acquisition period prior to January 30, 2019, and the liability stands fully indemnified by Heinz Italia S.P.A. This indemnification provides financial protection to Zydus Wellness against the potential liability arising from the disputed GST demand.

Regulatory Compliance

Zydus Wellness Limited has maintained transparency regarding this matter through regular disclosures to stock exchanges. The company referenced earlier disclosures dated October 29, 2025, February 27, 2025, and December 25, 2024, demonstrating consistent compliance with SEBI regulations regarding material developments.

The current disclosure was made under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, along with relevant SEBI Master Circulars. This regulatory framework ensures investors remain informed about significant legal and financial developments affecting the company and its subsidiaries.

The ad-interim relief provides temporary protection for ZWPL while the legal challenge proceeds through the judicial system, offering the subsidiary breathing room from enforcement actions during the ongoing litigation process.

Zydus Wellness Limited has issued a clarification to BSE Limited regarding the recent significant increase in trading volume of its equity shares across exchanges. The response, dated January 1, 2026, addresses surveillance concerns raised by the stock exchange about unusual market activity.

Company's Official Response

In its communication to BSE, Zydus Wellness emphasized that it has maintained full regulatory compliance and transparency. The company stated that all necessary disclosures have been made pursuant to Regulation 30 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

Key Clarifications Provided

The company made several important clarifications in its response to the exchange:

• No undisclosed events: Zydus Wellness confirmed there are no undisclosed events or information, including impending announcements, that could influence share price or volume behavior
• Market-driven activity: The company believes the significant volume increase is purely market-driven and beyond its control or knowledge
• Regulatory compliance: All disclosures have been made in compliance with SEBI listing regulations and will continue to be made as required

Regulatory Context

The clarification comes in response to BSE's surveillance mechanism, which monitors unusual trading patterns and seeks explanations from companies when significant volume or price movements occur. This is a standard procedure under exchange surveillance protocols to ensure market integrity and investor protection.

Zydus Wellness has requested BSE to take the clarification on record, reaffirming its commitment to maintaining transparency and regulatory compliance in all its market-related communications.