ISGEC Heavy Engineering Limited has received a penalty order from tax authorities over alleged wrongful availing of input tax credit, with a total financial impact of ₹31.91 lakh including interest. The company disclosed this development through a regulatory filing dated January 07, 2026, to the stock exchanges under Regulation 30 of SEBI Listing Regulations.

Tax Authority Action Details

The Assistant Commissioner (Central Tax Division) located at Jagadhri, District Yamunanagar, has taken action against the company regarding input tax credit matters. The order was received by ISGEC Heavy Engineering on January 07, 2026.

Nature of Alleged Violation

According to the penalty order, the tax department has alleged that ISGEC Heavy Engineering wrongly availed input tax credit on an invoice raised by a supplier. The specific details of the violation center around the improper claiming of input tax credit benefits under the Goods and Services Tax framework.

The company has characterized this as an allegation, indicating its disagreement with the tax authority's assessment of the input tax credit claim.

Company's Response Strategy

ISGEC Heavy Engineering has announced its intention to challenge the penalty order through the available legal remedies. The company stated it will file an appeal against this order under the provisions of the Goods and Services Tax Act.

This approach suggests the company believes it has valid grounds to contest the tax authority's findings regarding the input tax credit availing. The appeal process will allow ISGEC to present its case and supporting documentation to higher tax authorities.

Financial and Operational Impact

The total financial impact on the company amounts to ₹31.91 lakh, comprising the confirmed demand and penalty of ₹15.95 lakh each, along with applicable interest charges. While this represents a significant amount, the company has not indicated any immediate operational disruptions resulting from this penalty order.

The disclosure has been made available on the company's website at www.isgec.com , ensuring transparency with stakeholders regarding this regulatory development.

Isgec Heavy Engineering Limited has informed stock exchanges about a penalty of ₹1,71,116 imposed by the Central Tax authority. The company disclosed this development in compliance with Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Penalty Details

The penalty order was issued by the Assistant Commissioner (Central Tax), East Division 3, Bangalore East Commissionerate. The company received the official communication regarding this penalty order on December 31, 2025.

Nature of Violation

According to the company's disclosure, the penalty demand relates to taxes that were already paid by the company without any interest and penalty. The Assistant Commissioner of Central Tax, Bengaluru, passed the order raising this penalty demand despite the taxes being previously settled.

Company's Response

Isgec Heavy Engineering has announced its intention to challenge the penalty order. The company stated that it will be filing an appeal against this order under the provisions of the Goods and Services Tax Act. This indicates the company's disagreement with the penalty imposition and its confidence in contesting the decision through proper legal channels.

Financial Impact

The total financial impact on the company amounts to ₹1,71,116. While this represents a relatively modest amount for the engineering company, it reflects ongoing compliance challenges that businesses face under the GST regime.

Regulatory Compliance

The company has fulfilled its disclosure obligations by informing both the BSE and NSE about this development. Additionally, Isgec Heavy Engineering has published this information on its official website at www.Isgec.com , ensuring transparency with all stakeholders. The disclosure was signed by Kalyan Ghosh, Chief Legal Officer & Compliance Officer, demonstrating proper corporate governance procedures.