LT Foods Faces ₹32.41 Crore GST Demand After Appellate Order Reversal
LT Foods Limited received an appellate order dated January 30, 2026 from the Commissioner of CGST (Appeals-II), Delhi, confirming a GST demand of ₹32.41 crore along with interest and penalty. The order reversed an earlier favorable decision that had dropped the demand related to alleged wrongful GST exemption on rice supplies in plain packaging. The company plans to challenge the order before the GST Appellate Tribunal and does not expect material impact on its financial position or operations.
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LT Foods Limited has received an unfavorable appellate order from tax authorities, resulting in the confirmation of a significant GST demand that was previously dropped by lower authorities.
Appellate Order Details
The Commissioner of CGST (Appeals-II), Delhi issued Appellate Order No. C.NO 1316/C/GST/DL-APPEAL-II/2025-26/6801 dated January 30, 2026, which the company received on February 4, 2026. The order has reversed an earlier favorable decision and confirmed a substantial tax demand against the rice manufacturer.
| Parameter | Details |
|---|---|
| Authority | Commissioner of CGST (Appeals-II), Delhi |
| Order Date | January 30, 2026 |
| Receipt Date | February 4, 2026 |
| GST Demand Confirmed | ₹32.41 crore |
| Additional Components | Interest under Section 50 and penalty under Section 74 |
Background of the Tax Dispute
The case involves a complex sequence of decisions by different tax authorities. Initially, the Additional Commissioner, CGST, Delhi South Commissionerate had passed an Order-in-Original dated January 27, 2025, whereby the GST demand of ₹32.41 crore proposed in the Show Cause Notice was dropped, providing relief to LT Foods.
However, the Assistant Commissioner, CGST, Delhi South Commissionerate subsequently filed a departmental appeal before the Commissioner of CGST (Appeals-II), Delhi, challenging this favorable order. The appellate authority has now allowed the departmental appeal and set aside the Order-in-Original to the extent of dropping the demand.
Nature of Alleged Violation
The tax demand stems from alleged wrongful availment of GST exemption under Notification No. 02/2017-CT (Rate) dated June 28, 2017. The authorities contend that LT Foods' supplies of rice made in plain packaging were not eligible for exemption under the applicable provisions of the CGST Act, 2017.
The GST demand of ₹32.41 crore has been confirmed under Section 74 of the CGST Act, 2017, along with applicable interest under Section 50 and penalty as prescribed under Section 74 of the same Act.
Company's Response and Next Steps
LT Foods has indicated its intention to challenge the appellate order through further legal recourse. Based on legal advice received from the company's counsel, LT Foods believes it has strong grounds on merits to challenge the order and intends to file an appeal before the appropriate GST Appellate Tribunal within the prescribed timelines.
The company has stated that at this stage, it does not foresee any material impact on its financial position or operational performance arising from the order. This assessment suggests confidence in the company's legal position and its ability to manage the financial implications during the appeal process.
Regulatory Compliance
The disclosure has been made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, demonstrating the company's commitment to transparent communication with stakeholders regarding material developments that could impact its operations.
Historical Stock Returns for LT Foods
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -2.92% | -4.17% | +18.16% | -5.74% | +11.09% | +689.00% |
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