Mukka Proteins Limited, a prominent player in the protein industry, has received a significant reprieve in its ongoing GST dispute with the Office of the Assistant Commissioner of State Tax, Porbandar. The company has seen a substantial reduction in the proposed GST demand from an initial ₹141.06 crore to a mere ₹27.16 lakh.

Background of the GST Dispute

The dispute originated from alleged discrepancies in Mukka Proteins' GST returns for the financial year 2021-22. The company had disclosed the receipt of a GST Notice from the State Tax Officer in Porbandar, Gujarat, proposing a demand of ₹141.06 crore.

Company's Response and Revised Demand

In response to the initial notice, Mukka Proteins filed a detailed reply. The company categorically denied the allegations, asserting that all tax liabilities had been duly discharged and necessary reconciliations submitted. They also mentioned that certain voluntary payments had already been made where applicable.

Following the company's response, the Office of the Assistant Commissioner of State Tax, Porbandar, issued a Show Cause Notice (SCN) in Form DRC-01. This notice significantly revised the proposed demand.

Breakdown of the Revised Demand

The new GST demand of ₹27.16 lakh is composed of:

This revised figure also includes applicable interest and penalties.

Mukka Proteins' Stance and Future Course of Action

Despite the substantial reduction in the proposed demand, Mukka Proteins maintains that the revised figure is also untenable in law and on facts. The company has expressed its intention to contest this demand before the relevant authorities.

In its disclosure, Mukka Proteins stated, "The Company strongly believes that the revised demand is also untenable in law and on facts and will be suitably contested before the authorities. The Company continues to maintain that no material financial liability will arise from these proceedings."

Implications for Investors

This development is likely to be viewed positively by investors and stakeholders of Mukka Proteins Limited. The significant reduction in the proposed GST demand from ₹141.06 crore to ₹27.16 lakh substantially mitigates the potential financial impact on the company.

As the situation continues to evolve, investors will be keenly watching how Mukka Proteins navigates this regulatory challenge and its potential impact on the company's financial position and market performance.

Mukka Proteins Limited, a prominent player in the protein industry, has received a significant reduction in its Goods and Services Tax (GST) demand from the Gujarat tax authorities. The company has seen its GST liability cut dramatically from ₹141.06 crore to a mere ₹27.16 lakh, marking a reduction of over 99%.

Substantial Reduction in GST Demand

According to a regulatory filing by Mukka Proteins, the company received a Show Cause Notice (SCN) from the Office of the Assistant Commissioner of State Tax, Porbandar, Gujarat. This notice came in response to the company's reply filed on September 23, addressing an earlier intimation of a proposed GST demand of ₹141.06 crore for the financial year 2021-22.

The revised demand in the SCN breaks down as follows:

The total revised demand of ₹27.16 lakh also includes applicable interest and penalties.

Company's Stance and Future Actions

Despite the substantial reduction in the demand amount, Mukka Proteins has stated its intention to contest the revised figure. The company maintains that the revised demand is "untenable in law and on facts" and plans to challenge it before the appropriate authorities.

Mehaboobsab Mahmadgous Chalyal, Company Secretary & Compliance Officer of Mukka Proteins Limited, stated in the regulatory filing, "The Company strongly believes that the revised demand is also untenable in law and on facts and will be suitably contested before the authorities. The Company continues to maintain that no material financial liability will arise from these proceedings."

Background of the Case

The GST dispute dates back to September 18, when Mukka Proteins first received an intimation in Form DRC-01A from the State Tax Officer, Porbandar. The initial proposed demand of ₹141.06 crore was based on alleged discrepancies in GST returns for the financial year 2021-22.

In response, the company filed a detailed reply on September 23, denying the allegations and asserting that all tax liabilities had been duly discharged. The company also mentioned that reconciliations had been submitted and certain voluntary payments had already been made where applicable.

Implications for Investors

While the drastic reduction in the GST demand is a positive development for Mukka Proteins, the company's decision to contest the revised amount suggests ongoing uncertainty regarding its tax liabilities. Investors and market watchers will likely keep a close eye on further developments in this case, as the final outcome could impact the company's financial position.

As Mukka Proteins navigates this tax issue, stakeholders will be keen to see how it may affect the company's operations and financial performance in the coming quarters.