SML Mahindra Limited has disclosed receiving an appeal effect order from the Income Tax Department with total adjustments of ₹16.41 lacs for Assessment Year 2022-23. The company communicated this development to stock exchanges on December 10, 2025, in compliance with regulatory disclosure requirements.

Income Tax Order Details

The Assistant Commissioner of Income Tax - Transfer Pricing, Delhi issued the appeal effect order on December 9, 2025, following directions from the Dispute Resolution Panel under section 144C(5). The company received and downloaded the order from the Income Tax portal on December 10, 2025, at 3:12 PM.

Transfer Pricing Disputes

The Income Tax Authority has raised disputes regarding two key areas of the company's transfer pricing practices. The primary concerns involve the Arms Length Price and methodology adopted by SML Mahindra Limited for payment of Corporate Guarantee fees to Associated Enterprises. Additionally, the authority has questioned the method used for ascertaining Arms Length Price in the company's manufacturing segment operations.

Previous Developments

This latest order represents a continuation of ongoing transfer pricing proceedings. Earlier, the Dispute Resolution Panel had issued directions under section 144C(5) on November 22, 2025, for the same assessment year with adjustments of ₹9.92 lacs. The company had previously communicated these developments to stock exchanges on November 22, 2025, through letter number SML/SEC/2025-26-083.

Potential Penalties and Company Response

The order indicates that the Assessing Officer may examine the initiation of penalty proceedings under section 270A of the Income Tax Act, 1961. This provision typically relates to penalties for underreporting of income or misreporting of facts in tax returns.

SML Mahindra Limited has stated its intention to file an appeal against this order, indicating the company's disagreement with the tax authority's assessment and adjustments. The company continues to maintain compliance with regulatory disclosure obligations by promptly informing stock exchanges of these developments.

Regulatory Compliance

The disclosure was made pursuant to Regulation 30(2) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with Clause 20 of Para A of Part A of Schedule III. This ensures transparency regarding material developments that could impact the company's financial position or operations.

SML Mahindra , a key player in the automotive sector, has received a significant update to its credit ratings from ICRA Limited, a prominent credit rating agency in India. The new ratings provide investors with an updated assessment of the company's financial strength and creditworthiness.

New Commercial Paper Rating

ICRA has assigned a new rating for SML Mahindra's commercial papers:

The ICRA [A1] rating indicates a very strong degree of safety regarding timely payment of financial obligations, carrying the lowest credit risk.

Reaffirmed Ratings

In addition to the new commercial paper rating, ICRA has reaffirmed the company's existing ratings:

The reaffirmation of these ratings suggests that ICRA maintains its positive outlook on SML Mahindra's financial stability and ability to meet its financial obligations.

Implications for Investors

These rating actions have several implications for investors and stakeholders:

1. Enhanced Borrowing Capacity: The new commercial paper rating opens up additional avenues for short-term borrowing, potentially allowing SML Mahindra to optimize its working capital management.

2. Financial Stability: The reaffirmation of existing ratings indicates that the company's financial position remains strong, which may instill confidence among investors and lenders.

3. Market Perception: Positive ratings from a reputed agency like ICRA may positively influence market perception of SML Mahindra, potentially impacting its stock performance and borrowing costs.

The company disclosed this information in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, demonstrating its commitment to transparency with investors and regulatory bodies.

As the automotive industry continues to evolve, SML Mahindra's strong credit ratings may position it well to capitalize on growth opportunities and navigate market challenges. Investors and stakeholders may want to consider these ratings as part of their overall assessment of the company's financial health and future prospects.