Timken India Limited has received a significant update regarding its income tax demand notice, with the amount being reduced from ₹74.77 crores to ₹32.47 crores following a rectification order issued by the Income Tax Department for assessment year 2022-23.

Rectification Order Details

The Deputy Commissioner of Income Tax, Circle 1, Jamshedpur issued a rectification order dated December 24, 2025, addressing the company's petition filed on December 19, 2025. The rectification petition highlighted that the company was liable to pay tax at a rate of 25.168%, while the IT Department had erroneously calculated the tax demand at a rate of 34.94%.

Background of Transfer Pricing Dispute

The original income tax demand stemmed from an order passed under Section 143(3) read with Section 144C(13) and Section 144B of the Income Tax Act, 1961. The IT Department had disagreed with Timken India's transfer pricing methodology for its distribution segment and adopted alternative methods to determine arm's length pricing in transactions with associated enterprises.

Company's Response and Future Actions

Despite the substantial reduction in the tax demand, Timken India maintains that the revised order and demand notice remain "erroneous, flawed and are not sustainable." The company continues to plan filing an appeal before the appropriate authority to get the orders and demand notices quashed or rectified entirely.

Timken India has reiterated that it does not anticipate any immediate financial or monetary impact from these developments. The company disclosed this update pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, maintaining transparency with stakeholders regarding this significant regulatory development.

Timken India Limited has successfully resolved a consumer dispute case through an amicable settlement, avoiding potential financial penalties of ₹25,000. The company informed stock exchanges on December 17, 2025, about the favorable resolution of an appeal filed against a District Consumer Commission order.

Case Background and Original Dispute

The dispute originated from a share transmission request made by Mr. Ravi Shankar Sood in 2020-21. The shares were originally held in the name of his father, Mr. D.N. Sood, who passed away in 2013. CB Management Services Private Limited, serving as the Registrar and Transfer Agent (RTA), requested Mr. Sood to provide relevant documents as per SEBI Guidelines for the transmission process.

A disagreement arose when the RTA claimed it did not receive the requisite documents and therefore did not process the transmission. However, Mr. Sood maintained that he had submitted all necessary documents for the share transmission.

District Commission Order and Penalties

Mr. Sood filed a complaint before the District Consumer Disputes Redressal Commission, Shimla, alleging deficiency in service by the RTA and company in processing the share transmission. The District Commission ruled in favor of Mr. Sood and issued specific directions to resolve the matter.

The original order required the RTA and company to process the transmission within 60 days of receiving all documents and completing formalities. Additionally, the District Commission imposed financial penalties on both entities.

Appeal and Settlement Resolution

Timken India Limited and the RTA filed an appeal against the District Commission's order before the State Consumer Disputes Redressal Commission, Himachal Pradesh. During the pendency of the appeal proceedings, all parties engaged in settlement discussions and reached a mutually acceptable resolution.

The State Commission disposed of the appeal with the consent of all parties involved. Importantly, the settlement was concluded without any costs, compensation, or penalty imposed on the company or its RTA.

Financial and Operational Impact

The company has confirmed that the settlement has no financial, operational, or other impact on its activities. The successful resolution means Timken India Limited and its RTA are not required to pay the originally awarded ₹15,000 compensation and ₹10,000 litigation costs to Mr. Sood.

This favorable outcome demonstrates the company's commitment to resolving disputes through appropriate legal channels while protecting shareholder interests. The settlement approach also reflects efficient dispute resolution practices that avoid prolonged litigation costs and potential reputational impacts.