Valiant Laboratories Limited has disclosed receiving a significant Show-Cause Notice from tax authorities, demanding approximately ₹12.53 crores in Goods and Services Tax (GST) along with applicable interest and penalties. The pharmaceutical company made this disclosure under Regulation 30 of SEBI Listing Regulations on January 15, 2026.

Notice Details and Timeline

The Show-Cause Notice, dated January 14, 2026, was received via email on Wednesday at 15:52 IST from the Office of the Commissioner of CGST & Central Excise (Audit), Raigad, Vashi, Navi Mumbai. The notice was issued under the CGST Act, 2017 and SGST Act, 2017, addressing multiple alleged tax compliance issues.

Key Allegations and Financial Impact

The tax demand encompasses three primary areas of concern, each with substantial financial implications:

Specific Compliance Issues

IPO-Related Tax Credit Dispute

The authorities have challenged the Input Tax Credit claimed on expenses incurred for the Initial Public Offer. The department contends that IPO expenses are attributable to "transaction in securities," which qualifies as an exempt supply. Consequently, the ITC claimed on these expenses, approximately ₹2.85 crores, is deemed ineligible as it was exclusively used for exempted goods supply.

Turnover Discrepancy in Transition Period

The notice addresses a turnover mismatch in FY 2021-22, involving approximately ₹9.31 crores in short payment of GST. This discrepancy arose from differences between the taxable turnover declared in Financial Statements and GSTR-3B returns during the transition period when partnership firm 'Bharat Chemicals' was converted into 'Valiant Laboratories Ltd'.

Corporate Guarantee Tax Liability

The third issue concerns non-payment of GST on a ₹100 crore Corporate Bank Guarantee provided to related party M/s. Valiant Advanced Services Pvt Ltd. The department has valued this service at 2% per annum and demanded GST on it, amounting to approximately ₹36 lakhs.

Regulatory Compliance and Next Steps

The company has fulfilled its disclosure obligations under Regulation 30 read with Clause 8 of Para B of Part A of Schedule III of the Listing Regulations. The intimation has been uploaded on the company's website at www.valiantlabs.in and communicated to both BSE Limited and National Stock Exchange of India Limited. The notice proposes penalties under Sections 50, 74, and 122 of the CGST Act, 2017, in addition to the primary tax demand and applicable interest.

Valiant Laboratories Limited has received a final order from the Assistant Commissioner of CGST & Central Excise, Division-IV, Navi Mumbai Commissionerate, confirming a tax demand and penalty totaling ₹62.97 lakh for alleged wrong availment of Input Tax Credit (ITC) on capital goods.

GST Order Details

The order dated December 26, 2025, confirms a demand for wrong availment of Input Tax Credit on capital goods for the financial year 2021-22. The company had claimed depreciation on the GST component of capital goods, which has been held to be impermissible by the tax authorities.

Regulatory Violations Alleged

The GST authorities have identified violations under multiple sections of the CGST Act, 2017. The disallowance pertains to ITC on capital goods due to non-fulfillment of conditions and claim of depreciation on tax component, allegedly violating Sections 16(2), 17(5), 73, 50 and 122(2)(a) of the CGST Act, 2017, along with applicable provisions of the IGST and MGST Acts.

Company's Response Strategy

Valiant Laboratories has stated that it is evaluating all available options, including filing an appeal against the order before the appropriate authority. The company is assessing the course of action to challenge the GST order and present its case to higher tax authorities.

Compliance and Disclosure

In adherence to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the pharmaceutical company has promptly informed the stock exchanges about this development. The intimation has also been uploaded on the company's website at www.valiantlabs.in , ensuring transparent communication with all stakeholders.

Financial Impact Assessment

The confirmed liability of ₹62.97 lakh represents a reduction from the earlier proposed amount of ₹70.81 lakh mentioned in the show-cause notice. While this remains a significant financial obligation for the small-cap pharmaceutical company, the final outcome will depend on the success of any appeal proceedings the company may initiate.