Escorts Kubota announced that the State Tax Officer in Chennai dropped tax demands totaling ₹299.24 Crores. The demands, which included interest and penalties, pertained to Financial Years 2020-21 through 2023-24. The original tax demands were contested by the company based on the classification of agricultural tractors and the computation of GST.
Favorable Resolution in Tax Dispute
Escorts Kubota has received orders from the State Tax Officer, Mandaveli Assessment Circle, Chennai, resolving a contested tax issue. The orders, dated January 29 & 30, 2026, drop the previously demanded tax amount of ₹299.24 Crores, which included interest and penalties.
Background of the Tax Demand
The tax demands related to Financial Years 2020-21 to 2023-24. Escorts Kubota challenged the demands, arguing that there was a misclassification of agricultural tractors and an incorrect calculation of taxes on the total GST turnover. The company had previously received Show Cause Notices regarding this matter.
Impact and Next Steps
The dropping of the tax demand represents a positive development for Escorts Kubota, eliminating a significant financial liability. The company will continue to monitor and manage its tax positions in accordance with applicable laws and regulations.
Source: BSE
