Zydus Lifesciences has received confirmation from the Central Goods and Services Tax and Central Excise regarding a demand of ₹33.50 million related to CENVAT credit on sales commission paid to foreign entities. While initial demands were significantly higher, most were dropped following company submissions. Zydus intends to challenge the confirmed order via appeal.
Tax Demand Confirmation
Zydus Lifesciences Limited has received an order confirming a demand of ₹33.50 million from the Central Goods and Services Tax and Central Excise. This demand pertains to the alleged availment of CENVAT credit on sales commission payments made to foreign entities.
Background of the Tax Notices
Previously, Zydus Lifesciences had received multiple show cause notices from the Central Excise and Service Tax Authorities concerning CENVAT credit availment on input services, totaling ₹392.47 million. These notices covered the period from March 2008 to June 2017.
Following detailed submissions, the authorities dropped demands amounting to ₹358.97 million. The remaining demand of ₹33.50 million relates to CENVAT credit on sales commission paid to foreign entities. The order was issued on September 19, 2025 and received by the company on September 24, 2025.
Order Details
The demand pertains to the alleged availment and utilization of CENVAT credit on sales commission paid to foreign entities as Business Auxiliary Services during the period from March 2008 to June 2017.
Company’s Response
Zydus Lifesciences intends to challenge the order by filing an appeal. The company does not anticipate a material financial impact.
Source: BSE
