Lemon Tree Hotels Limited has received an order from the Central Goods & Service Tax authorities regarding tax liabilities for the period spanning FY 2019-20 to 2023-24. The demand relates to service imports under the reverse charge mechanism, involving a tax liability of Rs. 39,97,924/- and an equivalent penalty amount. The company maintains that there is no material financial impact and is currently evaluating its legal options to address the matter.
Details of the Tax Demand
On April 16, 2026, Lemon Tree Hotels Limited was notified of an order issued by the Office of the Assistant Commissioner of Central Goods & Service Tax, Delhi South Commissionerate. The demand concerns tax liabilities on the import of services under the reverse charge mechanism. The total demand includes a tax liability of Rs. 39,97,924/-, along with applicable interest and a matching penalty of Rs. 39,97,924/-.
Scope of the Order
The order covers a five-year period, specifically the Financial Years from 2019-20 to 2023-24. The authority has raised this demand based on findings related to tax compliance on service imports. The company has officially acknowledged receipt of the direction and is currently reviewing the implications of the order.
Financial Impact and Next Steps
Lemon Tree Hotels has stated that there is no material financial impact on its overall operations beyond the specific amount cited in the tax demand. The leadership team is in the process of evaluating available legal remedies and intends to initiate appropriate legal action in due course to contest or address the liability as necessary.
Source: BSE
