Azad Engineering Limited has disclosed the receipt of orders from the Central Tax and GST authorities imposing penalties totaling approximately ₹11.49 lakh. The penalty stems from alleged violations under the CGST/SGST Act for Financial Years 2019-20 and 2020-21, relating to the availment of blocked Input Tax Credit (ITC) and non-payment of GST on other income. The company states the impact on financials is not material and plans to appeal the orders, expecting a favorable outcome.
Disclosure of Penalty Orders Received
Azad Engineering Limited has formally informed the stock exchanges that it has received orders imposing monetary penalties from the Joint Commissioner, Office of the Commissioner of Central Tax and GST, Jeedimetla Division, Hyderabad. These communications were received on March 24, 2026.
Details of the Imposed Penalties
The orders primarily levy penalties under Section 73 read with 122(2)(a) and (b), and Section 74 read with 122(2)(b) of the CGST/SGST Act, 2017, including corresponding IGST provisions. The total aggregate penalty imposed is INR 10,38,280/- plus INR 1,10,582/-, resulting in a combined penalty of INR 11,48,862/-.
Basis for Penalties and Financial Impact
The penalties were specifically levied concerning the availment of blocked Input Tax Credit (ITC) u/s 17(5) and the Non-payment of GST on other income for the Financial Years 2019-20 and 2020-21.
Regarding the financial effect, the company does not envisage any material impact on its financials, operational, or other activities. The company is currently evaluating all options, which includes filing an appeal against the order at a higher forum, and anticipates a favorable resolution.
Source: BSE
