Brigade Enterprises has received a show cause notice (SCN) from the Directorate General of GST Intelligence, Bengaluru concerning potential undervaluation of construction services. The notice alleges irregularities related to services provided to landowners in exchange for development rights, potentially resulting in additional tax liabilities. The company is preparing its response and believes the SCN is without merit.
GST Notice Received
Brigade Enterprises has been served a show cause notice (SCN) on December 2, 2025, by the Directorate General of GST Intelligence, Bengaluru. The SCN addresses concerns related to the valuation of construction services.
Details of the Allegations
The core issue raised in the SCN pertains to the alleged undervaluation of construction services provided to landowners. These services were reportedly provided in exchange for development rights obtained through joint development agreements. The authorities are scrutinizing whether the appropriate Goods and Services Tax (GST) was paid on these transactions.
The notice outlines several specific concerns, including:
- Potential re-determination of the value of construction services provided to landowners in multiple Brigade projects, including Brigade Senate-1(Wing-1 & Wing-2), Brigade Senate-2, Brigade Deccan Heights, and Brigade North Ridge Neo Projects.
- A proposed demand for GST related to Brigade Parkside North project, amounting to ₹11,01,62,672.
- Potential rejection of the declared value for construction services in the aforementioned Brigade projects.
Financial Implications and Response
The SCN indicates a potential demand of ₹91,80,22,265 related to the Brigade Parkside North project. Furthermore, the notice questions the valuation of services worth ₹386,14,61,590 across other projects. The company also faces potential interest and penalties.
Brigade Enterprises maintains that the SCN lacks merit and intends to submit a comprehensive response to the GST authorities within the stipulated timeframe. The company does not anticipate significant financial or operational impacts from this notice.
Source: BSE