Escorts Kubota Limited announced that the State Tax Officer in Chennai has officially dropped a significant tax demand amounting to Rs. 46.79 Crores, which included interest and penalties pertaining to the Financial Year 2019-20. This resolution follows earlier contests initiated by the company regarding the wrong classification of agricultural tractors versus road tractors, leading to the complete waiver of the disputed GST liability.
Resolution of Major Tax Dispute
Escorts Kubota Limited provided an update on significant legal and regulatory matters, confirming a favorable development concerning tax assessments from the Financial Year 2019-20. The State Tax Officer, Mandaveli Assessment Circle, Chennai, passed an order on March 26, 2026, officially dropping the previously raised tax demand.
Details of Dropped Demand
The total tax liability dropped by the authorities amounted to Rs. 46.79 Crores, encompassing all associated interest and penalties. This decision effectively settles the matter that originated from Show Cause Notices issued on May 07, 2025. The company had previously contested the levies on the grounds that the tax authorities had wrongly classified agricultural tractors as road tractors and improperly calculated the alleged GST on the total turnover rather than solely on the turnover related to tractors.
Event Timeline
The event marking the official order passing occurred on March 26, 2026, at 07:15 P.M. (IST). This resolution concludes the proceedings that had been previously reported to the exchanges in earlier intimations filed on May 08, 2025, December 30, 2025, and January 30, 2026.
Source: BSE
