Shree Renuka Sugars has received two penalty orders from the CGST & Central Excise department regarding Input Tax Credit (ITC) matters for the period 2018-2022. The penalties, totaling over Rs. 2.47 crore, relate to alleged non-reversals and excess credit claims. The company maintains that its positions are legally sound and has initiated appeals with the appropriate authorities, asserting that there is no material impact on its ongoing financial or operational activities.
Breakdown of Tax Orders
The company received two distinct penalty orders, both dated December 4, 2025, issued by the Assistant Commissioner of the Belagavi City Division. The first order, involving a penalty of Rs. 10,53,089, pertains to allegations of failing to reverse Input Tax Credit (ITC) on damaged goods for which insurance claims were processed. The second order imposes a penalty of Rs. 1,41,74,831, citing claims of excess ITC on blocked credit.
Management Stance and Financial Impact
In both instances, the tax authorities have levied a penalty amount equal to the demanded tax. The company has formally challenged these orders by filing appeals before the relevant appellate authorities. Management holds a bona-fide view that the company maintains strong merits in its legal arguments against these demands.
Regarding the overall impact on the business, the company has clarified that these developments do not pose a material impact on its financial stability, daily operations, or long-term growth activities. The potential financial liability remains strictly limited to the quantum of these specific penalty amounts, which are currently being contested.
Source: BSE
