DOMS Subsidiary Uniclan Healthcare Faces ₹15.68 Lakh Tax Demand

DOMS Industries' subsidiary, Uniclan Healthcare, has received a tax order from the Office of Superintendent of Central Taxes (CGST), Thane. The order alleges wrongful availment and utilization of Input Tax Credit (ITC) for the financial year 2021-22.

The demand comprises ₹5,22,692 in recovery, ₹10,45,384 as a penalty, and applicable interest, bringing the total to ₹15,68,076.

Uniclan Healthcare is pursuing legal avenues to contest the tax demand and will submit its response within the designated timeframe. The company has indicated that this order is not expected to materially impact its financial performance or operational activities.

Input Tax Credit (ITC) is a mechanism within India's Goods and Services Tax (GST) framework that allows businesses to claim credit for taxes paid on inputs used in their business. Allegations of improper ITC claims can result in significant financial liabilities.

DOMS Industries, a well-established name in stationery and art materials, expanded into the baby hygiene sector through its majority stake acquisition in Uniclan Healthcare in September 2024. Uniclan Healthcare focuses on manufacturing baby diapers and wipes. The tax order relates to Uniclan's business operations during the financial year 2021-22, preceding DOMS's acquisition. DOMS Industries had previously launched its Initial Public Offering (IPO) in December 2023.

Shareholders and observers will track the progress of Uniclan Healthcare's legal challenge. The company's ability to manage the potential financial exposure, should its appeal be unsuccessful, will be a point of focus, although it currently anticipates no material impact.