Nephrocare Health Services Ltd has secured a legal victory as a Tashkent court invalidated a ₹14.79 crore tax demand against its subsidiary, citing procedural audit irregularities. While this provides immediate relief, the tax authorities must now reconsider the audit, keeping investors on watch for further updates.
Nephrocare Health Services Subsidiary Wins Tax Court Ruling
The invalidated tax demand totals ₹14.79 crore, including a ₹11.50 crore net tax and a ₹3.29 crore penalty.
The ruling identifies critical procedural lapses in the audit process by Uzbekistan tax authorities.
Reader Takeaway: Subsidiary relief from ₹14.79 crore tax claim; however, authority-led audit reconsideration remains a pending legal process.
What just happened
Nephrocare Health Services Ltd announced that its wholly-owned subsidiary, Nephrocare Health Services Central Asia LLC (NCA), successfully challenged a tax assessment in the Tashkent Inter-District Administrative Court. The court ruled on October 27, 2026, to invalidate Decision No. 721.1 issued by the Tax Department on August 24, 2026.
Why this matters
The court found that the original tax audit suffered from significant procedural irregularities. Specifically, the authorities failed to provide prior notice, unlawfully extended the audit period beyond its expiration, and excluded the subsidiary from the review process. By declaring the decision invalid, the court has effectively canceled the immediate obligation of the ₹14.79 crore demand, comprising ₹11.50 crore in taxes and ₹3.29 crore in penalties.
What changes now
The Tax Department has been directed to initiate a reconsideration of the audit materials. Crucially, the court has mandated that this new process cannot place the subsidiary in a position worse than it occupied under the invalidated decision. The authorities have 30 days to complete this review, though they retain the right to appeal the court's decision to the Tashkent City Administrative Court within one month.
Risks to watch
While the immediate financial burden is removed, the regulatory matter remains technically open. Investors should watch for the outcome of the Tax Department's reconsideration and any potential appeal proceedings, which could prolong the resolution timeline.
What to track next
Monitor future BSE filings for updates on the Tax Department’s reconsideration process or notices of appeal from the Tashkent regulatory authorities.