Emmvee Photovoltaic Power Subsidiary Hit With Rs 38.45 Crore GST Demand

Tax Demand: Rs 20.39 Crore | Total Aggregate Liability: Rs 38.44 Crore

Reader Takeaway: The company denies tax evasion allegations and plans to challenge the notice through formal legal channels.

What just happened

Emmvee Photovoltaic Power Ltd has disclosed that its subsidiary, Emmvee Energy Private Limited, received a show cause notice from the Karnataka State GST Department on September 30, 2026. The authorities have raised concerns regarding the company's availment of Input Tax Credit (ITC) during the 2022-23 financial year.

Demand Details

The tax department has calculated a total liability of Rs 38.44 crore. This figure includes a tax demand of Rs 20.39 crore, interest charges of Rs 16.02 crore, and a penalty of Rs 2.04 crore.

Company Response

Management has formally rejected the findings, stating that the allegations are unsustainable. The company maintains that it has only claimed eligible ITC of Rs 11.51 crore as per existing GST regulations. The company is preparing a detailed response to the authority and will pursue legal recourse to defend its position.

Risks to watch

While the company has signaled that it does not expect a material financial impact, regulatory disputes can be time-consuming and may lead to prolonged uncertainty. Investors should track the company's progress in resolving these proceedings and any further communications from the GST department.

What to track next

The primary monitorable is the upcoming formal submission by the company to the GST authorities and any subsequent order passed by the department regarding the contested liability.