Shree Balaji (Mala) Textiles Ltd has settled its GST-related tax liabilities with the Directorate of Revenue Intelligence and Enforcement, West Bengal. Following an enquiry into FY24-FY26 filings, the company paid the full tax, interest, and penalties to close the matter. This action resolves outstanding regulatory demands stemming from a recent search operation.
Shree Balaji Textiles Settles GST Demand With DRI
Shree Balaji (Mala) Textiles has paid the full tax, interest, and penalty amounts demanded by the Directorate of Revenue Intelligence and Enforcement (DRI&E). The settlement follows a recent investigation into the company's GST compliance for the financial years 2023-24, 2024-25, and 2025-26.
Reader Takeaway: Quick settlement mitigates immediate regulatory risk, though stock-related accounting discrepancies remain a key internal watch point.
What just happened
Following a search operation initiated in September 2026, the company received a formal demand from the West Bengal DRI&E. On October 6, 2026, the firm completed all payments to settle the demand. The total outflow covers tax, interest, and penalties across three financial years.
Nature of the Enquiry
The regulatory body flagged three primary areas of concern:
- Stock Mismatch: Variances between final account figures and ledger books as of September 15, 2026.
- Taxable Value Mismatch: Differences between reported GST returns and audited financial statements regarding outward supplies.
- Credit Notes: Issues surrounding the documentation of sales returns, rate adjustments, and trade discounts.
Why this matters
By opting for an immediate settlement, the company has cleared the fiscal demand, effectively neutralizing the threat of further immediate enforcement actions regarding these specific discrepancies. For investors, this closure is a signal that management is prioritizing the resolution of administrative hurdles to avoid prolonged litigation.
Context of Payments
The settlement amounts were as follows:
- FY 2023-24: Total tax of Rs 9.98 lakh with corresponding interest and penalties.
- FY 2024-25: Total tax of Rs 1.17 lakh with corresponding interest and penalties.
- FY 2025-26: Total tax of Rs 1.24 lakh with corresponding interest and penalties.
What to track next
Investors should monitor future quarterly disclosures for any improvements in internal accounting controls. The company's ability to maintain cleaner documentation regarding stock levels and taxable supplies will be critical in avoiding similar regulatory scrutiny in the coming quarters.