GST order: INR 545.86 Million demand plus equal penalty; company to appeal

ideaForge has received an order under Section 74 of the CGST Act.

Fri 2 Oct 2026

Tax Liability Demanded

INR 545.86 Million

Penalty Demanded

INR 545.86 Million

Period Covered

January 2022 to March 2024

Alleged Short Payment

GST paid at 5% instead of a higher rate; differential of 13% claimed as short paid

Order Section

Section 74 of the CGST Act

What was disclosed

The company has disclosed an order received under Section 74 of the CGST Act, 2017 (read with the MGST Act, 2017 and the IGST Act, 2017). The order was passed by the Additional Commissioner CGST & Central Excise, Belapur.

• Tax liability demanded: INR 545.86 Million
• Penalty demanded: INR 545.86 Million
• Period covered: January 2022 to March 2024 (described in the update as 2022-24)

What the authority's claim is

The update states that the Authority claimed the company had wrongly discharged GST at 5% under Sl. No. 244 of Schedule I, and had thereby short paid GST by the differential rate of 13%.

The company's position

• The company says it made the necessary submissions against the show-cause cum demand notice.
• It also states that in 2025, the Government clarified that the GST rate for drones is 5%.

What the company plans to do

• In consultation with its tax advisors, it will file an appeal against the order with the appropriate Authority.
• It expects a favourable outcome at the Appellate forum.
• It says it will make further disclosures if any material update requires intimation.

Impact the company has stated

Based on the prevailing law and the company's judgement, it does not presently envisage any immediate material impact on its financials, operations or other activities arising from this matter until it is concluded.

How a retail investor may read this

• The headline figures to note are the tax demand and the penalty, each INR 545.86 Million, taking the total amount involved in the order to about double that single figure.
• An order of this kind is a demand, and the company has said it will contest it; the outcome at the appellate stage is what would determine any eventual money outflow.
• The company has characterised the matter as not having an immediate material impact, while also stating that the position is based on prevailing law and its own judgement until the matter is concluded.

Nothing here is a view, opinion or recommendation of ScoutQuest, its parent, directors or employees. ScoutQuest is a technology company: this page was assembled automatically from public sources using artificial intelligence, and may contain errors or omissions. Confirm everything against the original source before you act on it. Any use of this page is at your own risk, and neither ScoutQuest nor its parent, directors or employees accepts liability for it.