GST show cause notice over alleged ₹266.32 crore input tax credit disallowance

Company received a GST show cause notice from the Additional Commissioner, CGST & Central Excise, Vadodara-II Commissionerate, alleging disallowance of input tax credit of ₹266.32 crore for FY 2022-23 and 2023-24.

Thu 1 Oct 2026

Alleged ITC disallowance / demand

₹266.32 crore

Financial years covered

FY 2022-23 and 2023-24

Notice issuing authority

Additional Commissioner, CGST & Central Excise, Vadodara-II Commissionerate

Notice date

September 29, 2026

Provision invoked

Section 73 of the CGST Act, 2017

The company has disclosed a show cause notice from the GST authorities to the exchanges. Here is what the update says.

What the company informed

The company has received a show cause notice from the Additional Commissioner, CGST & Central Excise, Vadodara-II Commissionerate, issued under Section 73 of the Central Goods and Services Tax Act, 2017. The notice is dated September 29, 2026.

What the notice alleges

• The department has alleged that certain input tax credit availed by the company is not eligible.
• The stated reason is a mismatch between the ITC claimed in the statutory GST returns and the ITC reflected in the auto-generated statement available on the GST portal.
• A demand of GST along with applicable interest and penalty has been proposed.
• The alleged disallowance covers the financial years 2022-23 and 2023-24 and aggregates to ₹266.32 crore.
• Against the point on quantum of claims, the company has stated "Not Applicable".

The company's stated position

• The company is reviewing the notice and will submit an appropriate response before the concerned authority.
• The company believes the allegations are not legally tenable and intends to contest the matter before the appropriate legal forum.
• In its view, the show cause notice is not sustainable and will have no financial impact.

What a show cause notice means

A show cause notice is a formal communication from the authority asking the company to explain why the proposed demand should not be confirmed. It is not a final order. The company has the opportunity to reply and contest the matter in the appropriate forum, and any liability gets determined only after that process.

The number to note

The alleged disallowance of input tax credit for the financial years 2022-23 and 2023-24 aggregates to ₹266.32 crore. The company's stated view is that the notice is not sustainable and will have no financial impact.

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