GST show cause cum demand notice over alleged excess availment and utilisation of input tax credit

WeWork India received a show cause cum demand notice from CGST & CX, Mumbai East for alleged excess input tax credit availment of ₹11,01,28,801 for April 2021 to March 2023.

Thu 1 Oct 2026

Notice Amount (ITC Demand)

₹11,01,28,801

IGST Component

₹5,95,97,913

CGST Component

₹2,52,65,444

SGST Component

₹2,52,65,444

Period Covered

April 2021 to March 2023

What the company has disclosed

• The company received a Show Cause-Cum-Demand notice dated September 29, 2026. According to the disclosure, it received the notice on September 30, 2026.
• The notice was issued by the Additional Commissioner, In-charge of Division IV, Office of the Principal Commissioner of CGST & CX, Mumbai East.
• It covers the period April 2021 to March 2023 and was issued under Section 74(1) of the CGST Act, 2017, read with the corresponding provisions of the MGST Act, 2017 and Section 20 of the IGST Act, 2017.

What the notice says

• The dispute is about alleged excess availment and utilisation of Input Tax Credit (ITC).
• The allegation arises from the difference between ITC claimed in the Annual Return (FORM GSTR-9) and ITC reflected in the audited financial statements/books of accounts.
• The notice requires the company to show cause.

The amounts involved

• Disallowance and recovery of ITC amounting to ₹11,01,28,801.
• This is made up of ₹5,95,97,913 (IGST), ₹2,52,65,444 (CGST) and ₹2,52,65,444 (SGST).
• Applicable interest on the above demand under Section 50(3) read with Section 74(1) of the CGST Act.
• Applicable penalty on the above demand under Section 74(1) read with Section 122(2)(b) of the CGST Act.

What the company says about the impact

• The company believes the notice has been issued without adequately considering the merits of the case.
• It is in the process of submitting a detailed response within the prescribed statutory timelines.
• It says it will adequately substantiate the legitimate reasons for the reconciliation differences in the ITC between the Annual Returns and the audited books of accounts.
• On that basis, the company states it does not envisage any material impact on its financials, operations or other activities at this stage.

How a retail investor can read this

• The notice sets out a proposed disallowance of ITC together with interest and penalty; the exact amount of interest and penalty is not quantified in the disclosure.
• The company's stated position is that the matter is at the show cause and response stage and that no material impact is expected at this stage.
• The key things to watch are the company's response to the notice and any subsequent development in this GST matter.

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