LG Electronics India gets GST relief as ₹117 crore tax, penalty demand dropped

South Korean electronics maker LG Electronics India Ltd on Thursday (July 2) said the GST authorities have dropped a proposed demand of ₹116.72 crore, including penalty, for FY2021-22 after deciding the matter in the company’s favour.The company received an order dated July 1, 2026 from the Joint Commissioner, GST – Corporate Circle-2, Greater Noida, Gautam Budh Nagar, Uttar Pradesh, in connection with a show cause notice issued on May 26, 2026 under Section 74 of the CGST Act, 2017 and the applicable provisions of the Uttar Pradesh GST Act, 2017.

The proposed demand comprised ₹58.36 crore towards principal tax and ₹58.36 crore as penalty, aggregating ₹116.72 crore. The GST Authority dropped the entire demand.ALSO READ | LG Electronics India shares fall over 6% from day’s high; Equity worth ₹66,000 crore free up for trade

The show-cause notice had alleged excess availment of input tax credit during FY2021-22 based on reconciliation differences between GST returns. The company said the allegations have now been adjudicated in its favour. LG Electronics India said there will be no financial, operational or other material impact on the company pursuant to the order.
Last month, LG Electronics India crossed 1 million air-conditioner sales in the first quarter of the calendar year 2026 and expects to exceed the 2 million-unit mark for the full year, Sanjay Chitkara, Director and Co-Chief Sales and Marketing Officer of the company, said.He added that channel inventory has normalised and retail partners are preparing for the festival season in the second half of the year. The company could outperform its financial year guidance if current demand trends continue, he said.

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The company is also looking to increase exports and expand its presence across product categories, including televisions, refrigerators and washing machines.

Chitkara said the company is benefiting from a strong summer season, improving consumer sentiment and easing external pressures. “AC has become a necessary household item these days, and the penetration of air conditioners is just 11%,” he said.

Atul Khanna, Chief Accounting Officer, added that the company remains committed to its guidance of mid-teen revenue growth and early double-digit earnings before interest, taxes, depreciation, and amortisation (EBITDA) margins for 2026, though current demand trends provide scope for improvement.

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Shares of LG Electronics India Ltd ended at ₹1,563.00, up by ₹2.45, or 0.16%, on the BSE.