Zydus Lifesciences Limited on Thursday (September 25) said the central goods and services tax (CGST) authorities have concluded proceedings on tax demands totalling ₹39.25 crore. Of this, demands worth ₹35.90 crore were dropped, while a liability of ₹3.35 crore, along with interest and penalty, was confirmed.
The company had earlier received multiple show-cause notices from the central excise and service tax authorities regarding alleged wrongful availment of CENVAT credit on input services for the period March 2008 to June 2017.
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Following oral and written submissions, the authorities dropped most of the demand. However, the Commissioner of CGST, Ahmedabad, in an order dated September 19, 2025, confirmed the ₹3.35-crore demand related to CENVAT credit on sales commission paid to foreign entities, treated as business auxiliary services under Rule 14 of CENVAT Credit Rules, 2004, read with Section 11A of the Central Excise Act, 1944.
The order was communicated to the company on September 24. Zydus Lifesciences said it will challenge the order by filing an appeal and added that there is no material financial impact on its operations.
Shares of Zydus Lifesciences Ltd ended at ₹1,018.90, down by ₹16.30 or 1.57%, on the BSE today, September 25.
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First Published: Sept 25, 2025 5:39 PM IS
