Why Patanjali Foods Get GST Notice? (Image Source: Today Technology Market ResearchDigital)
In a big setback for Patanjali Foods, led by Yoga guru Ramdev, the company is facing scrutiny from the GST intelligence department. They have been issued a show cause notice, demanding an explanation as to why input tax credit worth Rs 27.46 crore should not be recovered from them.
How Notice Disclosed?
As per the Patanjali Foods regulatory filing, the notice is served by the Directorate General of GST Intelligence, Chandigarh Zonal Unit. It came to light by the company in a regulatory filing on April 26.
Company Response
In response to the notice, the company stated, “A show cause notice is received by the company… requiring the company, its officers and authorised signatories to show cause as to why input tax credit amounting to Rs 27,46,14,343 should not be recovered (along with interest), and why penalty should not be imposed…”
What Are The Reference Sections?
The notice references Section 74 and other relevant provisions of the Central Goods and Services Act, 2017, Uttarakhand State Goods and Services Act, 2017, along with Section 20 of the Integrated Goods and Services Tax (IGST) Act, 2017.
What Will Be The Next Step Of Patanjali Foods?
In response to this question, Patanjali Foods emphasized that they will take necessary steps to defend their case before the authority. They mentioned, “… expected financial implications cannot be determined till the completion of the proceedings.”
Patanjali Foods To Acquire Patanjali Ayurved?
Additionally, Patanjali Foods recently disclosed their consideration of a proposal to acquire the non-food business of their promoter group, Patanjali Ayurved.
The company’s board has reviewed an initial proposal from Patanjali Ayurved Ltd for the sale of the latter’s non-food business undertaking to Patanjali Foods.
When Was Patanjali Food Established?
Established in 1986, Patanjali Foods Ltd, previously known as Ruchi Soya Industries Ltd, is a significant FMCG player.
What Are The Products Of Patanjali Foods?
They operate in edible oils, food, and FMCG, and wind power generation segments under brands like Patanjali, Ruchi Gold, Nutrela, among others.
Acquisition Of Ruchi Soya
Patanjali Ayurved acquired Ruchi Soya through the insolvency process and subsequently renamed it as Patanjali Foods Ltd.
