Image Source: The Economic Times
Kalpataru Projects International Ltd (KPIL), a renowned engineering, procurement, and construction (EPC) player, has faced a huge tax order worth ₹17.1 million. This move follows rising regulatory pressure, both globally and at home, as the firm extends its business into several sectors.
Key Points
Background
Kalpataru Projects International Ltd is a large EPC player active in industries like power transmission and distribution, buildings, water supply, railways, oil and gas pipelines, urban mobility, highways, and airports.
The company has recently obtained significant project orders, which depict its strong presence in the infrastructure segment.
Terms of the Tax Order
KPIL has obtained a tax order with a collective tax effect of ₹17.1 million.
The tax notice comprises liability, additional tax, and penalties for non-compliance or tax declaration discrepancies.
It is one of a series of recent tax notices issued to the company by foreign and domestic authorities.
Foreign Tax Notice
The Government of Afghanistan issued KPIL a tax notice for failure to submit declarations for FY 2020-21 and 2021-22.
The notice requires a tax liability of around ₹10.46 million, along with additional tax and penalties, which the company hopes may be waived if the main liability is paid.
Domestic Tax Notice
The Indian GST Authority also issued a notice to KPIL for over-claim of Input Tax Credit for FY 2019-20.
The notice seeks a total tax payment of ₹1.05 million and a fine of ₹0.15 million, along with more interest as sought.
Company Response
KPIL has accepted receipt of the tax notices and is liaising with authorities to fix the issues.
The company believes some of the fines and other taxes will be remitted following payment of the substantive tax obligations.
Market and Business Impact
Despite these regulatory hurdles, KPIL's business growth remains buoyant, with new order wins amounting to more than ₹2,366 crore, reaffirming its steady growth curve.
The success of the company in overcoming regulatory risks will be watched keenly by stakeholders and investors alike.
Sources of Relevance: Economic Times, Business Standard, Marketscreener, BlinkX
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