No Fertile Grounds for Tax Claim, Says Deepak Fertilizers on Rs 28.8 Cr Order

Updated: October 31, 2025 23:19

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Deepak Fertilizers’ material subsidiary Mahadhan AgriTech Limited received a demand order from the Joint Commissioner of State Tax, Maharashtra, raising a total claim of Rs 28.79 crore for FY 2017–18. The company maintains that the demand is untenable and will challenge the order, asserting no material financial or operational impact.

Deepak Fertilizers and Petrochemicals Corporation Ltd has announced that its wholly owned subsidiary Mahadhan AgriTech Limited (MAL) has received a demand order from the Joint Commissioner of State Tax, Maharashtra, pertaining to the period between July 2017 and March 2018. The total claim raised amounts to Rs 28.79 crore, comprising tax, interest, and penalty.

The order, received via email on October 31, 2025, follows the first appeal proceedings under Rules 113(1) and 115 of the CGST/SGST Rules, 2017. The issue centers around alleged inadmissibility of input tax credit (ITC) claimed in GSTR-3B, compared to the credit reflected on the GSTN portal during the relevant period.

Both MAL and its parent company have asserted that the demand lacks merit and intend to pursue legal remedies, including appeal before an appropriate forum. They further clarified that the order does not materially impact the company’s financials or operations.

Key highlights

The Joint Commissioner of State Tax, Maharashtra, passed an Intimation of Demand Order against Mahadhan AgriTech Limited for Rs 28.79 crore.
The breakdown includes Rs 12.94 crore as tax, Rs 14.56 crore as interest, and Rs 1.29 crore as penalty.
The order pertains to discrepancies in ITC claimed during FY 2017–18 under the GST framework.
Mahadhan AgriTech, a wholly owned subsidiary of Deepak Fertilizers, received the order via email on October 31, 2025.
The company reaffirmed that there is no material impact on financials or day-to-day operations.
Deepak Fertilizers stated it would challenge the order, citing that the demand is not legally sustainable.

Industry analysts view this as part of broader tax authority scrutiny post-GST rollout, with companies contesting credit mismatch demands that often arise from system-level discrepancies rather than deliberate non-compliance.

Sources: BSE filing by Deepak Fertilizers and Petrochemicals Corporation Ltd; Disclosure to National Stock Exchange (NSE); Maharashtra State Tax Department communication.

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