BALCO, the Vedanta arm, receives a GST demand notice of Rs 84 crore

26 Dec 2023 , 02:19 PM

On December 23, Vedanta announced that Bharat Aluminium Company Limited (BALCO), one of its subsidiaries, had received a demand notice for Rs 84 crore in Goods and Services Tax (GST).

According to a regulatory filing by the mining major, ‘various interpretational issues under the relevant provisions of the Central Goods and Services Tax Act, 2017’ are the reason for the demand notice that was issued by the ‘Office of the Joint Commissioner, Bilaspur’ and concerns the fiscal year 2017–18.

The company stated that it has been requested to pay ‘Rs 84,70,09,977’ in total GST along with relevant interest and a penalty of 10% of this sum.

According to the exchange filing, BALCO is currently assessing the best course of action to take in this situation. It added that neither the company nor its parent Vedanta anticipate any significant financial effects from the order.

Once a government-owned company, BALCO was acquired by Vedanta in 2001 when the Union Mines Ministry sold off 51 percent of its ownership interest.

According to reports from June of this year, the government was looking into ways to sell off some of its 49 percent ownership in the company in order to further cut its holding.

The Korba in Chhattisgarh is in the core of BALCO’s main operations. The company supplies high-grade bauxite from its mines, which are located in Mainpat and Kawardha.

The company’s earnings after tax for the fiscal year ended March 31, 2023, was Rs 42 crore, a sharp decline from the previous year’s profit of Rs 2,736 crore. Comparing FY22 to FY23, the total comprehensive income was Rs 75 crore versus Rs 2,720 crore.

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