Sheela Foams Faces Rs 20.26 Crore GST Demand, Stock Slumps 4%

5 Oct 2023 , 11:26 AM

Sheela Foam Limited, the maker of Sleepwell mattresses, saw a 4% stock price decline to Rs 1,062 on October 5 due to a GST notice. The notice, under section 16 of the CGST Act, demands Rs 20.26 crore in tax, with an equivalent penalty and applicable interest, citing improper credit utilization and incorrect tax credit claims.

Early trade on October 5 saw shares trading at Rs 1,093, down 1.5% from the previous day’s close on NSE. The investigation focuses on alleged improper transitional input credit usage and incorrect GST-related input tax credit claims.

The company has been asked to justify why Rs 20.26 crore GST should not be collected as per Section 16, with a proposed penalty and interest.

Sheela Foam Limited stated they would provide a fitting response within stipulated timelines. On October 4, Winro Commercial India sold Sheela Foam shares worth Rs 93 crore in an open market transaction.

The block deal data from NSE indicates the sale involved over 8.34 lakh shares at an average price of Rs 1,114 each. The stock closed at Rs 1,103.20 on October 4, marking a 14% decline for the year.

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