In a recent development, Alkem Laboratories Limited has informed the BSE and NSE regarding the receipt of a GST demand order from the Assistant Commissioner of Central Tax and Central Excise, Amaravathi CGST Divisional Office, Vijayawada. The order, dated 27th December 2024, alleges that the company has excessively availed GST Input Tax Credit for the period between financial year 2017-2018 and 2022-2023, resulting in a demand for Rs. 1,31,67,123 along with a penalty of Rs. 1,32,17,123 and applicable interest under the CGST/SGST/IGST Act, 2017.

Details of the Order and Allegations

According to the order, the alleged violation concerns the excess availment of the GST Input Tax Credit over the aforementioned period. The company's management has expressed disagreement with the order and plans to contest it. Alkem Laboratories intends to take appropriate actions, which include filing an appeal against the order in order to ensure that the issue is resolved in their favor.

Alkem Laboratories has also made this disclosure under Regulation 30 of the SEBI LODR Regulations, as required for publicly listed companies. This ensures full transparency regarding the company’s legal proceedings and compliance with stock exchange regulations. The details of the disclosure are available on the company’s official website.

Company's Response to the GST Demand

The company has stated that while the demand order has been received, it does not anticipate any material impact on the financial, operational, or other activities of the company. The company’s legal team is currently reviewing the order, and Alkem Laboratories is in the process of filing an appeal to contest the GST demand and penalty.

It’s important to note that Alkem Laboratories has a history of compliance with tax laws, and this order is being viewed as an isolated incident. The company is confident that the matter will be addressed through legal channels, and the final outcome will be in their favor. The company remains committed to adhering to GST regulations and maintaining the integrity of its operations.

Impact on Financial and Operational Activities

While the demand order may seem significant on paper, Alkem Laboratories has assured stakeholders that the financial and operational impact will be minimal. The company has a robust financial position and is confident that the appeal process will resolve the issue without any material disruptions to its business. The management has emphasized that the company's operations will continue as usual while the legal process is underway.

Furthermore, Alkem Laboratories has clarified that the appeal will be filed promptly, and they will continue to work closely with the authorities to address any discrepancies in the order. The company is committed to resolving the issue in a timely manner, ensuring compliance with GST laws while safeguarding its financial interests.

Alkem Laboratories Overview

Alkem Laboratories is a leading global pharmaceutical company based in India, known for its innovative and high-quality products. The company is listed on both the BSE and NSE, under the stock symbols Scrip Code: 539523 and Scrip Symbol: ALKEM, respectively. With a strong market presence and a reputation for excellence in the pharmaceutical industry, Alkem Laboratories continues to focus on growth, innovation, and compliance in its operations.

Despite this recent challenge, the company is expected to continue performing strongly in the market, driven by its solid financial foundation and strategic approach to business operations.

For more insights on Alkem Laboratories, latest legal updates, and stock market developments, check out our latest IPO reviews and business news on our website.

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