On August 31, 2024, Bayer CropScience Limited disclosed that it has received multiple orders imposing penalties for the financial year 2019-20 from various tax authorities across India. These penalties are related to GST on Outward Supply, Input Tax Credit availed, and E-Way Bill documentation.

1. Overview of the Penalty Orders: The company has been penalized by tax authorities from five different states: Haryana, Odisha, Assam, Andhra Pradesh, and Kerala. The penalties imposed range from Rs. 0.02 million to Rs. 0.57 million, totaling Rs. 1.47 million. Each order addresses specific violations or contraventions committed by the company in relation to GST compliance.

2. Details of the Penalties:

Haryana: The Deputy Excise and Taxation Commissioner of State Tax, Hisar, imposed a penalty of Rs. 0.29 million for issues related to GST on Outward Supply and Input Tax Credit.

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Odisha: The State Tax Officer of Cuttack imposed a penalty of Rs. 0.57 million for similar violations.

Assam: The Assistant Commissioner of State Tax, Guwahati, levied a penalty of Rs. 0.07 million.

Andhra Pradesh: The Assistant Commissioner of Central Tax and Central Excise imposed a penalty of Rs. 0.52 million for violations related to Input Tax Credit availed.

Kerala: The State Tax Officer from the Taxpayer Services Circle, Kottayam, issued a penalty of Rs. 0.02 million for E-Way Bill documentation issues.

3. Financial and Operational Impact: The penalties, though currently appealable, have implications for Bayer CropScience's financial reporting and operational activities. The company is currently evaluating the situation and assessing its options to appeal the orders. The outcome of these appeals could potentially alter the financial impact of these penalties.

4. Compliance and Corporate Governance: Bayer CropScience remains committed to complying with regulatory requirements and maintaining high standards of corporate governance. The company has assured stakeholders that it will take appropriate measures to address the issues highlighted in the penalty orders.

5. Conclusion: These penalty orders underscore the importance of strict compliance with GST regulations and the potential financial consequences of any lapses. As Bayer CropScience navigates this situation, it will focus on ensuring that such issues are rectified and prevented in the future, while also seeking to minimize the financial impact through potential appeals.

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