Jubilant Pharmova Limited, a leading pharmaceutical and life sciences company, has informed the stock exchanges about a significant regulatory development concerning its wholly-owned subsidiary, Jubilant Biosys Limited. On September 2, 2025, the company disclosed under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 that Jubilant Biosys has received three Orders-in-Appeal relating to recurring refund issues under the Goods and Services Tax (GST) framework.

The appeals were decided by the Additional Commissioner of Central Tax (Appeals), Mysuru, who upheld the position of the GST Department and disallowed refunds previously sanctioned to Jubilant Biosys. The disputed refund amount stands at ₹43.83 crore. This move, according to the company, is based on technical grounds such as the application of the wrong refund rule and discrepancies in calculations.

However, Jubilant Pharmova has clarified that these orders are legally unsustainable, citing the fact that Rule 89(4B) of the Central Goods and Services Tax (CGST) Rules—one of the grounds cited in the orders—was deleted as of October 8, 2024. The company further highlighted that various High Courts across India have already ruled that when a rule is omitted without a saving clause, any proceedings under the omitted rule cannot be continued.

Key details of the disclosure

The disclosure submitted to BSE (Scrip Code: 530019) and NSE (Symbol: JUBLPHARMA) outlines the following:

1. Nature of the Orders-in-Appeal:

   • Jubilant Biosys received three Orders-in-Appeal dated August 29, 2025, which were officially received on September 1, 2025.

   • The orders disallowed previously sanctioned GST refunds amounting to ₹43.83 crore.

2. Grounds for disallowance:

   • The GST Department argued that refunds were wrongly claimed under Rule 89(4) instead of Rule 89(4B).

   • Alleged discrepancies were also noted in some refund calculations.

3. Company’s stance:

   • Jubilant Biosys strongly disagrees with the orders, stating that they are legally incorrect and flawed in interpretation.

   • The company emphasized that Rule 89(4B) had been deleted and therefore could not be applied retrospectively.

   • Refunds were earlier verified and sanctioned by the competent GST authorities.

4. Proposed action:

   • Jubilant Biosys will file a detailed appeal before the Goods and Services Tax Appellate Tribunal (GSTAT).

   • The company maintains that it has a very strong case on merits.

5. Financial impact:

   • The company has stated that there will be no financial or operational impact, given the strong legal standing and past precedents.

Broader implications

The development highlights the continuing challenges that Indian companies face in navigating the GST refund process, particularly in sectors like pharmaceuticals and biotechnology, where export-linked incentives and refunds form a critical part of working capital management.

Jubilant Biosys, being a contract research and development arm of Jubilant Pharmova, is engaged in providing integrated drug discovery and development solutions to global pharmaceutical companies. The GST refunds in question relate to input tax credits and export-related refunds, which are common areas of dispute between businesses and tax authorities.

The ₹43.83 crore claim is not insignificant, but Jubilant Pharmova’s assurance of no material financial impact reflects its confidence in securing relief through the appellate process.

Legal perspective

The dispute primarily revolves around the interpretation and applicability of CGST Rule 89, which deals with refund of taxes. Rule 89(4B), in particular, had earlier imposed restrictions on refund claims in specific cases. Its deletion in October 2024 means that refund claims should no longer be tested against this provision.

Courts have consistently held that when a legal provision is deleted or omitted without a saving clause, all actions under that provision should cease from the date of omission. Jubilant Biosys is likely to rely heavily on such precedents in its appeal before GSTAT.

Furthermore, the company has pointed out that refund claims had been duly verified and sanctioned by GST officers at the time of processing, which strengthens its argument that the disallowance at the appellate stage is unjustified.

Impact on Jubilant Pharmova shareholders

For investors and shareholders, the disclosure provides transparency on ongoing litigation risks. The company’s proactive communication assures the market that:

• The refunds in question will not materially impact cash flows or profitability.

• Jubilant Biosys is pursuing the matter through appropriate legal channels.

• The disclosure complies with SEBI’s regulatory framework, ensuring that all stakeholders are informed of material developments.

Given the company’s confidence in its legal position, the stock market reaction may remain muted, unless prolonged litigation creates uncertainty in the future.

Conclusion

The disclosure by Jubilant Pharmova Limited demonstrates the company’s commitment to transparency and regulatory compliance. While the immediate disallowance of ₹43.83 crore in GST refunds may appear significant, the company’s detailed explanation suggests that it has a strong chance of success in appeal.

By moving the matter to the Goods and Services Tax Appellate Tribunal (GSTAT), Jubilant Biosys is seeking to protect its financial interests while also reinforcing confidence among stakeholders.

As the case progresses, investors will be closely monitoring the outcome, but based on the current disclosure, no adverse financial or operational consequences are anticipated for the company.

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