Castrol India Ltd said on Friday that it received a favourable order from Customs, Excise and Services Tax Appellate Tribunal in a Rs 4,131-crore dispute with Maharashtra Sales Tax Department.
The case was for the 2007-08 to 2017-18 period, during which the Maharashtra Sales Tax Department alleged that the lube making company's movement of goods from the state facilities to clearing and forwarding agents in other states constituted as inter-state sales based on the pre-existing customers.
However, the company contested this claim and stated that the goods were not dispatched under other prior orders and its tax methodology was in compliance with the legal norms. Castrol had already received favourable orders from the MVAT Tribunal for all 10 years under dispute.
The MSTD latter appealed to the clearing and forwarding agents for nine of the earlier claimed years, excluding the fiscal 2016-17. But the appeal was rejected on Friday and the order was in favour of the company.
The company in the exchange filing added that there will be no financial impact as it had not made any provisions for the Rs 4,131 crore in its books.
Share Price
The business update was shared after market hours. The stock settled 0.47% lower at Rs 219.89 apiece on the NSE, compared to a 0.87% decline in the benchmark Nifty 50.
Castrol's shares have fallen 11.91% over the past 12 months and risen 11.38% year-to-date.
Out of five analysts tracking the company, two maintain a 'buy' rating and three recommend a 'hold', according to Bloomberg data. The average 12-month consensus price target of Rs 233.40 implies an upside of 6.1%.
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