HUL Files Plea In Bombay High Court Against Rs 963 Crore Tax Demand
Hindustan Unilever Ltd. on Friday filed a writ petition in the Bombay High Court challenging an assessment order worth Rs 963 crore, received in August 2024. The company filed a writ petition before the Bombay High Court challenging the assessment order and the accompanying demand notice issued by the Income Tax Authorities, according to a statement to the exchanges.
"This is further to our letter dated Aug. 26, 2024, intimating about the Assessment Order dated Aug. 23, 2024, whereby a demand of Rs 962.75 crores (including interest of Rs 329.33 crores) was raised on the company on account of non-deduction of TDS while making remittance for payment towards acquisition of India HFD IPR from GlaxoSmithKline ‘GSK' Group entities," according to the statement.
The statement comes after the FMCG company received a demand of Rs 962.75 crore from the Income Tax Department on account of non-deduction of tax deducted at source as per tax laws last month. The demand includes interest of Rs 329.3 crore.
The tax demand pertains to the TDS not paid on a remittance of Rs 3,045 crore (375.6 million euro) for payment towards acquisition of India HFD IPR from GlaxoSmithKline ‘GSK' Group entities.
HUL had acquired GlaxoSmithKline's health-food-drinks (HFD) portfolio, which includes the Horlicks brand, in 2018. This acquisition covered India, Bangladesh, and 20 other predominantly Asian markets.
Shares of HUL closed 0.60% lower at Rs 2,938.70 apiece, compared to a 0.13% decline in the NSE Nifty 50 Index on Friday. The stock has returned 19.3% so far this year.
Twenty-four out of 42 analysts tracked by Bloomberg had a 'buy' call on the stock, while 13 analysts had a 'hold' call and five had a 'sell' rating. The analyst consensus 12-month price target tracked by Bloomberg was Rs 2,899.20, implying a potential decline of 1.2% from the last closing price.
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