Mega Flex Plastics Details Tax Litigation Update Following Calcutta High Court Ruling
Mega Flex Plastics Limited has provided details concerning a material litigation dispute related to the classification and taxation of its products, following a judgment passed by the Calcutta High Court.The legal dispute centers on the GST classification of polypropylene leno bags. The company initially had to make a payment of Rs. 6,57,38,093/- under protest, concerning a differential GST amount. This payment was necessitated by an order dated 25-10-2018 from the West Bengal Appellate Authority for Advance Ruling, which classified PP Leno Bags under Heading 63053300 (taxed at 5% or 12%), rather than the company's preference for Chapter Heading 39232990 (taxed at 18%).
The company subsequently filed an appeal against this order in the Hon'ble Kolkata High Court, which was pursued through W.P.3667(W) of 2019.
Most recently, the Hon'ble Division Bench of the Calcutta High Court delivered its judgment in the matter titled Mega Flex Plastics Limited & Anr. v. Union of India & Ors. (MAT 364 of 2023). The court determined that the bags manufactured by Mega Flex Plastics Limited fall under HSN3923 2900, establishing that the products are taxable at the rate of 18%. This ruling was communicated on 20-05-2026.
The following table summarizes the key details of the litigation:
| Particulars | Detail |
|---|---|
| Disputed Commodity | Polypropylene Leno Bags |
| Original Dispute | Classification under Heading 63053300 (GST @5% / 12%) vs. Chapter Heading 39232990 (GST @18%) |
| Initial Payment | Rs. 6,57,38,093/- (Paid under protest in FY 2018-2019) |
| Authority Ruling | Hon'ble Division Bench of the Calcutta High Court |
| Judgment Finding | Bags fall under HSN3923 2900, taxable at 18%. |
| Date of Order | 20-05-2026 |
Mega Flex Plastics Limited confirmed that since the company intends to file a Special Leave Petition (SLP) before the Supreme Court of India against the Division Bench's judgment, there is presently no further financial impact related to this matter.
MEGAFLEX Stock Price Movement
Shares of Mega Flex Plastics Limited today slipped by 4.98% to settle at ₹133.6. The stock finished the session lower, with trading activity recording a total volume of 2,000 shares.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
The information provided is for general informational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any securities. Readers are advised to rely on their own assessment and judgment and consult appropriate financial advisers, if required, before taking any investment-related decisions.
Any views, opinions, or statements expressed, where applicable, are those of the respective analysts or experts and do not reflect the views of this website. The website has no association with such viewpoints and does not assume any responsibility for them.