Mega Flex Plastics Limited Reports on GST Litigation After Calcutta High Court Judgment
Mega Flex Plastics Limited has disclosed material details regarding a long-standing classification dispute concerning its polypropylene leno bags, following a judgment issued by the Hon'ble Division Bench of the Calcutta High Court. The litigation pertains to whether the product falls under HSN 3923 2900, taxable at 18%, or HSN 6305 33 00, taxable at 5%.The dispute originated when, for the quarter ending December 31, 2024, the Company made a payment under protest. This payment amounted to Rs. 6,57,38,093/-, representing differential GST. This payment followed an order dated October 25, 2018, issued by the West Bengal Appellate Authority for Advance Ruling. The Authority had classified PP Leno Bags under Heading 6305 33 00 (GST @5%) instead of the Chapter Heading 3923 2990 (GST @18%). The Company subsequently filed an appeal against this order, which remained pending before the Division Bench of the Hon'ble Kolkata High Court.
The Hon'ble Division Bench of the Calcutta High Court pronounced its judgment in the case, Mega Flex Plastics Limited & Anr. v. Union of India & Ors. (MAT 364 of 2023). The Court held that the bags manufactured by the Company correctly fall under HSN 3923 2900, and are therefore taxable at the rate of 18%.
The key details of the litigation, including the judicial outcomes and the payment details, are summarized below:
| Detail | Description/Outcome |
|---|---|
| Dispute Basis | Classification of polypropylene leno bags (HSN 6305 33 00 vs. HSN 3923 2900). |
| Authority | Hon'ble Division Bench of the Calcutta High Court. |
| Date of Order | May 20, 2026. |
| Amount Paid (Under Protest) | Rs. 6,57,38,093/- (for quarter ending 31-12-2024). |
| Core Ruling | The Court held that the bags fall under HSN 3923 2900 and are taxable at 18%. |
Regarding the current financial impact, the Company noted that the disputed amount had already been paid under protest in Fiscal Year 2018-2019. As the Company intends to file a Special Leave Petition (SLP) before the Supreme Court of India against the judgment passed by the High Court, there is currently no financial impact on the listed entity.
MEGAFLEX Stock Price Movement
As of 1:49 PM, shares of Mega Flex Plastics Limited are holding steady at ₹140.6, maintaining a flat performance with zero percentage change in live trading. The stock is currently trading within a defined range of ₹133.60 to ₹147.60 during the day's session.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.