Praveg Ltd Receives Show Cause Notice from GST Authorities Regarding ITC Utilization
Praveg Ltd confirmed the receipt of a Show Cause Notice (SCN) from the Goods and Services Tax (GST) Authorities. The notice, dated March 26, 2026, was received by the Company on April 7, 2026, via email. The action falls under Section 74 of the Central Goods and Services Tax Act, 2017, as read with applicable provisions of the Gujarat Goods and Services Tax Act, 2017 and the Integrated Goods and Services Tax Act, 2017.The matter relates to the financial year 2020-21. According to the details provided, the alleged violation involves the wrongful availment and utilization of inadmissible input tax credit (ITC).
A table details the specifics of the notice concerning the GST matter:
| Particulars | Details |
|---|---|
| Name of the Authority | Goods and Services Tax Department |
| Nature and Details of the Action | Issuance of Show Cause Notice dated March 26, 2026 under Section 74(1) of the Central Goods and Services Tax Act, 2017 read with applicable provisions of the Gujarat Goods and Services Tax Act, 2017 alleging wrongful availment and utilization of inadmissible input tax credit (ITC) for the financial year 2020-21. |
| Date of Receipt of Communication | April 7, 2026 (Show Cause Notice dated March 26, 2026 received via email) |
| Details of the Violation Contravention Alleged | The Company is alleged to have wrongly availed and utilized input tax credit on the basis of invoices issued by certain suppliers whose GST registrations were cancelled (including cases of cancellation ab-initio). As per the SCN, such ITC is considered inadmissible under Section 16 of the CGST Act, 2017, inter alia, on the grounds that the conditions prescribed under Section 16(2)(a) and 16(2)(c) were not fulfilled, including non-payment of tax by the suppliers to the Government. It is further alleged that the Company failed to reverse such ineligible ITC within the prescribed time and thereby contravened provisions of Section 39(7) of the CGST Act, 2017 read with Rule 85(3) of the CGST Rules, 2017. The SCN also alleges contravention of Section 50 of the CGST Act, 2017 in relation to non-payment of applicable interest on wrongful availment and utilization of ITC. |
| Financial Year(s) to which the matter relates | Financial Year 2020-21 |
| Amount Involved (as per SCN) | INR 19,10,758/- plus applicable interest and penalty (as may be determined) |
The amount involved, as specified in the SCN, totals INR 19,10,758/- plus applicable interest and penalty as may be determined.
Regarding the impact, the Company stated that it is evaluating the matter and does not foresee any immediate material impact on its financials, operations, or other activities.
In terms of its response, Praveg Ltd noted that it is currently reviewing the show cause notice. The Company believes it has complied with the applicable GST laws and regulations and possesses adequate grounds to substantiate its position, and consequently, a suitable response is being prepared for filing within prescribed timelines.
Stock Price Movement
At the close of trade, Praveg Ltd. settled at ₹199.70, advancing 0.25% for the session. The shares traded within a range today, touching a low of ₹196.00 and hitting a high of ₹205.00.Source:
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