Tata Steel Initiates Legal Challenge Over GST Penalty in Tax Dispute Before Appellate Authority

Tata Steel Initiates Legal Challenge Over GST Penalty in Tax Dispute Before Appellate Authority​

Tata Steel Limited is currently contesting a penalty amount related to a Goods and Services Tax (GST) dispute before the Commissioner (Appeals) of CGST & Central Excise, Ranchi. The appeal follows an earlier adjudication order concerning tax liabilities for periods spanning FY2018-19 through FY2022-23, which is simultaneously under judicial review in the High Court of Jharkhand.

The dispute originated from a show cause cum demand notice (SCN) dated June 27, 2025, issued by the Office of the Commissioner (Audit), Central Tax, Ranchi. The notice proposed disallowance of Input Tax Credit in contravention of GST laws for the specified period.

According to the company's disclosure, the total alleged GST exposure amounted to ₹1007,54,83,342/-. Of this aggregate amount, Tata Steel had already paid GST amounting to ₹514,19,36,211/-, leaving an alleged GST exposure of ₹493,35,47,131/-.

The company submitted detailed replies to the appropriate forum in response to the SCN and subsequently received an Adjudication Order from the Commissioner of CGST & Central Excise, Jamshedpur, Jharkhand on December 18, 2025. This order directed the payment of tax amounting to ₹493,35,47,131/-, along with a penalty of ₹638,82,62,185/- and appropriate interest on the total amount of tax. The Adjudicating Authority, however, had dropped an initial proposed penalty amount of ₹368,72,21,158/-.

Litigation Timeline and Status​

Tata Steel subsequently initiated legal action to challenge the Adjudication Order.

A timeline of the key actions related to the tax matter is as follows:


The current appeal initiated by the Department pertains specifically to the penalty amount of ₹368,72,21,158/-, which was dropped in the initial Adjudication Order.

Tata Steel has stated that while it is contesting the issue before the Appellate Authority within statutory timelines, this matter remains contingent upon the final adjudication of the original GST liability issue currently sub judice before the Hon'ble High Court. The company added that there is no impact on the financial or operational activities stemming from the said appeal.

TATASTEEL Stock Price Movement​

Shares of Tata Steel Limited slipped by 0.82% on Thursday, finishing at ₹188.71 after shedding ₹1.56 from the previous close. The stock recorded a volume of 34.15 million shares during trading on the day.