Tata Steel has received a favourable Income Tax Appellate Tribunal (ITAT) order for FY2009, allowing its claim for deduction of interest expenditure and reducing its tax exposure on the dispute by around ₹427 crore to ₹1,259 crore. According to latest reports, the Authority, vide order dated September 18, 2026 (received on September 28, 2026), has allowed the company's claim of deduction for interest expenditure under Section 36(1)(iii) of the Income Tax Act, 1961, in respect of loans borrowed for acquiring Corus Group Plc, its foreign subsidiary. The company believes these favourable orders will have a persuasive impact on the co-related pending litigations for the period FY2010 to FY2015 concerning the same issue.
The company had previously received a favourable order for FY2008 on February 20, 2026, allowing its interest expenditure deduction claim and covering a tax exposure of around ₹215 crore. As reported by CNBC TV18, the Deputy Commissioner of Income Tax had disallowed Tata Steel's claim of ₹813.65 crore towards deduction of interest expenditure under Section 36(1)(iii) through an order dated January 10, 2014. Following the FY2008 order, the company's tax exposure was expected to fall from around ₹1,901 crore to ₹1,686 crore once the Assessing Officer gives effect to the order through a separate consequential order. The latest FY2009 order has now further reduced this exposure to ₹1,259 crore.
The company made necessary disclosures to stock exchanges under Regulations 30 and 51 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 regarding the FY2009 order. According to CNBC TV18, Tata Steel made necessary disclosures to stock exchanges on February 28, 2026 regarding the FY2008 order. The company stated it will subsequently make necessary adjustments to the contingent liability reported in its financial statements. Shares of Tata Steel Ltd ended at ₹187.95, up by ₹1.95, or 1.05%, on the BSE following the announcement.
Tata Steel believes the two orders will have a persuasive impact on related pending litigations for FY2010 to FY2015 concerning the same issue. As reported by CNBC TV18, the company's aggregate tax exposure for the issue for FY2008 to FY2015 was around ₹1,901 crore. The company stated it will make necessary adjustments to the contingent liability reported in the notes to its financial statements following the latest FY2009 order.
