Akzo Nobel India Limited has received a dramatically reduced GST demand order from the Karnataka GST Department, providing substantial relief in an ongoing tax dispute. According to the company's regulatory filing on January 1, 2026, the final order shows the total demand reduced to ₹41,56,861 from the initial demand of ₹17,66,46,778, representing a reduction of over ₹17.24 crores. The Assistant Commissioner of Commercial Taxes, LGSTO LTU, Large Taxpayers Unit, Bangalore issued the final order dated December 30, 2025. This represents approximately a 98% reduction in the total demand amount, offering significant financial relief to the paints and coatings manufacturer.
In a separate development, Akzo Nobel India Limited has successfully resolved its GST litigation with the Gujarat GST Department, receiving complete relief from a tax demand of ₹4.36 lakh including interest and penalty. The case involved allegations of duplicate e-way bill issuance for the period April 2018 to March 2019. The Superintendent of Ahmedabad Gujarat GST Department issued a favorable order dated December 23, 2025, completely dropping all demands after reviewing the company's response and supporting documentation.
The substantial relief in Karnataka is evident across all components of the GST demand. As reported in the company's filing, the tax amount was reduced from ₹5,65,17,926 to ₹12,89,949, while interest charges decreased from ₹6,36,10,926 to ₹15,76,963. The penalty component saw a similar reduction from ₹5,65,17,926 to ₹12,89,949. This comprehensive reduction across tax, interest, and penalty components demonstrates the effectiveness of the company's defense strategy and documentation provided to the authorities.
Akzo Nobel India Limited has also received a GST notice from Tamil Nadu authorities for alleged defects in transport documentation. The notice, issued by the Deputy State Tax Officer, Vellore, Roving Squad under Section 68 of the CGST Act/Rules, 2017, imposes a penalty of ₹5,19,840 following physical verification of transport documents. The company is preparing to respond to this notice within the stipulated timeframe and views the matter as being at the notice stage, open for further submissions.
The Karnataka tax dispute originated from a show cause notice issued on June 27, 2025, pertaining to the disallowance of input tax credit under Section 74 of the CGST/SGST Act, 2017, covering the period from April 2018 to March 2019. Similarly, the Gujarat case also stemmed from a show cause notice issued on the same date regarding duplicate e-way bill allegations for the identical period. Akzo Nobel India had submitted comprehensive responses along with supporting documents within the stipulated time limits for both cases, demonstrating proactive compliance management.
The Karnataka order remains open for further submissions to the relevant authorities, indicating potential for additional relief. The company is preparing its response within the indicated timeframe for the Tamil Nadu notice while maintaining its commitment to regulatory compliance. All disclosures have been made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, ensuring transparency with stakeholders regarding material litigation updates. The company maintains consistent regulatory compliance throughout these dispute resolution processes across multiple states.
