Mahindra Holidays gets Rs.11.34 crore GST show-cause notice over alleged tax shortfall
Mahindra Holidays & Resorts India said on Wednesday (August 26) that it has received a GST show-cause notice seeking Rs.11.34 crore for the financial years 2020-21 to 2023-24.
The notice, issued by the Additional/Joint Commissioner, Central GST Audit, Dehradun, was received by the company on August 25, according to an exchange filing.
The amount comprises a tax demand of Rs.11.33 crore and a penalty of Rs.50,000. The demand primarily relates to an alleged short payment of tax on services supplied in Uttarakhand and differences in turnover reported by the company.
The notice has been issued under the Central Goods and Services Tax Act, 2017, and the Uttarakhand Goods and Services Tax Act, 2017.
Mahindra Holidays said that, based on its assessment and advice from legal counsel, it does not expect the matter to have a material financial impact on the company.
The company said it is taking appropriate steps to pursue legal remedies before the relevant authority.
What does the GST notice mean?
The Rs.11.34 crore mentioned in the disclosure is a proposed demand and not necessarily the amount Mahindra Holidays will ultimately have to pay.
A show-cause notice gives the company an opportunity to respond to the tax department's allegations and explain why the proposed tax and penalty should not be imposed. The authorities can consider the company's submissions before passing a final order.
The notice therefore marks the beginning of a dispute process rather than a final determination of Mahindra Holidays' tax liability.
The company has indicated that it intends to contest the matter and does not expect the proceedings to materially affect its finances.
Mahindra Holidays' business
Mahindra Holidays & Resorts India operates the Club Mahindra vacation-ownership business and is part of the Mahindra Group. The company offers holiday memberships that provide customers access to its network of resorts in India and overseas.
Shares of Mahindra Holidays & Resorts India ended 1.99% lower at Rs.217.11 on the NSE on Wednesday.
