Panacea Biotec subsidiary faces Rs.4.06 Cr GST notice over excess ITC
Panacea Biotec Limited disclosed on July 24, 2026, that its wholly owned subsidiary, Panacea Biotec Pharma Limited (PBPL), has received a show cause notice from the Goods and Services Tax authority in Delhi. The notice, issued under Section 73 of the Delhi Goods & Services Tax / Central Goods & Services Tax Act & Rules, 2017, alleges an excess claim of Input Tax Credit (ITC) in the annual return filed for Financial Year 2022-23. The total liability demanded is Rs.4.06 crore, which includes tax, interest, and penalty. This development requires shareholder attention as it represents a potential contingent liability, although the company states it does not foresee adverse operational impact.
The disclosure was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with SEBI Master Circular No. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated January 30, 2026. The show cause notice was dated July 23, 2026, and was issued by the office of the Assistant Commissioner, GST, Delhi. The matter is currently at the show cause notice stage, with no penalty or restriction imposed yet.
Breakdown of Alleged Liability
The notice specifies a total financial demand of Rs.4.06 crore. This amount is structured across three components: principal tax, interest accrued, and a penalty for the alleged non-compliance. The details are outlined below:
| Component | Amount |
|---|---|
| Tax | Rs.2.27 crore |
| Interest | Rs.1.56 crore |
| Penalty | Rs.0.23 crore |
| Total Liability | Rs.4.06 crore |
Company Response and Next Steps
Panacea Biotec Pharma Limited is currently collating relevant details to prepare a draft reply against the notice. The company asserts that it does not foresee any adverse impact on its financial, operational, or other activities arising from this show cause notice. No further action has been taken by the listed entity beyond initiating the response preparation process.
What the Numbers Show
The composition of the Rs.4.06 crore liability reveals that interest constitutes a significant portion of the demand, accounting for approximately 38% of the total amount. The penalty component is relatively minor at Rs.0.23 crore, suggesting the primary focus of the authority is on recovering the principal tax and associated statutory interest rather than imposing punitive measures at this stage. The allegation pertains specifically to FY22-23, indicating a retrospective review of input tax credit claims rather than a current-period compliance issue.
