Transport infrastructure service firm RITES said on Monday it received an order from the Office of the Assistant Commissioner of State Tax (SGST) in Ahmedabad, Gujarat. The order, dated August 31, and officially received on September 2, details a tax demand totalling ₹38.3 crore.

RITES, formerly known as formerly known as Rail India Technical and Economic Service, is a Miniratna public sector enterprise established under Ministry of Railways Government of India in April 26, 1974.

In an exchange filing, the company said the breakdown of the demand includes ₹19.3 crore in tax, ₹17.1 crore in interest, and ₹1.93 crore in penalties, covering the period from April 2019 to March 2020.

The order addresses several alleged infractions, including excess input tax credit (ITC) claimed on B2B transactions, insufficient reversal of ITC as per Section 17(2) and Rule 42, and the excess claim of ineligible ITC under Section 17(5).

RITES has indicated that the order does not currently affect its financial, operational, or other activities. The company is preparing to respond to the notice within the prescribed timeframe.

The ultimate financial impact will be assessed based on the finalization of any appeal related to the tax demand, the company said in an exchange filing.

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