Astral Limited Receives GST Demand Order of Rs 82 Lakh Penalty Over Tax Classification and ITC Irregularities

Astral Limited GST Demand Order

Astral Limited has disclosed receipt of a GST demand order from the Assistant Commissioner of Central Tax, Sankrail Division, under the CGST and Central Excise Commissionerate, Howrah. The company informed the BSE and NSE through a regulatory filing dated November 4, 2026. The order was issued under Section 74 of the West Bengal GST Act, 2017, and was received by the company on November 3, 2026.

The tax authorities have flagged three issues. The first is short payment of GST arising from incorrect HSN classification. The second relates to irregular claiming and use of ineligible Input Tax Credit. The third concerns claiming ITC before goods were physically received at the company's registered business premises.

What The Order Involves

The total tax demand is Rs 1,91,873. Interest of Rs 1,18,487 has been levied on one of the issues, with additional applicable interest on the remaining issues. A penalty of Rs 82,00,747 has also been imposed. The penalty is substantially larger than the underlying tax demand, a pattern that has become common in GST enforcement matters where authorities invoke the demand-plus-penalty framework under Section 74.

Why It Matters For Businesses

The order touches on two compliance areas that regularly attract scrutiny. HSN classification determines the applicable GST rate, and an incorrect classification can lead to short payment allegations even where the taxpayer acted in good faith. The ITC issues go to documentation and timing. Claiming credit before physical receipt of goods is a recurring audit objection, and businesses with multi-location supply chains are particularly exposed to it.

The matter also illustrates the disclosure obligations of listed companies. Astral Limited has stated that it believes it has strong grounds to challenge the order and will file its reply and representations before the relevant authorities. The company has further said the order is not expected to have any material i…