L&T gains after Bombay HC quashes ₹2,237 crore GST demand against subsidiary; check details

Larsen & Toubro Ltd informed the stock exchanges on Tuesday that the HC accepted its writ petition and quashed a show cause notice for a GST tax demand of ₹2,237 crore against L&T Finance Ltd, an erstwhile subsidiary of the company. The notice was quashed on the basis of the tax paid by the company post the demerger.

On August 14, the company filed a writ petition before the Bombay High Court against the show cause notice issued by the Principal Commissioner of GST, Mumbai.

In 2018, the Director General of GST Investigation, Mumbai, issued a show cause notice against L&T Finance Ltd, alleging that the additional interest, penal interest and default interest charged by the company to its customers between 2013-14 and 2016-17 were liable to goods and services tax (GST). In 2020, the Principal Commissioner of CGST, Mumbai, confirmed the show cause notice against the company.

On August 14, Larsen & Toubro informed the stock exchanges that its wholly owned subsidiary Larsen & Toubro International FZE (LTIFZE) has entered into a Share Purchase Agreement (SPA) with Wave Development SPC (Wave) for acquiring an additional 15% stake (2,18,572 equity shares) in Larsen & Toubro (Oman) LLC (L&T Oman).

The acquisition is being conducted for a total consideration of OMR 1.2 million (Approximately ₹26.14 crore) or at a price of OMR 5.49 per share (Approx. ₹1196.25). Larsen & Toubro (Oman) LLC is a joint venture between LTIFZE and Wave.

The company said that the acquisition will be completed on or before August 31, 2024. After the completion of the acquisition, Larsen & Toubro International FZE will hold an 80% equity stake in L&T Oman.

L&T shares closed 0.59% higher at ₹3,593 apiece on the NSE.