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RDY Neutral Sentiment Score: 45/100

Dr. Reddy's Laboratories Ltd. 8-2-337, Road No. 3, Banjara Hills, Hyderabad - 500 034, Telangana, India. CIN : L85195TG1984PLC004507 Tel : +91 40 4900 2900 Fax : +91 40 4900 2999 Email : mail@drreddys.com www.drreddys.co

Key Takeaway: Dr. Reddy's Laboratories has received a tax demand order from the GST Authority in both Tamil Nadu and Odisha, citing the wrongful availing of input tax credit for the fiscal year 2018-19. The total penalties imposed amount to Rs. 5,20,076 and Rs. 2,75,331, respectively. The company assessed that these penalties will not have a material impact on its financials or operations. An appeal against the orders is planned, as the company aims to address these allegations.

Market Sentiment Analysis

POSITIVE FACTORS

  • The company plans to file an appeal regarding the tax demand.
  • The penalties levied are not expected to have a material impact on the company's operations.

CONCERNS & RISKS

  • The company received a tax demand order from the GST Authority, including interest and penalties.
  • Allegations of wrongly availing credit of input tax for the year 2018-19 may raise compliance concerns.

Full Press Release Details

National Stock Exchange of India Ltd. (Scrip Code:
BSE Limited (Scrip Code: 500124)
New York Stock Exchange Inc. (Stock Code: RDY)
NSE IFSC Ltd. (Stock Code: DRREDDY)
under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
This is to inform that the Company has received an
order from GST Authority towards tax demand including interest and penalty. The details as required under Regulation 30 of SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015 are as hereunder:
Requirement Response w.r.t GST Authority, Tamil Nadu Response w.r.t GST Authority, Odisha
Name of the authority State Tax Officer (ST), Ayyappanthangal Assessment Circle, Chennai - 123, Tamil Nadu Assistant Commissioner of State Tax, Bhubaneswar II Circle, Odisha
Nature and details of the action(s) taken, initiated or order(s) passed The Company has received order seeking demand including interest and penalty under section 73/74 of the TNGST Act/CGST Act, 2017. The Company has received order seeking demand including interest and penalty under section 73 of the OGST Act/CGST Act, 2017
Date of receipt of direction or order, including any ad-interim or interim orders, or any other communication from the authority Order dated April 29, 2024 was received by the authorized officials of the Company on April 30, 2024. Order dated April 30, 2024 was received by the Company on April 30, 2024.
Details of the violation(s)/ contravention(s) committed or alleged to be committed The authority has passed the order for the year 2018-19 on the contention that the Company has wrongly availed credit of input tax. The authority has passed the order for the year 2018-19 on the contention that the Company has wrongly availed credit of input tax.
Impact on financial, operation or other activities of the listed entity, quantifiable in monetary terms to the extent possible The above order levies a penalty of Rs. 5,20,076/-. Based on our evaluation, there is no material impact on the financials, operations, or other activities of the Company. The above order levies a penalty of Rs. 2,75,331/-. Based on our evaluation, there is no material impact on the financials, operations, or other activities of the Company.
The Company will file necessary appeal with the appellate
authority in this regard.
This is for your information and records.
For Dr. Reddy's Laboratories Limited
Company Secretary, Compliance Officer & Head-CSR

Frequently Asked Questions

What orders did Dr. Reddy's receive from GST Authorities?

Dr. Reddy's received tax demand orders from GST Authorities in Tamil Nadu and Odisha.

What is the penalty amount levied by the GST Authorities?

The penalty amounts are Rs. 5,20,076 for Tamil Nadu and Rs. 2,75,331 for Odisha.

What was the basis for the GST orders?

The orders claim the company wrongfully availed input tax credit for 2018-19.

Will Dr. Reddy's appeal the GST orders?

Yes, the company plans to file necessary appeals regarding the orders.

Is there any material impact on Dr. Reddy's operations?

The company assessed that there is no material impact on its operations or finances.

Last updated: Apr 30, 2024