DCM Shriram Hit With ₹1.59 Crore Income Tax Penalty, Company Challenges FY22 Assessment Order
DCM Shriram Ltd has been issued a penalty of Rs 1.59 crore by the Income Tax Department for the financial year 2021-22, related to the sale of buildings. The company plans to challenge the order.
DCM Shriram Ltd has been issued a penalty of Rs 1.59 crore by the Income Tax Department. |
Mumbai: DCM Shriram Ltd announced on Monday that the Income Tax Department's Assessment Unit has levied a penalty of Rs 1.59 crore against the company. The penalty, issued under Section 270A of the Income-tax Act, 1961, pertains to the financial year 2021-22 (Assessment Year 2022-23).
Penalty Details
The penalty is in connection with an addition made during assessment regarding the sale of buildings. The Income Tax Department treated these sales as capital assets, despite the company considering them depreciable assets.
Background of Assessment
An assessment order dated 31 October 2025, passed under Section 143(3) read with Section 144B of the Act, had initially made additions on account of these building sales. DCM Shriram had appealed this assessment order before the Income Tax Appellate Tribunal (ITAT) in Delhi.
Legal Challenge Ahead
The company's appeal against the original additions was heard by the ITAT on 26 May 2026, and an order is currently awaited. DCM Shriram stated that the Assessment Unit levied the penalty despite the matter being under adjudication at the ITAT.
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Company's Response
DCM Shriram plans to pursue appropriate legal action against the penalty order, saying it lacks merit and disregards the facts of the case. The company received the penalty order on 30 June 2026.
Financial Impact
The company expects no material financial, operational or other impact, beyond the amount of the penalty itself.
Disclaimer: This story is based on company exchange filings and is for informational purposes only. Investors should evaluate risks before making decisions.
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