Maharashtra GST Slaps ₹138 Crore Tax Demand On Bajaj Auto Over Auto Parts Classification Dispute

Two wheelers major Bajaj Auto was slapped with Rs 138 crore demand by Maharashtra GST for “differential tax liability”on auto parts classification.

The state GST department demand orders relates to differential tax liability between specific HSN classification adopted by Bajaj Auto with GST rate of 18% against general HSN classification with GST rate of 28% for auto parts manufactured by the company.

The tax department alleged the entire spare parts being customised product, used only in manufacturing of vehicles would get classified as auto parts at GST rate of 28% disregarding the principle of general rules of interpretation.

"The said Order is an appealable order and the Company has initiated appropriate legal action as per law," said Bajaj Auto in their regulatory filings and plans to challenge the order on merit against the tax demand.

Earlier in January, Bajaj Auto was imposed penalty and interest of over Rs 10 crore by the tax authority in a matter related to differential GST on classification of instruments cluster by CGST, Pune.