Note 35 - Report on other Legal and Regulatory requirements and commitments Litigations Involving Our Company
Our Company is involved in certain legal proceedings, which are pending at varying levels of adjudication at different forums. The outstanding matters set out below include details of criminal proceedings, tax proceedings, statutory and regulatory actions, and other material pending litigation involving our Company.
We cannot assure you that these legal proceedings will be decided in favour of our Company, or that no further liability will arise out of these proceedings. Further, such legal proceedings could divert management time and attention and consume financial resources. Any adverse outcome in any of these proceedings may adversely affect our profitability and reputation and may have an adverse effect on our results of operations and financial condition.
1. Against Our Company
a. Pending matters, which, if they result in an adverse outcome, would not materially and adversely affect the operations or the financial position of our Company:
M/s Hindustan Fluoro Carbon Limited (the "Petitioner") has filed a writ petition (19504/2009) before the Hon'ble High Court of Telangana at Hyderabad (the "Court") under Article 226 of Constitution of India in the year 2009 against State Bank of India, Chennai and Ors. (Collectively, the "Respondents") Our Company is one of the Respondents in the matter. Petitioner has filed the writ before the Court in the nature of Mandamus to declare the act of State Bank of India, one of the Respondents, rejecting Petitioner's letter of credit issued by SBI-Commercial Branch Chennai, as illegal and consequentially seeking an order directing State Bank of India to honour its commitment to realize the payment of ?132.06 Lakhs along with interest on the same to the Petitioner towards goods supplied by the Petitioner to our Company. Our Company has filed counter reply with the Hon'ble High Court in the year 2016 to dismiss the writ petition. Presently, the matter is pending before the Hon'ble High Court. Last hearing was on 29.09.2023. Next Date of Hearing not notified yet.
b. Litigation involving material violations of statutory regulations which are currently pending or have arisen in the preceding last ten years:
2. Filed By Our Company
a. Pending matters, which, if they result in an adverse outcome, would not materially and adversely affect
the operations or the financial position of our Company:
i. The Company (REFEX) has filed a suit (STC/PC/0003658/2022) before the Hon'ble V FTC MM Court, Saidapet, Chennai and the case is taken on file U/s 138 r/w 142 Negotiable Instruments Act against RM Enterprises (the "Respondent") for recovery of principal and interest amount to the tune of Rs.1,22,232/-(Rupees One Lakh Twenty-Two Thousand, Two Hundred and Thirty-Two Only) along with the cylinders that haven't been released by them. As of today, the principal amount has been paid, the interest amount is yet to be paid and the cylinders haven't been released by RM Enterprise. Non-Bailable warrants have been issued against the accused with regard to this matter. The next date of hearing is on 03.06.2025.
ii. The company has filed a suit before the CESTAT, Chennai against the Commissioner of Customs (II) Chennai in relation to the two containers with Bills of Entry, 4926248 & 4925897 which are held in the CFS and are to be re-exported. The containers are incurring huge demurrage charges, and the High Court vide order dated 27.11.2019 passed in W.P. 20939 of 2017 held that containers shall be released forthwith upon payment of duty. The order is yet to be complied with despite making the payment and since the goods are live and pending clearance, it is necessary in the interest of justice that the appeal is taken up for hearing on an early date. The matter has been admitted and the same is posted for arguments on 09.06.2025.
iii. The company has filed a writ petition (WP(C)/27/2022) with Delhi High Court for rectification of the name of Refex Hotels Private Limited (R2) and praying for issuance of appropriate directions to R2 to change its name. Counter affidavits on behalf of both the Respondents are taken on record. Any pleadings which are under objections be placed on record. Delay, if any, is condoned. Pleadings are complete. The matter is partly heard and is now posted to 13.08.2025 for filing written submission by all the Parties
iv. The company has filed a writ petition (WP/5074/2023, WP/5077/2023, WP/5096/2023) in the Madras High Court against The Commissioner of customs and 2 others directing the 1st and 2nd Respondent to ensure that the Demurrage Waiver Certificate dated 08.12.2020 issued by the 2nd Respondent is compiled by the 3rd Respondent and the subject containers nos. ZFLU2013012 and ZFLU2013080 are released to the Petitioner without requirement to pay any demurrage and storage charges including the charges from 03.09.2020 to the date of actual release of the goods. Currently, the matter is now reserved for orders.
v. The company has filed a suit (CRL MP No.6 of 2023) before the Hon'ble V FTC MM Court, Saidapet, Chennai against Best Engineering (Respondent). The Respondent had placed a purchase order for the products (Chlorodifluromethane (R-22), Difluromethane Pentafluromethane (R410A), and Difluromethane (R32) for which they had failed to make payments for the invoices raised. Therefore, the cheques issued were encashed and consequently were dishonoured. Due to non-receipt of payment, the case has been admitted and is yet to be heard. The Court on the condonation application is reserved for orders
b. Litigation involving issues of moral turpitude or criminal liability, which are currently pending or have
arisen in the preceding last ten years:
c. Litigation involving material violations of statutory regulations which are currently pending or have
arisen in the preceding last ten years:
i. Company has filed an appeal before the Hon'ble Commissioner of Income Tax Appeals at Chennai (the "appellate authority") as aggrieved by an order of Assessing officer, Chennai under Section 143(3) r.w.s 147 of Income Tax Act 1961 which was passed against our Company. This matter relates to issue of Long-Term capital gains on sale of land and excess depreciation claimed during the Financial Year 2013-14 which is having the tax demand to the tune of Rs.821.13 Lakhs for the assessment year 2014-15 which was raised by an assessing officer by way of issue of an assessment order dated March 31, 2022 under Section 143(3) r.w.s 147 of Income Tax Act, 1961. Further, the company has filed an application for rectification and by processing the rectification application, the demand is reduced to Rs. 751.16 Lakhs. However, the matter is pending before CIT(A) and is expected to come up for hearing in due course.
ii. Company has filed an appeal before the Hon'ble Commissioner of Income Tax (Appeals) at Chennai (the "appellate authority") as aggrieved by an order of Assessing officer, Chennai under Section 143(3) of Income Tax Act 1961 which was passed against our Company. This matter pertains to the Bogus purchases and cash credits during the Financial Year 2019-20 which resulted in a tax demand amounting to Rs. 4,086.66 lakhs for the assessment year 2020-21 which was raised by an assessing officer by way of issue of an assessment order dated September 30, 2022 under Section 143(3) of Income Tax Act, 1961. The matter is pending before CIT(A) and is expected to come up for hearing in due course.
iii. Company has filed an appeal before the Hon'ble Commissioner of Income Tax Appeals at Chennai (the "appellate authority") as aggrieved by an order of Assessing officer, Chennai under Section 143(3) of Income Tax Act 1961 which was passed against our Company. This matter pertains to the bogus purchases and cash credits during the Financial Year 2020-21 and disallowance u/s 14A which resulted in a tax demand amounting to Rs. 1,154.35 Lakhs for the assessment year 2021 -22 which was raised by an assessing officer by way of issue of an assessment order dated December 31, 2022 under Section 143(3) of Income Tax Act, 1961. Further, the company has filed an application for rectification and by processing the rectification application, the demand is reduced to Rs. 1136.78 lakhs. The matter is pending before CIT(A) and is expected to come up for hearing in due course.
iv. Company has filed a Writ petition to quash assessment order passed by the Deputy Commissioner of Income Tax on 31.05.2023 against the company for the assessment year 2016-17 and raised a demand of Rs. 3567.21 Lakhs. The department has been completed without adhering to the provisions of section 144A of the Income Tax Act. Therefore, considering the merits, the Hon'ble Madras High court has granted an interim stay on the demand.
v. Company has filed to file an appeal before the Hon'ble Commissioner of Income Tax Appeals at Chennai (the "appellate authority") as aggrieved by an order of Assessing officer, Chennai under Section 147 of Income Tax Act 1961 which was passed against our Company. This matter pertains to the bogus purchases and cash credits during the Financial Year 2018-19 which resulted in a tax demand amounting to Rs. 4,731.69 Lakhs for the assessment year 2019-20 which was raised by an assessing officer by way of issue of an assessment order dated March 31, 2024 under Section 147 of Income Tax Act, 1961. Further, the company has filed an application for rectification and by processing the rectification application, the demand is reduced to Rs. 4628.17 lakhs. The matter is pending before CIT(A) and is expected to come up for hearing in due course.
vi. Company has filed an appeal before the Joint Commissioner of Central Tax at Chennai (the "appellate authority") as aggrieved by an order of Joint Commissioner of Central Tax, Chennai under Section 74 of The CGST Act which was passed against our Company on March 31, 2023. This relates to alleging wrongful availment and utilisation of Input tax credit without the receipt of goods/services for the period July 2017 to March 2019 for which Show cause notice was issued with tax demand to the tune of Rs.356.46 Lakhs. An amount of Rs.332.37 Lakhs was paid voluntarily under protest before the issue of show cause notice. The demand order was passed for tax of Rs.24.09 Lakhs and penalty of Rs.24.09 Lakhs. However, the matter is pending before Joint Commissioner of Central Tax at Chennai and is expected to come up for hearing in due course
vii. Company has filed an appeal before State tax officer(C-829), Nodal-04, Mumbai (the "appellate authority") as aggrieved by an order of before State tax officer(C-829), Nodal-04, Mumbai under Section 73 of The CGST Act which was passed against our Company on 29th April 2024. This relates to alleging wrongful availment and utilisation of Input tax credit without the receipt of goods/services for the period July 2018 to March 2019 based on GST Audit conducted for which Show cause notice was issued with tax demand to the tune of Rs.144.34 Lakhs. The demand order was passed for a Tax amount of Rs.144.34 Lakhs ((Interest Rs. 179 Lakhs and Penalty of Rs.33.65 Lakhs).
viii. Company has filed an appeal before The Appellate Authority, Jaipur as aggrieved by an order of Deputy Commissioner of Commercial Taxes, Circle-B, Rajasthan under Section 74 of The CGST Act which was passed against our Company on 24th December 2024. This relates to alleging wrongful availment and utilisation of Input tax credit wherein the registration of supplier had been cancelled for the period July
2017 to March 2018 for which Show cause notice dated 15th April 2024 was issued with tax demand to the tune of Rs.164.28 Lakhs, the entire amount of Rs.164.28 Lakhs was paid voluntarily under protest. The demand order was passed for Tax of Rs.164.28 Lakhs (Interest of Rs.197.15 lakhs and Penalty of Rs.164.28 Lakhs). However, the matter is pending before the State Appellate authority, Rajasthan and is expected to come up for hearing in due course.
ix. Company has filed an appeal before The Appellate Authority, Jaipur as aggrieved by an order of Deputy Commissioner of Commercial Taxes, Circle-B, Rajasthan under Section 74 of The CGST Act which was passed against our Company on 27th December 2024. This relates to alleging wrongful availment and utilisation of Input tax credit wherein the registration of supplier had been cancelled for the period April
2018 to March 2019 for which Show cause notice dated 15th April 2024 was issued with tax demand to the tune of Rs.6.88 Lakhs, the entire amount of Rs.6.88 Lakhs was reversed voluntarily under protest. The demand order was passed for Tax of Rs.6.88 Lakhs (Interest of 7.01 lakhs and Penalty of Rs.6.88 Lakhs). However, the matter is pending before the State Appellate authority, Rajasthan and is expected to come up for hearing in due course.
x. Company has filed an appeal before The Appellate Authority, Jaipur as aggrieved by an order of Deputy Commissioner of Commercial Taxes, Circle-B, Rajasthan under Section 74 of The CGST Act which was passed against our Company on 27th December 2024. This relates to alleging wrongful availment and utilisation of Input tax credit wherein the registration of supplier had been cancelled for the period April
2019 to March 2020 for which Show cause notice dated 15th April 2024 was issued with tax demand to the tune of Rs.32.58 Lakhs, the entire amount of Rs. 32.58 Lakhs was reversed voluntarily under protest. The demand order was passed for Tax of Rs.32.58 Lakhs (Interest -Rs. 27.37 Lakhs and Penalty -Rs.32.58). However, the matter is pending before the State Appellate authority, Rajasthan and is expected to come up for hearing in due course
xi. Company has filed an appeal before The Appellate Authority, Jaipur as aggrieved by an order of Deputy Commissioner of Commercial Taxes, Circle-B, Rajasthan under Section 74 of The CGST Act which was passed against our Company on 27th December 2024. This relates to alleging wrongful availment and utilisation of Input tax credit wherein the registration of supplier had been cancelled for the period April
2020 to March 2021 for which Show cause notice dated 15th April 2024 was issued with tax demand to the tune of Rs.147.34 Lakhs (Interest of Rs.97.24 Lakhs and Penalty of Rs.147.34 Lakhs). The demand order was passed for Tax of Rs.147.34 Lakhs. However, a part of the demand relates to purchases on which ITC was not availed by us amounting to Rs.9.82 lakhs and an amount of Rs.135 Lakhs, supplier has remitted the GST for which we have filed rectification of order. However, the matter is pending before the State Appellate authority, Rajasthan and is expected to come up for hearing in due course
xii. Company has filed an appeal before The Appellate Authority, Jaipur as aggrieved by an order of Deputy Commissioner of Commercial Taxes, Circle-B, Rajasthan under Section 74 of The CGST Act which was passed against our Company on 27th December 2024. This relates to alleging wrongful availment and utilisation of Input tax credit wherein the registration of supplier had been cancelled for the period April
2021 to March 2022 for which Show cause notice dated 15th April 2024 was issued with tax demand to the tune of Rs.2.97 Lakhs. The demand order was passed for Tax of Rs.2.97 Lakhs (Interest of Rs.1.71 Lakhs and Penalty of Rs.2.96 Lakhs). However, a part of the demand relates to purchases on which ITC was not availed by us amounting to Rs.2.96 lakhs. However, the matter is pending before the State Appellate authority, Rajasthan and is expected to come up for hearing in due course
xiii. Company is in the process of filing an appeal before The Appellate Authority, being aggrieved by an order of Additional Commissioner, CGST and Central Excise, Bhopal under Section 74 of The CGST Act which was passed against our Company on 27th March 2025. This relates to alleged wrongful availment and utilisation of Input tax credit without actual receipt of goods or services for the period April 2018 to September 2020 for which Show cause notice dated 29th February 2024 was issued with tax demand to the tune of Rs.1465.96 Lakhs. However, an amount of Rs.586.93 Lakhs was paid and therefore demand was dropped to such extent. The demand order was passed for Tax of Rs.879.04 Lakhs (Penalty-Rs.1465.96 Lakhs). The appeal shall be filed before the appellate authorities in due course.
xiv. Company is in the process of filing an appeal before The Appellate Authority, being aggrieved by an order of Assistant Commissioner, Visakhapatnam central GST division, Visakhapatnam under Section 74 of The CGST Act which was passed against our Company on 28th March 2025. This relates to alleged wrongful availment and utilisation of Input tax credit without actual receipt of goods or services for the period April 2018 to September 2020 for which Show cause notice dated 13th March 2023 was issued with tax demand to the tune of Rs.71.16 Lakhs, which was paid under protest. The demand order was passed for interest of Rs. 71.16 Lakhs. However, the appeal shall be filed before the appellate authorities in due course.
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