Renewable energy solutions provider Suzlon Energy Ltd announced on Thursday that it has been slapped with a penalty of ₹260.35 crore by the National Faceless Assessment Centre of the Income Tax Department for the assessment years 2016-17 and 2017-18.
The penalty is related to the disallowance of a claim of depreciation on goodwill, a disallowance under Section 14A, and a disallowance under Section 36(1)(va) for late payment of PF/ESI.
The company has contested the penalty orders, stating, “Based on judicial precedents, the company believes that the penalty proceedings should have been kept in abeyance until the conclusion of the quantum appeal against disallowances.”
Suzlon Energy emphasized that the quantum appeal against the subject disallowances is still pending before the tribunal on merits, making the penalty orders premature in their perspective.
In an official statement, Suzlon Energy expressed, “The company is in the process of challenging the subject penalty order before appellate/judicial forums and is confident of defending the penalty orders in view of the facts and merits of the case, duly supported by favorable judicial precedents.”
Detailing the penalties imposed, the company highlighted that for the disallowance under Section 14A, the penalty amounted to ₹35.11 crore, for the disallowance of depreciation on goodwill under Section 32(1), it was ₹132.48 crore, and addition on account of late payment of PF/ESI under Section 36(1)(va) amounted to ₹1.14 crore, bringing the total penalty to ₹87.59 crore for AY2016-17.
For AY2017-18, the penalty for the disallowance under Section 14A was ₹16.29 crore, the disallowance of depreciation on goodwill was ₹231.83 crore, and addition on account of late payment of PF/ESI under Section 36(1)(va) stood at ₹1.47 crore, resulting in a total penalty of ₹172.76 crore.
Suzlon Energy also mentioned, “The company is in the process of challenging the subject penalty order before appellate/judicial forums and is confident of defending the penalty orders in view of the facts and merits of the case, duly supported by favorable judicial precedents.”
At the close of the day, shares of Suzlon Energy Ltd concluded at ₹40.47, down by ₹1.92, or 4.98%, on the BSE.