Nestle India Hit with Rs 69 Lakh Tax Fine
Click to start listening
Synopsis
Nestle India Limited has been penalized with Rs 69.45 lakh after the Appellate Authority upheld a prior ruling under the Customs Act. The company plans to appeal while ensuring no significant impact on its operations.
Key Takeaways
- Nestle India faces a tax penalty of Rs 69.45 lakh.
- Penalty confirmed by the Appellate Authority under the Customs Act, 1962.
- Company's appeal against the customs decision was rejected.
- SEBI issues a cautionary letter regarding insider trading.
- No material impact on financials or operations reported.
Mumbai, March 26 (NationPress) Nestle India Limited disclosed on Wednesday that it has incurred a tax fine of Rs 69.45 lakh following the Appellate Authority's endorsement of a previous ruling under the Customs Act, 1962.
The fine originated from a dispute over customs duties, as the firm had filed an appeal against the decision made by the Deputy Commissioner of Customs.
However, the appeal was turned down, upholding the requirement for customs duty, interest, and a matching penalty.
In a statement to the stock exchange, Nestle India noted that it had received the penalty order under Section 28 (4) in conjunction with Section 28AA of the Customs Act. Despite the company's challenge, the verdict favored the Revenue Department.
"There is no significant impact on our financials, operations, or other business activities due to the aforementioned order. The company intends to explore various avenues to contest this ruling," the statement read.
On Wednesday, shares of Nestle India concluded trading at Rs 2,240.10 each on the Bombay Stock Exchange (BSE).
Separately, the Securities and Exchange Board of India (SEBI) recently sent a cautionary communication to Nestle India concerning a purported breach of insider trading regulations by a senior executive.
The market regulator issued the warning to Nestle India's Compliance Officer (CCO) via its Deputy General Manager.
The company confirmed in a stock exchange announcement that it received SEBI's letter on March 6, 2025.
This violation was associated with a "contra trade" executed by a designated individual within the organization. In such scenarios, an insider buys or sells shares within six months of a prior transaction in the same security, aiming for quick profits.
SEBI regulations prohibit this conduct to avert the exploitation of unpublished price-sensitive information.
Notwithstanding the warning, Nestle India affirmed that this issue did not materially affect its financial or operational activities.
Additionally, Nestle India is considering a slight hike in its product prices to cope with the escalating costs of coffee, cocoa, and edible oil.
