Did Hyundai India Really Face a Rs 258.67 Crore GST Penalty Over Past SUV Sales?
Click to start listening
Synopsis
Hyundai India faces a hefty penalty of Rs 258.67 crore from tax authorities for underreporting GST compensation cess on past SUV sales. This article explores the implications of this ruling and Hyundai's response to the significant tax demand.
Key Takeaways
- Hyundai India faces a Rs 258.67 crore penalty for GST underpayment.
- The total tax demand exceeds Rs 517 crore, including penalties.
- Hyundai asserts no impact on its financial or operational activities.
- The company plans to appeal the decision.
- Recent CBIC amendments may support Hyundai's position.
New Delhi, July 22 (NationPress) Hyundai Motor India Limited (HMIL) has been issued a penalty of Rs 258.67 crore by the GST and Central Excise authorities for purportedly underreporting compensation cess on specific SUV models between September 2017 and March 2020, as confirmed by the car manufacturer on Tuesday.
The same amount of Rs 258.67 crore has been verified as the cess shortfall, leading to an overall tax demand exceeding Rs 517 crore, according to Hyundai India's stock exchange filing.
The company stated, "The order from the Commissioner (Appeals), CGST Dept, Tamil Nadu, confirms a GST compensation cess demand of Rs 258.67 crore alongside a penalty of Rs 258.67 crore due to alleged short payment of GST compensation cess on selected SUV models for the period from September 2017 to March 2020," as per HMIL.
The order was issued by the Office of the Commissioner (Appeals - II) of the CGST Department in Tamil Nadu on July 21.
“However, HMIL did not specify which SUV models were implicated in this case,” the company noted in its regulatory filing.
Despite this significant tax demand, Hyundai India assured that there would be no repercussions on its financial, operational, or other business activities resulting from this order.
Additionally, the company confirmed it is currently assessing the order and intends to appeal the decision.
"There is no impact on financial, operational, or other activities of the company due to this order. The company is reviewing the order and will exercise its right to file an appeal," it added.
A spokesperson from Hyundai stated that the company believes recent amendments and clarifications from the Central Board of Indirect Taxes and Customs (CBIC) bolster the company's stance.
“We are in the process of reviewing the order and will pursue a legal remedy through the appropriate channels,” the spokesperson elaborated.
Currently, HMIL offers various SUV models in India, including the Exter, Venue, Creta, Alcazar, Tucson, Creta Electric, and Ioniq 5.
The penalty ruling pertains to previous sales and is not anticipated to influence current or future vehicle offerings.
Point of View
It's essential to emphasize the importance of accountability in corporate dealings. The penalty against Hyundai India highlights the need for transparency in tax compliance, ensuring that companies uphold their responsibilities to the nation while navigating complex regulations.
NationPress
23/07/2025
Frequently Asked Questions
What is the reason for Hyundai India's penalty?
Hyundai India has been penalized for allegedly underreporting GST compensation cess on specific SUV models sold between September 2017 and March 2020.
What is the total tax demand against Hyundai India?
The total tax demand against Hyundai India exceeds Rs 517 crore, which includes the penalty and the cess shortfall.
Will this penalty affect Hyundai's business operations?
Hyundai India has stated that this penalty will not impact its financial, operational, or other business activities.
Is Hyundai planning to appeal the decision?
Yes, Hyundai is currently reviewing the order and plans to file an appeal against the decision.
Which SUV models are involved in this case?
The company has not disclosed which specific SUV models are implicated in the penalty.
