Tata Steel has secured significant relief from the Supreme Court in a long-running GST dispute after the apex court quashed a tax demand of ₹890.52 crore, along with an equal penalty and applicable interest. The combined tax demand and penalty stood at around ₹1,781 crore, excluding interest.
The dispute relates to input tax credit (ITC) claimed by Tata Steel between FY2018-19 and FY2020-21. GST authorities had alleged irregular claims and issued a show-cause notice in June 2025, followed by an order confirming the demand in December 2025. Tata Steel challenged the proceedings, maintaining that there was no excess ITC claim and raising questions over jurisdiction and limitation.After approaching the Jharkhand High Court, the steelmaker moved the Supreme Court. The apex court heard the appeal on August 19 and delivered its judgment on August 25, 2026, setting aside the existing tax demand and penalty.
However, the matter may not be fully closed. The Tax Department has been permitted to initiate fresh proceedings under Section 74 of the CGST Act, subject to the Supreme Court’s directions. Any fresh order must be passed by February 28, 2027.
