Joint Commissioner of Commercial Taxes (Appeal-1) has upheld the demand for Goods and Service Tax at the rate of 18% on income received by United Spirits Limited for granting the right to use its trademarks, as to the 12% rate that was previously applied by the United Spirits.

The order includes a Tax of ₹31.5 Crores; a penalty of ₹3.2 Crores and applicable interest.

This matter pertains to the levy of GST at the rate of 18% instead of 12%, on income received by the Company towards the grant of the right to use its trademarks for the period July 2017 to August 2017.

United Spirits is likely to file an appeal against the order with the GST Appellate Tribunal once it becomes operational.

“Based on the company’s risk assessment, it has a good case and hence does not expect any material financial implications,” United Spirits said in an exchange filing.

Disclosure under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Source: Economic Times