Business

DCM Limited to appeal against Income Tax order on alleged fake purchases

The Income Tax Department has passed an assessment order on March 30, revealing that DCM Limited’s demerged Textile Business Undertaking made bogus purchases of Rs 25.89 crore in FY 2018-19 from a supplier who failed to respond to notices.

According to DCM Limited, the assessment order highlights the lack of information from the supplier and absence of corroborative evidence, leading to a zero demand determined to be payable by the company under the notice of demand u/s 156 of the Income Tax Act.

The company is currently examining the order and plans to take necessary steps such as filing appeals, rectification applications, and seeking indemnity for the claim. It also clarified that all liabilities and dues of the demerged undertaking have been transferred to DCM Nouvelle Limited as per the NCLT order dated May 1, 2019.

DCM Limited intends to file an appeal against the assessment order within the prescribed time limits under the Income Tax Act, including contesting penalty proceedings. The company will initiate the proceedings either on receiving notice or as advised by DCM Nouvelle Ltd, at their cost and consequences.

IANS

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