Hero MotoCorp receives Income Tax Dept notice requesting payment of Rs 605 crore

Auto giant Hero MotoCorp has been issued a notice by the Income Tax Department to pay Rs 605 crore as tax and interest for six assessment years. The company disclosed that the tax demand amounted to Rs 308.65 crore while another Rs 296.22 crore was charged as interest. The notice is in relation to certain disallowances for the assessment years 2013-14 to 2017-18 and 2019-20.

Hero MotoCorp received assessment orders/demand notices dated March 30, 2024, from the Income Tax Department. The company stated in a stock exchange filing that it will be filing appeals against the orders with the appellate authorities, and also file rectification applications. The management believes that the demand raised is unsustainable and is unlikely to have a material impact on the company’s financials, operations, or other activities.

The tax demand and interest charges are a result of certain disallowances made by the Income Tax Department for the mentioned assessment years. Hero MotoCorp, as a leading two-wheeler maker, is prepared to address the issue through the legal process and is confident in the resolution of the matter. The company remains focused on its business operations and financial performance despite the tax notice.

The company’s response to the notice highlights its commitment to compliance with tax regulations and its proactive approach in dealing with legal challenges. Hero MotoCorp’s decision to file appeals and rectification applications demonstrates its willingness to address the issue professionally and transparently. The management’s assurance that the tax demand will not significantly impact the company’s overall performance reflects its confidence in overcoming the situation effectively.