Chambal Fertilisers faces ₹527 crore GST penalty, plans legal challenge

Chambal Fertilisers and Chemicals Ltd said it has received an order from the Joint Commissioner of CGST & Central Excise, Patna-I, levying a penalty of about ₹527 crore under the Central GST/Bihar GST Act and IGST Act.

The penalty relates mainly to alleged GST liability on government subsidies for fertilisers and incorrect availing of input tax credit (ITC) for FY18-19 to FY22-23. The company said the subsidy is excluded from taxable supply under Section 15(2)(e) of the Central GST Act.

Chambal said the order does not impact its operations or finances beyond the penalty amount.

"The Company has a good case to contest the abovementioned Order on merits, and therefore, will challenge the same at appropriate appellate forum," Chambal Fertilisers stated.

The order was received on September 26, 2025.

Chambal Fertilisers and Chemicals Ltd is a leading Indian fertiliser manufacturer with a diversified product portfolio including urea, complex fertilisers, and other agricultural inputs. The company also receives government subsidies on certain fertiliser products and operates across domestic and international markets.

Headquartered in Kota, Rajasthan, Chambal Fertilisers has been part of India’s fertiliser industry since 1985.

Shares of Chambal Fertilisers ended 1.6% lower at ₹519.60 on Friday. The stock has fallen 16% in the last six months.

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