Indian Railway Finance Corporation receives GST notice alleging excess Input Tax Credit of ₹305.38 crore for FY 2022-23; company says there is no immediate financial impact
New Delhi : Indian Railway Finance Corporation Limited (IRFC) has received a GST Show Cause Notice involving a total amount of ₹549.32 crore, including applicable interest and penalty, in connection with an alleged excess claim of Input Tax Credit (ITC) for the financial year 2022-23.
The company disclosed the development to the stock exchanges on August 24, 2026, under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
GST authorities allege excess ITC claim
According to IRFC’s disclosure, the Show Cause Notice was issued by the Assistant Commissioner of State Tax, Delhi Zonal Unit, under Section 73 of the Central Goods and Services Tax (CGST) Act, 2017.
The notice relates to the period from April 2022 to March 2023 and alleges that IRFC claimed excess Input Tax Credit amounting to ₹305.38 crore.
The alleged discrepancy is linked to non-reconciliation of information relating to the company’s GST records for the relevant financial year.
Total amount stands at ₹549.32 crore
While the alleged excess ITC amount is ₹305.38 crore, the total amount mentioned in the Show Cause Notice is significantly higher because it includes applicable interest and penalty.
| Particular | Details |
|---|---|
| Alleged excess ITC | ₹305.38 crore |
| Total amount including interest & penalty | ₹549.32 crore |
| Period involved | April 2022 – March 2023 |
| Notice issued | August 24, 2026 |
| Issuing authority | Assistant Commissioner of State Tax, Delhi Zonal Unit |
| Legal provision | Section 73, CGST Act, 2017 |
IRFC says there is no immediate financial impact
IRFC has clarified that the receipt of the Show Cause Notice does not result in any immediate financial impact on the company at this stage.
The company is currently examining the notice in consultation with its tax advisors. IRFC said it will submit a detailed response before the adjudicating authority within the prescribed time limit.
The company also stated that it will pursue all available legal remedies in connection with the matter.
No final order has been passed
Importantly, the notice is currently only a Show Cause Notice. It does not mean that the alleged tax liability has been finally determined.
IRFC clarified that, as of August 24, no adjudication order, penalty, restriction or sanction has been imposed on the company.
The matter will now proceed through the applicable tax-adjudication process, during which IRFC will have an opportunity to present its explanation and supporting documents.
What does the notice mean for IRFC?
A GST Show Cause Notice is essentially a communication from the tax authority asking the taxpayer to explain why a proposed tax demand, interest or penalty should not be imposed. The final liability, if any, is determined only after the adjudication process.
Therefore, the ₹549.32 crore figure should not be treated as a confirmed liability of IRFC at this stage.
IRFC disclosure to stock exchanges
The company has made the disclosure under the applicable SEBI listing regulations. The development is likely to remain under observation as IRFC evaluates the allegations and submits its response to the GST authorities.
Source: Official disclosure by Indian Railway Finance Corporation Limited dated August 24, 2026.
