Mining major Hindustan Zinc is penalised for Rs 73.4 lakh by the Central Goods and Service Tax Commissioner, Udaipur, Rajasthan. In an exchange filing, the Vedanta Group company stated that it has received a confirmed penalty of Rs 73.46 lakh along with the tax demand and applicable interest.
Hindustan Zinc disclosed that the penalty demand by the Udaipur tax authorities pertains to the Central Value Added Tax (CENVAT) credit claimed by the company for the cement used as an input in its mines.
Hindustan Zinc claimed CENVAT credit during 2016-17. Now, the tax authorities have ordered the reversal of credit, as they do not deem the claimed CENVAT credit to be fit. The company must repay the claimed credit amount along with a penalty of Rs 73.4 lakh and applicable interest.
Hindustan Zinc’s response
Hindustan Zinc stated in the exchange filing that it intends to file an appeal before the Appellate Authority within the time limit prescribed under the excise law. Furthermore, the company stated that it is hopeful of a favourable outcome and does not expect the order to have any material financial impact.
Hindustan Zinc Q2 business
On Friday, Hindustan Zinc disclosed its Q2 business. The company reported a considerable production decline in silver and lead production in the second quarter of FY26.
Hindustan Zinc’s silver production declined 22 per cent YoY in Q2 FY26, reporting a total output of 144 tonnes. The company’s lead production also declined by 29 per cent YoY to 45 kilo tonnes.
Hindustan Zinc’s total zinc production in Q2 stood at 202 kilo tonnes, increasing by just 2 per cent YoY.