Warranty Woes To ESOP Expenses: Crompton Greaves Tax Disputes Intensify

Crompton Greaves Consumer Electricals Limited has disclosed to BSE and NSE that it has received orders from the Commissioner of Income Tax (Appeals), National Faceless Appeals Centre, Delhi. These orders confirm earlier assessments, raising demands across different years. The company plans to appeal further, expecting a favorable outcome.  

Tax Orders And Assessment Years  
The company received three separate orders dated March 31, 2026, covering AY 2018-19, AY 2020-21, and AY 2023-24. Each order relates to disallowances of expenses such as warranty provisions, after-sales services, ESOP costs, depreciation on intangible assets, and education cess claims.  

Financial Impact  
The largest demand relates to AY 2023-24, with a potential impact of INR 299.2 million, including tax and interest. For AY 2020-21, the impact is INR 6.5 million, while AY 2018-19 carries a demand of INR 2.36 million. Despite these figures, the company has clarified that there is no material impact on its financials or operations.  

Company Response  
Crompton Greaves has stated that, based on prevailing law and expert advice, it will file appeals against these orders. The company remains confident of securing favorable outcomes from higher appellate authorities.  

Key Highlights  

• Orders received from Commissioner of Income Tax (Appeals), Delhi  
• Assessment years impacted: 2018-19, 2020-21, 2023-24  
• Largest demand: INR 299.2 million for AY 2023-24  
• Other demands: INR 6.5 million and INR 23.6 million  
• Company plans to appeal, expects favorable resolution  

Sources: Company filings with BSE and NSE, Crompton Greaves Consumer Electricals Limited disclosures