Shares of Quess Corp Limited slipped nearly 3% in Monday’s session, reacting to the company’s disclosure of a final income tax assessment order that has raised a demand of Rs 159.92 crore for Assessment Year 2022–23.
What triggered the fall?
The pressure on the stock comes after Quess Corp informed exchanges that it has received a final assessment and demand order from the Income Tax Department, adding a fresh overhang for investors.
According to the regulatory filing dated February 1, 2026, the order was:
- Issued on: January 24, 2026
- Received on: January 31, 2026 at 4:33 PM
- Issued by: Deputy Commissioner of Income Tax, Central Circle 2(1)
- Demand amount: Rs 159.92 crore
The order has been passed under Sections 143(3) read with 144C(13) and Section 156 of the Income Tax Act, 1961.
Key concerns flagged by the assessment
Quess Corp said its preliminary review indicates that the demand mainly arises from:
- Disallowance of deduction under Section 80JAA, and
- Disallowance of certain expenses claimed by the company.
These adjustments follow a similar pattern to earlier assessment years (FY17–FY21), where disputes are already pending before the Income Tax Appellate Tribunal.
Why the market reacted negatively
While the company has clarified that it plans to challenge the order, the stock reacted lower due to:
- The size of the tax demand (nearly Rs 160 crore),
- Potential cash flow and provisioning concerns in the near term, and
- Continued litigation overhang, given that similar disputes for previous years are still unresolved.
Markets typically factor in uncertainty when large tax demands are raised, even if companies intend to contest them.
Company’s stance
Quess Corp has stated that it will vigorously contest the assessment order, citing:
- Its interpretative position under the Income Tax Act,
- Judicial precedents in its favour, and
- Strong legal advice supporting its case.
The management believes its position is legally defensible and plans to pursue remedies through the appropriate appellate forums.
Bottom line
Quess Corp shares are under pressure today primarily due to the Rs 159.92 crore income tax demand, which has raised short-term uncertainty despite the company’s intent to appeal. Until there is clarity from appellate proceedings, the stock may continue to see knee-jerk reactions around litigation-related updates.
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