Cummins India has been ordered to pay a substantial tax demand and penalty by the Additional Commissioner of CGST, Pune-II Commissionerate. The order, received on 28 March 2026, levies a tax demand of ₹52,55,51,043 and a penalty of ₹52,55,76,043 under Section 74 of the Central Goods and Services Tax Act. This action pertains to the financial years 2019-20, 2020-21, and 2021-22.
The order alleges that Cummins India treated a leave and license agreement as a finance lease arrangement, which effectively amounted to the transfer of proprietary interest in the leased property. The company has announced its intention to appeal the order with the appropriate authority.
Despite the significant figures involved, Cummins India has stated that the penalty will not have a material impact on its financials or operational activities.
Disclaimer: This article is based on a regulatory filing submitted to the National Stock Exchange of India (NSE).