Tata Capital Faces ₹413 Cr Tax Demand

Tata Capital Limited announced on March 21, 2026, that it has received an Income Tax reassessment order for the financial year 2017-18. The order, issued on March 20, 2026, pertains to its subsidiary, Tata Capital Financial Services Ltd (TCFSL), which merged with the parent company in April 2023. The total demand raised stands at ₹413.18 crore, encompassing ₹202.72 crore in interest charges.

The company disputes the interest calculation, stating the assessing officer applied an incorrect computation instead of allowing credit for ₹225.89 crore in taxes paid by TCFSL. This led to a short credit of ₹209.52 crore, contributing to the substantial interest levied. In contrast, the original assessment in September 2021 had allowed a tax credit of ₹224 crore.

Additionally, certain disallowances for FY 2017-18, amounting to ₹26.31 crore, are also being contested. Tata Capital has already filed or is in the process of filing appeals with the Commissioner of Income Tax (Appeals) for these disallowances. The company expressed confidence in achieving favorable outcomes for both the interest and disallowance disputes, believing there will be no adverse impact on its financials or operations.