Eicher Motors' VE Commercial Vehicles Receives GST Demand Order of ₹96.18 Crore

Eicher Motors Limited has issued an update regarding a regulatory development involving its material subsidiary, VE Commercial Vehicles Limited (VECV). The disclosure follows an earlier intimation made on July 10, 2025, related to a show-cause notice issued under GST laws.

Background of the GST Matter

On July 10, 2025, VE Commercial Vehicles Limited had disclosed receipt of a show cause notice from the office of the Commissioner, CGST & Central Excise, Ujjain Commissionerate, Madhya Pradesh. 

The notice alleged contraventions of provisions of the Central Goods and Services Tax Act, 2017, pertaining to the financial year 2017–18. The alleged GST liability under the notice amounted to ₹168.19 crore, along with an equivalent penalty.

The matter primarily related to delays in reporting certain credit notes during FY2017–18. Following receipt of the show cause notice, VE Commercial Vehicles submitted its detailed response and participated in the adjudication process.

Demand Order Issued by GST Authority

On December 29, 2025, VECV received a demand order from the Commissioner, CGST & Central Excise, Ujjain Commissionerate. Post adjudication, the authority confirmed a reduced demand of ₹96.18 crore, compared with the ₹168.19 crore originally proposed in the show cause notice. 

An equivalent amount of penalty has also been imposed, along with applicable interest under the CGST Act, the Madhya Pradesh GST Act, and the Integrated GST Act.

The demand order pertains to the same issue of delayed reporting of credit notes for FY2017–18.

Company’s Response and Next Steps

Based on internal assessment and legal advice, VE Commercial Vehicles Limited has stated that it believes the demand order lacks merit. The company intends to file an appeal before the appropriate appellate authority within the prescribed timelines. This indicates that the matter is expected to move into the litigation stage.

Impact on Eicher Motors

Eicher Motors clarified that the demand order does not have any impact on its financial position, operations, or other activities at this stage. The company has assessed the exposure and does not foresee any immediate adverse effect arising from the order.

Eicher Motors Share Price Performance

On December 31, 2025, Eicher Motors share price (NSE: EICHERMOT) opened at ₹7,189.00, down from its previous close of ₹7,192.50. At 12:00 PM, the share price of Eicher Motors was trading at ₹7,267.50, up by 1.02% on the NSE.

Also Read: Hyundai Motor India launches Prime Taxi Range!

Conclusion

While the GST demand order against VE Commercial Vehicles marks a regulatory development, Eicher Motors has indicated that the matter is being contested and is not expected to impact its financial or operational stability. Investors will now track the progress of the appeal and future updates on the case.

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