Kallam Textiles faces ₹4.98 crore GST notice in 2026

What the company disclosed to the stock exchange

Kallam Textiles said it has received a GST show cause notice seeking a demand of ₹4.98 crore related to the financial year 2020-21. The notice was issued by the Additional Commissioner (S.T.), Vijayawada, Andhra Pradesh. The company disclosed the receipt of Form GST DRC-01 to the Bombay Stock Exchange (BSE) on August 28, 2026. It said the disclosure was made under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The show cause notice itself is dated August 27, 2026.

The company stated it does not agree with the contents of the notice. It also said it intends to take appropriate legal action in response. Beyond the stated demand, the company did not disclose any quantifiable financial impact in the filing.

Details of the GST demand and the legal provision cited

The notice relates to alleged non-payment of tax, interest, and penalty for FY2020-21. It was issued under Section 73(1) of the Andhra Pradesh Goods and Services Tax (APGST) Act, 2017. The filing described the issue as alleged contraventions linked to tax liabilities during FY21.

As per the company’s disclosure, the total demand includes the principal tax amount along with accrued interest and applicable penalties. The notice is a show cause notice, which typically requires a response from the taxpayer to explain why the demand should not be confirmed.

Key facts from the filing

The demand value is provided both as a rounded figure and as an exact amount in the table shared in the disclosure. For consistency, amounts are presented in ₹ crore (1 crore = ₹10,000,000). The exact demand of ₹4,97,70,714 equals ₹4.98 crore.

Company position: dispute and next steps

Kallam Textiles said it does not agree with the contents of the show cause notice. The company indicated it would take appropriate legal action to respond to the demand. The filing did not provide further detail on the basis for disputing the demand, or on the timeline for its response.

The company is also under the Corporate Insolvency Resolution Process (CIRP), as stated in the disclosure. Separately, the National Company Law Appellate Tribunal (NCLAT), Chennai Bench, has stayed the CIRP against Kallam Textiles Ltd, according to the information provided.

Market disclosure context: Regulation 30 and material events

The disclosure was made pursuant to Regulation 30 of the SEBI (LODR) Regulations, which covers material events and information. For listed companies, tax demands and regulatory actions are commonly disclosed when they are considered material for investors.

In this case, the company disclosed the receipt of Form GST DRC-01, which is the formal show cause notice used in GST demand and recovery processes. The filing also clarified that no financial impact beyond the demand amount was quantified at this stage.

Separate compliance issue: BSE fine for delayed results

Apart from the GST matter, the provided text also mentions a BSE fine imposed on Kallam Textiles for delay in submitting audited financial results for the quarter and year ended March 31, 2026. The company was fined ₹1,71,100, which includes a basic fine of ₹1,45,000 and GST of ₹26,100. The levy was linked to non-compliance with Regulation 33 of SEBI (LODR) Regulations.

How DRC-01 notices work, based on the information provided

The text explains that DRC-01 is the formal show cause notice under GST for demand and recovery. It is described as the stage where the tax officer asks the taxpayer to explain why a specified amount of tax, interest, and penalty should not be paid.

The text also outlines a general process for checking GST notices on the GST portal: log in at www.gst.gov.in and navigate to Services → User Services → View Notices and Orders. It says notices will appear there along with status and reply deadlines.

Separately, the text mentions a reply deadline of 30 days from the date of the notice for DRC-01, and also notes a 60-day time limit in a table for responding to DRC-01. The material further states that replies can be submitted online on the GST portal, and refers to using Form DRC-06 to reply to the show cause notice.

Other legal reference in the provided material

The supplied content also refers to a separate matter involving a show cause notice from the Andhra Pradesh High Court in a debt recovery case filed by Indian Bank. The amount mentioned is ₹141.93 crore. It also says the High Court granted an interim stay on further proceedings in the Debt Recovery Tribunal case until the next hearing, affecting the company and its directors named as respondents.

This High Court-related information is distinct from the GST notice disclosed to the exchange, but it adds to the broader picture of ongoing legal and compliance matters around the company as described in the provided text.

Why this matters for investors and stakeholders

A GST show cause notice can create near-term uncertainty because the demand includes tax, interest, and penalties, and because the final outcome depends on the company’s response and the tax department’s adjudication. In this case, Kallam Textiles has said it disputes the notice and plans legal action, while also stating that it has not quantified any impact beyond the stated demand.

The additional disclosure around a BSE fine for delayed financial results highlights compliance pressures on the company’s reporting timelines. Taken together with the mention of CIRP status and related legal proceedings, the disclosures indicate that investors and creditors may closely track subsequent filings for updates on replies, hearings, orders, or settlements.

Conclusion

Kallam Textiles has disclosed a GST DRC-01 show cause notice dated August 27, 2026, seeking a demand of ₹4.98 crore for alleged FY21 tax liabilities, and the company has said it disputes the notice and will take legal action. Separately, it has also faced a BSE fine of ₹0.0171 crore for delayed submission of audited financial results for FY26. Further clarity is expected only through subsequent regulatory updates, including any response filed to the GST notice and any future orders from the authorities involved.