Tata Motors gets Rs 400cr notice from service tax dept

The service tax department has passed an order on Tata Motors for service tax evasion. According to CNBC-TV18's Aastha Maheshwari, the order has been passed, levying a tax demand of Rs 400 crore on the company. 

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According to the service tax department, some of the Tata Motors authorised service stations were not deducting service tax on the bills. In addition to this, the auto financing transaction that took place Tata Motors did not cut service tax on the fees that it received and thus the department has levied a tax demand of around Rs 400 crore for the period between 2004 and 2011.
The department has also issued a show cause notice on similar demands between 2011-2012 raising a demand of Rs 50-60 crore.
While Tata Motors did confirm that they were having these dialogues with the department, the investigations were going on.
They have challenged this order in Customs, Excise and Service Tax Appellate Tribunal (CESTAT). So, this order is currently being challenged. Tata Motors' overall profit after tax (PAT) for FY13 was around Rs 10,000 crore. So, although this Rs 400-500 crore demand might not be a big amount, but it is a sentimental negative for the company at this point of time.