Hyderabad, February 2, 2025 – Dr. Reddy’s Laboratories Ltd. (NSE: DRREDDY, BSE: 500124, NYSE: RDY) has disclosed that it has received a penalty order from the Additional Commissioner of Central Tax, Ranga Reddy GST Commissionerate, Hyderabad, levying a penalty of ₹184.35 crore under provisions of the CGST Act, 2017.
Regulatory Action & Alleged Violation
The order, dated January 28, 2025, was received by the company on February 1, 2025. According to the GST authority, the penalty has been imposed on the contention that Dr. Reddy’s received excess refund and failed to pay GST on a settlement amount.Financial & Operational Impact
Despite the substantial penalty, Dr. Reddy’s has stated that there is no material impact on its financials, operations, or other activities following an internal evaluation.Company’s Response & Next Steps
The pharmaceutical giant has announced its intention to evaluate filing an appeal against the penalty order with the appellate authority.This latest regulatory development adds to the ongoing compliance challenges faced by large Indian pharmaceutical firms as tax authorities scrutinize financial transactions more closely.