Regulatory / Taxation Issue
Sagility Receives Rectification Order; Income Tax Demand Revised Downward
NSE
sagility
BSE
544282
Sagility Limited informed exchanges that the Deputy Commissioner of Income Tax, Bengaluru, has issued a rectification order revising the company’s income tax demand for AY 2023-24 from ₹100 crore to ₹56.68 crore, including interest.
PRICE-SENSITIVE TRIGGER
Event: Rectification order issued by Income Tax Department
Type: Regulatory / Taxation Issue
Impact: Neutral
Immediate Effect: The revised tax demand has been reduced significantly from the earlier assessment, while the company has already filed an appeal against the adjustments.
Key Metrics:
- Original tax demand: ₹100,00,36,187
- Revised tax demand: ₹56,68,06,083
- Transfer pricing adjustment: ₹189,50,16,208
- Assessment Year: AY 2023-24
Highlight Metric:
- Income tax demand reduced by nearly ₹43.32 crore after rectification order.
What Happened ?
Sagility Limited disclosed that the Deputy Commissioner of Income Tax, Circle 6(1)(1), Bengaluru, issued a rectification order dated May 8, 2026 under Sections 154, 143(3), 144C(3), and 144B of the Income Tax Act for Assessment Year 2023-24.
Following the rectification, the company’s income tax demand was revised downward from ₹100 crore to ₹56.68 crore, including interest.
The company stated that the tax authority made transfer pricing adjustments to the returned income, and Sagility has already filed an appeal before the Commissioner of Income Tax (Appeals).
The company also clarified that the rectified assessment order does not have any material impact on its financials or operations.
Key Details
Tax Rectification Order Details
- Authority involved: Deputy Commissioner of Income Tax, Circle 6(1)(1), Bengaluru
- Rectification order date: May 8, 2026
- Date of receipt by company: May 18, 2026
- Applicable assessment year: AY 2023-24 (FY 2022-23)
- Revised tax demand includes interest component
Key Regulatory Developments:
- Transfer pricing adjustments were made to returned income.
- Sagility filed an appeal on May 12, 2026 against the assessment adjustments.
- The rectification order materially reduced the earlier tax demand amount.
Company Position:
- The company believes the revised demand is not maintainable.
- Management stated that tax advisors are handling the legal appeal process.
- Sagility expects no material operational or financial disruption from the matter.
Note:
- The rectification order reduced the previously communicated tax exposure substantially, which may ease investor concerns regarding the litigation size.
Risk Analysis
Key Risks:
- Tax authorities may continue proceedings during the appeal process.
- Final appellate ruling may differ from the company’s expectations.
- Additional interest or penalties may arise depending on legal outcomes.
- Ongoing transfer pricing disputes can create compliance uncertainty.
Worst Case Scenario:
- If appellate authorities uphold the adjustments fully, Sagility may need to pay the revised demand amount along with any further applicable interest or penalties.
Risk Level: Medium
Company Commentary
- Sagility stated that the revised tax demand stands at ₹56.68 crore including interest.
- The company confirmed that it has already filed an appeal before the Commissioner of Income Tax (Appeals).
- Management stated that the rectified assessment order has no material impact on the company’s financials, operations, or activities.
Official Exchange Filing: Sagility Limited