ideaForge Faces Massive Rs 109 Crore GST Shock! Company Set To Fight Demand

ideaForge Technology Ltd has received a GST order demanding Rs 54.586 crore in Tax liability and an equal penalty of Rs 54.586 crore, taking the aggregate amount involved to Rs 109.172 crore.

The order, received on October 1, 2026, was issued by the Additional Commissioner, CGST and Central Excise, Belapur. The company disclosed it to the stock exchanges on October 2 under the Securities and Exchange Board of India’s listing regulations.

The tax dispute relates to the period from January 2022 to March 2024. The department has alleged that ideaForge incorrectly paid GST at 5 per cent under Serial No. 244 of Schedule I and that the company should have paid the differential rate of 13 per cent.

ideaForge said it had made submissions in response to the show-cause-cum-demand notice. It also pointed to a government clarification issued in 2025 stating that drones attract GST at 5 per cent.

The company said it would challenge the order before the appropriate appellate authority after consulting tax advisers. ‘The Company expects a favourable outcome at the Appellate forum,’ it said in its disclosure.

The amount is sizeable in relation to ideaForge’s operating scale. Its consolidated revenue from operations stood at Rs 226.85 crore in FY2025-26. The disputed tax demand alone is equivalent to about 24 per cent of that revenue, while the combined demand and penalty represent about 48 per cent. However, these comparisons do not indicate the ultimate financial liability, which will depend on the appellate process.

The company said the order does not currently have an immediate material impact on its financials, business operations or other activities. It added that, based on prevailing law and its assesSMEnt of the case, it does not envisage an immediate material impact until the matter is finally concluded.

The development comes as the UAV maker is seeking to consolidate an operational recovery while executing its Order Book. In the June 2026 quarter, ideaForge reported net sales of Rs 68.59 crore, sharply higher than Rs 12.78 crore in the year-earlier quarter, while its net loss narrowed to Rs 2.59 crore from Rs 23.56 crore. Its profitability, however, remains sensitive to delivery mix, procurement schedules and customer acceptance, reflecting the lumpy nature of government and Defence-linked drone orders.

The company, which develops unmanned aerial vehicle platforms, payloads, communication systems and drone software, has been expanding its focus beyond hardware into services and software offerings. Management has previously indicated that execution of its opening order book and conversion of fresh defence procurement opportunities remain key near-term priorities.

As of 3:45 pm on October 1, 2026, ideaForge shares were trading at Rs 734.30, up 0.13 per cent from the previous close of Rs 733.35. The stock was about 23.8 per cent below its 52-week high of Rs 963.60, though it had gained 38.78 per cent over the preceding year, compared with a 3.22 per cent decline in the BSE 500.

For investors, the immediate issue will be whether the appellate process validates the company’s Reliance on the 5 per cent drone GST classification. Until then, the order adds a material regulatory overhang for a company whose FY2025-26 annual report had disclosed no contingent liabilities as of March 31, 2026.

Disclaimer: The article is for informational purposes only and not investment advice.