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TeamLease Services’ FY2022-23 GST Show-Cause Notice: What the ₹52.76 Crore Proposal Means

TeamLease says a Karnataka GST show-cause notice for FY2022-23 proposes ₹52.76 crore in tax, interest and penalty. The amount is proposed, not a final adjudicated liability.
From TheFinanceBase Team3 min to read
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TeamLease Services Limited says it received a Karnataka GST show-cause notice proposing ₹52,76,08,537 in tax, interest and penalty for FY2022-23. It is a proposed amount in a show-cause proceeding, not a final adjudicated liability. In its October 13, 2026 exchange intimation, the company said it was evaluating the notice and planned to reply by October 29, 2026; that filing does not establish whether it later replied or what outcome followed.

What the notice is—and what it is not

TeamLease disclosed that it received the notice on September 29, 2026. It covers April 2022 through March 2023 and was issued under Section 73(1) of the Karnataka Goods and Services Tax Act, 2017 and the Central Goods and Services Tax Act, 2017. The issuing officer is identified as the Deputy Commissioner of Commercial Taxes (Large Taxpayers Unit)-03, Bengaluru. The company’s exchange intimation is dated October 13, 2026. (TeamLease filing reproduced by BazaarWatch)

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A show-cause notice sets out proposed tax, interest and penalty and gives the recipient an opportunity to respond. The ₹52.76 crore total is therefore the department’s quantified proposal as reported by TeamLease—not proof that the company owes that amount after adjudication. The available filing does not establish a later order, appeal or court ruling.

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How the proposed ₹52.76 crore is divided

Component Amount proposed Qualification
Tax ₹28,91,89,566 Amount reported by TeamLease in its October 13, 2026 disclosure.
Interest ₹20,95,00,014 Calculated through the notice date, September 29, 2026, and subject to change, according to the company.
Penalty ₹2,89,18,957 Amount reported by TeamLease in its October 13, 2026 disclosure.
Total ₹52,76,08,537 Aggregate proposed amount reported by TeamLease; not a final adjudicated liability.

The figures are those in the company’s filing; they are not independent estimates. Interest may change because the company said it was computed through the notice date and remains subject to change.

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What the two remaining issues concern

TeamLease said nine issues had been raised in an earlier Form GST DRC-01A intimation. According to the company, the proper officer dropped seven after considering its submissions. The September notice deals with the two issues that remained.

Turnover adjustments reported in GSTR-9C

The notice proposes tax at 18% on turnover adjustments of ₹42,47,67,225 reported under Table 5O of GSTR-9C. TeamLease says the stated basis is that no response was submitted for this item. The filing lists proposed tax of ₹7,64,58,100 for it.

Differences involving exempt, nil-rated or non-GST outward supplies

The notice alleges under-reporting of exempt, nil-rated or non-GST outward supplies. TeamLease describes a difference of ₹81,86,92,852 between the amount reported in GSTR-3B and the amount in Table 7(b) of GSTR-9C. The filing separately refers to exempt supplies of ₹18,15,74,312 for which the department said documentary evidence was absent, and says the notice proposes tax on the relevant amounts.

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TeamLease contests the calculation on the ₹18,15,74,312 item. It says tax was computed at 18% each under CGST and SGST rather than 9% each, overstating the demand by ₹3,26,83,376 in the company’s view. That is the company’s position in its disclosure, not an adjudicated finding. The filing does not establish how the authority will resolve the issue.

What TeamLease said about its response and the delayed disclosure

On October 13, the company said it was evaluating the notice and intended to submit its reply in Form GST DRC-06 on or before October 29, 2026. The cited intimation does not show that the reply was filed, so its stated intention should not be treated as confirmation of a submission or outcome.

TeamLease also disclosed that its intimation to the exchanges was 13 days late. It attributed the delay to an inadvertent communication gap between its indirect-tax and secretarial functions, saying the notice had not been escalated to the secretarial function within the prescribed timeline. The company said it had strengthened internal reporting. These are statements by TeamLease in its regulatory filing.

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How this differs from older GST disclosures

TeamLease’s FY2022-23 annual report recorded ₹232.36 lakh under GST matters as of March 31, 2023. The note described sums paid under protest against certain customer-disputed GST demands through that date and other GST notices for various years connected with mismatches or pending reconciliations. This historical disclosure predates the September 2026 notice and should not be added to, or treated as a component of, the ₹52.76 crore proposal. (TeamLease annual reports archive)

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What to watch for next

The key procedural distinction is between the proposed notice amount and any later adjudication or appeal outcome. The October 13 filing records only the company’s plan to respond by October 29; it does not confirm a reply or report a decision. Any later assessment of the exposure should rely on a subsequent company filing or authoritative order that states what happened to the proposed amounts.

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