Zydus Wellness Faces GST Demand in IP Rights Acquisition

Zydus Wellness Ltd's wholly-owned subsidiary, Zydus Wellness Products Ltd, has been served a GST demand of Rs 56.33 crore by the tax authority. The demand relates to the acquisition of intellectual property rights from Heinz Italia S.P.A., covering the pre-acquisition period before January 2019. The company is assessing the situation.

Zydus Wellness Ltd announced on Saturday that its subsidiary, Zydus Wellness Products Ltd (ZWPL), has received a Rs 56.33 crore GST demand from the Directorate General of Goods and Services Tax Intelligence's Surat Zonal Unit. The demand includes interest and a potential penalty.

The tax demand pertains to the acquisition of intellectual property rights from Heinz Italia S.P.A. by Heinz India Pvt Ltd, which has now merged with ZWPL. The disputed tax period predates the merger completed in January 2019, as stated in a regulatory filing by the company.

ZWPL believes there is substantial merit in their case and is currently examining the intimation in detail to determine next steps. The company ensures there will be no immediate impact on operations, with potential liabilities indemnifiable by Heinz Italia S.P.A.

(With inputs from agencies.)