Mahindra Group’s hotel chain subsidiary, Mahindra Holidays & Resorts India Ltd, on 28 June 2025, received a state tax notice along with a show cause demand from the State Tax Officer of Tamil Nadu, according to an exchange filing on Sunday, 29 June 2025. 

The State Tax Officer of Tamil Nadu has demanded a show cause state GST demand notice asking for over ₹363.07 crore ( ₹363,07,96,980) from the company under the provisions of the TNGST Act 2017 and CGST Act, 2017. The state tax demand notice is for the financial year 2018-19.

The filing also highlights that the tax authority has imposed more than ₹181.53 crore ( ₹181,53,98,490) in tax demand, along with ₹181.53 crore ( ₹181,53,98,490) in penalties for the same on account of the reporting of IGSST on club membership services instead of CGST and SGST.

The company also allegedly decreased the IGST payment since August 2023 after changing the registered office of the firm, according to the BSE filing. 

“The company has received a demand Show Cause Notice from the Authority for F.Y. 2018-19 demanding INR 363,07,96,980 (Tax – ₹181,53,98,490 and Penalty – ₹181,53,98,490) under applicable provisions of TNGST Act, 2017 & CGST Act, 2017 on account of reporting of IGST on club membership services instead of CGST and SGST and sudden decrease of IGST payment since August 2023 after the change in registered office of the company,” claimed the tax authority, according to the exchange filing.

Mahindra plans to pursue legal action

According to the filing data, the company plans to take appropriate steps to pursue legal action with regard to the state tax demand notice and said that they do not expect a “material financial impact” on the company.

“The Company is taking appropriate steps to pursue legal remedies before the appropriate authority in this regard,” said Mahindra Holidays in the BSE filing. 

Mahindra Holidays Share Price Trend

Club Mahindra or Mahindra Holidays & Resorts India shares closed 0.22% higher at ₹339.80 after Friday’s stock market session, compared to ₹339.05 at the previous market close. The company received the tax notice over the weekend when the Indian stock market was closed. 

Mahindra Holidays shares have given stock market investors more than 184% returns on their investment in the last five years. However, the stock is down 26.19% in the last one-year period. 

On a year-to-date (YTD) basis, the shares were down 8.28% in 2025, but are currently trading 2.15% higher as of the end of the last five stock market sessions. 

Shares of the Mahindra Group hotel chain subsidiary hit their 52-week high level at ₹494.95 on 25 July 2024, while the 52-week low level was at ₹241 on 7 April 2024, according to BSE data. The company’s market capitalisation (M-Cap) stood at ₹6,864.54 crore as of the stock market close on Friday, 27 June 2025. 

Read all stories by Anubhav Mukherjee

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