In a filing on Friday morning, Mahindra Group stated that its two-wheeler firm, Mahindra Two Wheelers Ltd, had received a tax notice of Rs 4,11,50,120 from the State Tax Deputy Commissioner in Indore, Madhya Pradesh.

The order was received on December 28, according to the business.

It was clarified that the punishment was given for two reasons:

1. Invoices on which MTWL has claimed Input Tax Credit (ITC) are not recorded by vendors in GST returns and consequently do not appear in auto-populated GSTR-2A.

2. No carryover of Education Cess credit balances from the pre-GST regime to the GST regime.

"Based on the company's assessment, an appeal will be filed and the company is hopeful of a favorable outcome at the appellate level and does not reasonably expect the said order to have any material financial impact on the company," according to the statement. 

Gusto and Rodeo UZO 125 scooters are manufactured by Mahindra Two Wheelers, as are Centuro NXT, Centuro Disc Brake, Centuro XT, Centuro Rockstar, and Centuro Rockstar Kick Alloy bikes. All of their items are made at their cutting-edge manufacturing facility in Pithampur, Madhya Pradesh.

Mahindra's Two Wheelers Division has bought a 51% share in Peugeot Motorcycles, a subsidiary of the Peugeot SA Group based in France. Peugeot Scooters is present in over 40 countries in Europe, Africa, Asia, and the Middle East.