Shipping Firm Wins Tax Relief in Dispute

State-owned Shipping Corporation of India Ltd(SCI) on Thursday (August 14) said it has secured a favourable ruling from the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai, in a long-standing dispute over

service tax on demurrage income.

The case stemmed from an earlier order dated October 3, 2016, which had ruled in SCI's favour for the period between July 2012 and September 2015. The Commissioner of Central Excise & Service Tax LTU, Mumbai, subsequently appealed against the order before CESTAT, involving a principal demand of ₹49.44 crore plus applicable interest.

In its latest decision, CESTAT dismissed the department’s appeal, paving the way for SCI to reduce approximately ₹146 crore from its contingent

liabilities. This amount comprises the principal demand of ₹49.44 crore and interest of ₹96.56 crore calculated as of June 30, 2025.

Also Read: Shipping Corporation of India shares surge 8% — Key factors behind the surge explained

The company had previously disclosed the amount as a contingent liability in its financial statements. Following the ruling, the contingent liability will be reduced accordingly.

First Quarter Results

Net profit surged 22.8% year-on-year (YoY) to ₹366.3 crore from ₹298.3 crore in

the first quarter of FY25. However, revenue slipped 13.1% to ₹1,316 crore against ₹1,514 crore in the year-ago period.

At the operating level, EBITDA dipped 3.8% to ₹489.6 crore in the April-June quarter over ₹509 crore year-on-year. SCI's EBITDA margin widened to 37.2% in the reporting quarter compared to 33.6% last year.

Also Read: BPCL signs MoU with SCI to develop dedicated maritime network for crude and petroleum

Shares of Shipping Corporation of India Ltd ended at ₹206.60, down by ₹1.85, or 0.89%, on the

BSE.