ATV Projects India’s record is clean on its face: six years of unqualified audit opinions and a steadily repaid related-party loan. Two things deserve attention: a single GST demand of Rs. 21.59 crore dwarfs the company’s annual profit and remains unresolved after two rounds of litigation, and the company avoids booking depreciation on a non-operational plant building while relying on carried-forward losses to report zero tax.
Key findings
- A single GST demand dwarfs annual profit and remains unresolved
Major- A revised GST demand of Rs. 21.59 crore on a 2017-18 leasehold sale was received on 20 December 2024, and the company filed an appeal on 13 March 2025. The original demand of Rs. 21.50 crore was quashed by the Bombay High Court on 7 October 2024, but the revised order remains outstanding as of the FY2024-25 audit report. Other contingent items are far smaller: a Provident Fund demand of Rs. 263.15 lacs pending before the Tribunal, and a Sales Tax Deferment of Rs. 182.10 lacs under assessment. - Depreciation and interest are avoided, and tax is near zero
Major- The company did not provide depreciation on the TPE plant building in FY2024-25 or FY2025-26 because the plant is not operational. No provision for interest was made on the Sales Tax Deferment Scheme, unsecured loan, or hire-purchase liabilities, as these matters are under litigation. Income-tax provision was nil for both years, relying on carried-forward losses and unabsorbed depreciation, and the average effective tax rate over FY2023-FY2026 was -0.9% against a statutory rate of 25.2%. - A related-party loan is being repaid while group transactions continue
Minor- Unsecured loans of Rs. 8,170.42 lacs were taken from related party Seftech Phosphate Private Limited for a one-time settlement. Repayment was Rs. 693.88 lacs in FY2025-26, bringing the closing balance to Rs. 3,294.16 lacs. In the same year, the company sold goods worth Rs. 215.84 lacs to Seftech India Private Limited and paid rent of Rs. 9.60 lacs to a director’s relative. - Promoter reclassification and a proposed warrant issue shift control
Minor- Thirteen entities were reclassified from promoter to public category, with BSE approval on 18 June 2024, reducing promoter holding to 26.95% with zero shares pledged. The Board on 19 July 2025 approved a preferential issue of 25,00,000 convertible warrants at Rs. 41.50 per warrant to promoter group entity Mahalaxmi Import Export Private Limited, which would raise diluted promoter holding from 26.95% to 30.23%. All director appointment resolutions across AGMs from FY2021 to FY2025 received assent exceeding 99% of votes cast. - Audit opinions are clean, but fixed-asset records remain incomplete
Minor- The auditor issued unqualified opinions on the standalone financial statements and on internal financial controls for both FY2024-25 and FY2025-26. The CARO report, a regulatory checklist on company affairs, flagged that fixed-asset records are “in the process of updating” in FY2021-22, FY2022-23, and FY2024-25. No fraud, whistleblower complaints, or wilful defaulter declarations were reported.
What to watch
- GST appeal outcome. The company’s appeal against the Rs. 21.59 crore GST demand was filed before the Deputy Commissioner (Appeal) on 13 March 2025.
- Provident Fund demand. The Rs. 263.15 lacs demand remains pending before the Tribunal as directed by the High Court of Allahabad, as of the FY2024-25 reporting period.
- Related-party loan repayment. The remaining Rs. 3,294.16 lacs unsecured loan balance to Seftech Phosphate Private Limited was disclosed in the FY2025-26 Annual Report.
- TPE plant operations. Commencement of operations would require depreciation on the building; the plant was non-operational as of the FY2025-26 reporting period.
Bottom line: This is a disclosed and audited record with a clean audit trail and a related-party loan that is steadily shrinking. The risk sits in two places: the Rs. 21.59 crore GST demand, which alone exceeds three years of typical profit and has already survived one court challenge, and the systematic avoidance of depreciation and interest charges that keeps reported earnings higher than they would otherwise be. Watch the GST appeal and the TPE plant’s status.