IIFL Finance Subsidiary Faces ₹963 Cr Tax Demand; Stay Granted

IIFL Finance Limited has disclosed that its material subsidiary, IIFL Home Finance Limited, has received an assessment order from the Assistant Commissioner of Income Tax raising a tax demand of ₹963.39 crore for the block period April 1, 2018, to February 3, 2025. The demand arises from block assessment proceedings following a search and seizure action. Key additions include overriding commission income (₹490 crore), deduction under section 36(1)(viii) (₹305 crore), interest strip assets (₹392 crore), and ESOP expenses (₹53 crore). IIFL Home Finance Limited believes it has strong grounds to contest these additions and does not expect a material impact on its financial position. Separately, IIFL Finance Limited has secured a stay on its previously disclosed tax demand of ₹475.56 crore until December 31, 2026, or disposal of its appeal, subject to a 5% payment (₹23.78 crore) in installments. The company has made its first installment payment of ₹5 crore.