Max Estates Subsidiary Faces ₹21.13 Lakh Income Tax Demand from NFAC
Max Estates Limited's subsidiary, Max Square Limited, has received an income tax demand order of ₹21.13 lakh from the National Faceless Appeal Centre (NFAC). The demand is related to the assessment year 2021–22 and concerns the treatment of interest income from fixed deposits.
Income TaxReal EstateMax EstatesMax Square LimitedNfacReal Estate NewsJun 07, 2025
The dispute is centered around how interest income earned on fixed deposits was treated for tax purposes. Max Square Limited had parked certain unutilized funds from its project in fixed deposits for a short period. The company believed that the interest earned on these deposits should be treated as a capital receipt, meaning it was not regular income but linked to the overall cost of the project. However, the tax authorities held a different view.
The NFAC ruled that the interest earned on these deposits was taxable under the head “Income from Other Sources.” The authority added ₹63.77 lakh to the total taxable income of the company, which led to a tax demand of ₹21.13 lakh.
Max Estates clarified that this tax demand is not material in terms of the company’s overall financials. It also stated that the order does not affect the day-to-day operations of the company or its subsidiary. Max Square Limited is currently considering its legal options and may file an appeal before a higher tax authority to challenge the decision.
The company shared this development to maintain transparency and compliance with corporate disclosure norms.
About Max Estates’ Subsidiary – Max Square Limited
Max Square Limited is a wholly owned subsidiary of Max Estates Limited, which is part of the Max Group, a well-known Indian conglomerate with interests in real estate, healthcare, and senior living. Max Square Limited operates in the real estate development sector, focusing primarily on the development and management of commercial office spaces and mixed-use real estate projects. It plays a key role in Max Estates’ broader vision to deliver high-quality, sustainable, and modern workspaces that align with the evolving needs of businesses and professionals.
Frequently Asked Questions
What is the amount of the income tax demand order received by Max Square Limited?
The income tax demand order received by Max Square Limited is ₹21.13 lakh.
From which authority did Max Square Limited receive the income tax demand order?
Max Square Limited received the income tax demand order from the National Faceless Appeal Centre (NFAC), part of the Income Tax Department.
What is the assessment year for which the tax demand relates?
The tax demand relates to the assessment year 2021–22.
What is the main issue in the dispute between Max Square Limited and the tax authorities?
The main issue in the dispute is the treatment of interest income earned on fixed deposits. Max Square Limited argued that it should be treated as a capital receipt, while the tax authorities ruled it as taxable under ‘Income from Other Sources’.
What are the next steps Max Square Limited is considering in response to the tax demand?
Max Square Limited is currently considering its legal options and may file an appeal before a higher tax authority to challenge the decision.
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