HFCL 20% Dividend Tax Procedures Under IT Act 2025

Date: July 16, 2026

The Board of Directors, at its meeting held on April 30, 2026, recommended a dividend of 20%, i.e., Re. 0.20 per equity share of face value ₹1, for the financial year 2025-26.
The dividend is subject to declaration by shareholders at the ensuing 39th Annual General Meeting (AGM).
The dividend will be paid within 30 days of its declaration at the AGM.

Pursuant to the Income Tax Act, 2025 (effective April 1, 2026), dividend is taxable in the hands of shareholders, and the Company is required to deduct TDS.
The document provides a comprehensive guide to TDS rates and required documentation for both resident and non-resident shareholders to claim exemptions or beneficial rates.
A critical deadline of August 16, 2026, is set for shareholders to submit all necessary documents (PAN, Form 121, tax certificates, TRCs, etc.) to the Company or its RTA, MCS Share Transfer Agent Limited, to determine the applicable TDS rate.
Documents can be submitted via email to tdsexm@hfcl.com or admin@mcsregistrars.com or physically to the RTA's address in New Delhi.
The Company reserves the right to call for further information and apply domestic law/DTAA provisions for TDS at its sole discretion.

In compliance with SEBI mandates, dividend payments to shareholders holding shares in physical mode will be made only through electronic means.
Physical shareholders must furnish their PAN, Choice of Nomination (optional), Contact Details (Postal Address with PIN and Mobile Number), Bank Account Details, and Specimen Signature to the Company/RTA to receive the dividend.

Nil TDS: If aggregate dividend during the tax year (FY 2026-27) does not exceed ₹10,000.
10% TDS: For residents with a valid PAN updated in the Company's records.
20% TDS: For residents with No PAN/Invalid PAN/PAN not updated/PAN not linked with Aadhaar.
Nil TDS: Upon submission of a duly filled and signed Form 121 for exemption.
Certificate Rate: If a lower/nil tax deduction certificate issued u/s 395 of the IT Act, 2025 is submitted.
Specific nil rates apply to entities like Securitisation Trusts, Category I & II AIFs, Provident Funds, NPS Trust, and others exempt u/s 11, upon submission of requisite documents.

FPIs/Other Non-Residents: 20% (plus surcharge & cess), or beneficial tax treaty rate if supported by documentation including a valid TRC, PAN, Form 41, and self-declarations regarding PE, POEM, PPT, GAAR, and beneficial ownership.
Non-Residents with PE in India: 35% (plus surcharge & cess).
Category III AIF in IFSC: 10% (plus surcharge & cess).
Residents of Notified Jurisdictional Area: 30% or rate in force.
Nil TDS: For Sovereign Wealth Funds, Pension Funds, and ADIA subsidiaries notified u/s Schedule V(7), upon submission of required documentation and self-declarations.

Shareholders with multiple accounts under a single PAN will be taxed at the highest rate applicable to any of their status categories.
All shareholders are urged to update their bank account details, residential status, registered email, mobile number, and category in their demat accounts.
The communication includes links to download all necessary forms (Form 121, Form 41, various self-declaration forms) from the company's website (www.hfcl.com).
The information is based on the Income Tax Act, 2025 and Rules for the tax year (FY) 2026–27.

The document includes a disclaimer stating that the information provided is for general purposes and does not constitute legal or tax advice, recommending shareholders consult their own tax consultants.