DLF profit down 44.5%, gets tax notice

India’s largest real estate developer by market capitalisation, DLF Ltd, saw its net profit plunge by 44.5 per cent for the third quarter ended December 2011 on a year-on-year basis.

It had recorded a net profit of Rs 258.7 crore in the October to December quarter as against Rs 465.61 crore in the corresponding period last year. The company blamed high interest rates, commodity and labour cost inflation for the steep fall in the net profit, and cautioned that it may take a few more quarters for the company to regain full momentum.

The Income Tax department has slapped additional tax notices of Rs 1,137 crore on the company and its subsidiaries for the 2009-10 assessment year, DLF said. The company has challenged these orders before the appellate authorities. "The company and its certain subsidiaries received assessment orders for assessment year 2009-10 and for some reopened cases of earlier assessment years from the income tax authorities, creating an additional demand of Rs 1,137 crore," the company said in a statement.

“While the macro environment continues to remain unfavourable…company’s strategy shall require patience and caution to execute and company shall take longer than anticipated time for its initiatives to take fruition”, said the company’s statement.

Its sales were 17.9 per cent down to Rs 2,034.4 crore in the third quarter of 2011, versus Rs 2479 crore last year.