The company had posted a net profit of Rs 74.14 crore during the same period of the previous fiscal.
Net sales of the firm declined by 18.95 per cent to Rs 1,903.28 crore as compared to Rs 2,348.36 crore in the same period of the previous fiscal, Ashok Leyland Ltd said in a filing to the BSE.
The company had offered voluntary retirement scheme (VRS) for its executives during the quarter, it said.
"VRS compensation of Rs 43.58 crore represents the amount settled in respect of those executives who exercised their option and separated from employment up to December 31, 2013," the company added.