IIFL nosedives 17% after receiving income-tax notice

Mumbai: Shares of IIFL Finance slumped as much as 17% on Thursday despite a 20% rise in profits after it informed exchanges that the company received a notice from the income- tax department on October 6, 2025, pertaining to the returns filed for the block period from April 1, 2018 to February 3, 2025.

This notice follows a search carried out by the IT department last January at the registered office and other locations of IIFL Finance and its subsidiary, IIFl Home Finance.

IIFL Finance deposited ₹1.47 crore toward a possible revision of its return or assessed income.


The company declared a 200% interim dividend as its net profit rose 20% to ₹501 crore and asset quality improved from 2.1% to 1.6% for the third quarter ending December 31, 2025. Consolidated AUM rose 9% to ₹98,336 crore.

IIFL Finance shares opened at ₹630 and slipped into successive lower circuits of 10% and 15% during intraday trade, before staging a late recovery in the final 15 minutes. The stock settled at ₹540.8, down 13% on a day when the benchmark Sensex advanced 0.49%.

IIFL had received IT department notices under Sections 143(2) and 142(1).

"The direction under Section 142(2A) is a procedural step... not a finding or allegation and not an adjudication. Such procedural audits are not uncommon for large, diversified financial institutions with high transaction volumes," Nirmal Jain, founder IIFL Group and MD, IIFL Finance.

The provision allows the tax authorities to appoint an independent auditor to assist with verification and reconciliation of data; and provides input for the assessment process.

"We are fully cooperating with the special auditor, and there is no impact on our operations, capital position, or growth plans," he said.