Mahindra and Mahindra (M&M) has dipped 5% to Rs 674 on reports that the Income Tax Appellate Tribunal has ordered Mahindra Intertrade, a M&M subsidiary, to pay Rs 3.6 crore penalty for concealing income and furnishing inaccurate details about earnings.

Mahindra Intertrade declared a loss of around Rs 6 crore in its return filed in October 2000. The department assessed the income at Rs 7 crore and, subsequently in 2009, issued a notice asking why a penalty should not be levied.

“The company has denied the charges and said it will appeal against the order in the high court," the report suggests.

A combined 1.6 million shares have changed hands on the counter so far on the NSE and BSE.