Chemical maker Orica Ltd. reveals that it might face a $192 million hit to its after tax profit should it choose not to appeal a Federal Court decision because of which it will have to pay more tax over the sale of Orica's pharmaceuticals business in 1998.

In a statement, Orica posted that the Federal Court has only partly permitted its appeal against an amended tax assessment issued by the Australian Taxation Office in 2004 concerning the sale of its pharmaceutical business to Zeneca BV in 1998.

"The effect of the Federal Court judgment is that the ATO's claim has, for the most part, been upheld", Orica revealed in a statement to the Australian Securities Exchange.

A spokesperson for the explosives, chemicals and paint supplier on Wednesday revealed that in 2004, the Australian Taxation Office had asked that Orica hand over $226 million in extra tax, penalties and interest in relation to the sale of the pharmaceutical business to Zeneca.

The Orica spokesperson claimed that Orica had already paid $100 million to the ATO, hence the company would have to pay a further $126 million, or $92 million after tax.

Orica shares were 30 cents higher at $25.31 on Wednesday.