In a recent development, foodtech giant Zomato has received a Goods and Service Tax (GST) demand notice of Rs 9.5 crore from the Assistant Commissioner of Commercial Taxes (Audit), Bengaluru, Karnataka. The demand order pertains to the alleged excess availment of input tax credit, along with interest and penalties. Here’s a breakdown of the notice:
The Breakdown
- The Amounts Involved:
- GST Amount: Rs 5 crore
- Interest: Rs 3.93 crore
- Penalties: Rs 50.2 lakh
- Zomato’s Response:
- The company believes it has a strong case on merits and intends to file an appeal against the order before the appropriate authority.
- This is the second such notice from the GST department to Zomato. In April, the firm received a tax demand and penalty order exceeding Rs 184 crore.
- Background:
- In December, Zomato received a show cause notice from the GST Intelligence seeking Rs 401.70 crore in tax liability for the period between October 2019 and March 31, 2022. Zomato had argued that it is not liable to pay tax on delivery charges since those charges are collected on behalf of delivery partners.
The Way Forward
Zomato remains confident in its position and aims to defend its case vigorously. The company’s shares closed at Rs 199.80 on Friday, reflecting its resilience despite the ongoing tax dispute.
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