Zomato receives fresh GST notice, totaling Rs 2 crore in demand and penalties

The food technology giant announced its intention to lodge an appeal against the order with the relevant authority.

Shantanu Poswal
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Courtesy: X/@zomato

Zomato, the prominent online food delivery aggregator, found itself in the midst of a financial tussle as it received a fresh goods and services tax (GST) demand and penalty order exceeding Rs 2 crore. This comprehensive order encompassed a GST demand of Rs 2,22,91,376, accompanied by an interest component of Rs 2,08,98,164 and a penalty amounting to Rs 22,29,136, covering the period from July 2017 to March 2021.

The company promptly responded to this development by announcing its intent to challenge the order through an appeal before the relevant authority. In regulatory filings, Zomato articulated its stance, expressing confidence in the strength of its case based on merits.

Zomato stated, "We believe that we have a strong case on merits and the company will be filing an appeal against the order before the appropriate authority." This move signifies the company's commitment to resolving the matter through legal channels.

This recent GST demand and penalty order come on the heels of previous financial challenges for Zomato. Just last month, the company faced another GST demand and penalty order totaling Rs 11.81 crore, alongside additional demand notices for short payment of GST amounting to Rs 4.2 crore.

The cumulative financial impact on Zomato from these tax-related issues has been significant. Notably, earlier in the month, the public-listed food delivery aggregator encountered GST demands of Rs 5,90,94,889, along with applicable interest and penalties, following consecutive tax notices amounting to Rs 23 crore and Rs 92 crore. These notices primarily focused on export services provided by Zomato to its subsidiaries situated outside India, as indicated in the order issued by the Additional Commissioner, Central Goods and Services Tax, Gurugram.

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