Zomato Faces Massive ₹9.45 Crore GST Demand Notice

As per the BSE exchange filing, on June 30, Karnataka’s Assistant Commissioner of Commercial Taxes issued a GST demand notice to Zomato for Rs. 9.45 crore, including interest and penalty. 

The company’s exchange filing mentions, “This is to inform that the company has received an order for FY 2019-20 pursuant to the audit of GST returns and accounts by the Assistant Commissioner of Commercial Taxes (Audit), Karnataka, raising demand of GST of Rs 5,01,95,462, along with interest of Rs 3,93,58,743 and penalty of Rs 50,19,546.” They further mentioned, “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.

However, Zomato has received GST demand notices before. Zomato received three demand notices from the authorities in Delhi and Karnataka on December 30 and 31, 2023. The first order pertained to the short payment of the GST in annual returns and non-reversal of input tax credit in case of exempted supplies. Further, the second order was regarding the additional interest on the claim that Zomato had incorrectly calculated the interest amount to be paid to the government on excess input tax credit reversed by the company. The last order was a large show-cause notice issued by the government of Karnataka, similar to that of December 28, 2023

Furthermore, the company has received multiple tax demands for the sales it has done through its multiple international subsidiaries. Zomato received a service tax demand and penalty order amounting to Rs. 184 crore for defaulting in the payment of the service tax from October 2014 to June 2017.  

About Zomato

Zomato is India’s unicorn startup founded by Deepinder Goyal and Pankaj Chaddah in 2008. The company specialises in food delivery services and provides its users with information, menus, and user reviews of restaurants. As of  2024, Zomato has generated a gross revenue of ₹12,114 crore and an operating income of ₹291 crore. It has spread its services to 1000+ Indian cities and towns.

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