Zomato, a leading player in the foodtech sector, has received a fresh penalty notice for Goods and Services Tax (GST) from Delhi’s sales tax officer, pertaining to fiscal 2018-19.
As per a regulatory filing to the stock exchanges, Zomato has been served with a demand order regarding the excess availment of input tax credit for the year 2018-19. This includes the imposition of applicable interest and penalty charges.
According to the filing, the company has been requested to settle an amount of INR 2,22,91,376 for GST, in addition to further charges for interest and penalties totaling INR 2,31,27,300.
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In reply to the show cause notice, the company furnished explanations on all matters, substantiated by pertinent facts and documents. Nonetheless, it seems that these were not comprehensively taken into account by the authorities while issuing the order.
In its filing to the exchange on Thursday (May 1), Zomato stated, “The Company is confident in its ability to present a robust defense before the relevant appellate authority and anticipates no financial repercussions on the Company.”
This development comes days after Zomato received a GST notice of INR 11.8 Cr from the Gurugram GST authority.
Earlier this month, Zomato faced consecutive tax notices, one amounting to INR 23 Cr and the other to INR 92 Cr, from the Karnataka tax authority.
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It’s worth noting that Zomato is presently encountering numerous tax-related hurdles. In March, the foodtech giant was served a GST penalty notice by Gujarat’s Deputy Commissioner of State Tax for the fiscal year 2018-19. Furthermore, in December of the previous year, Zomato received a show cause notice totaling INR 401.7 Cr from the Directorate General of GST Intelligence, Pune Zonal Unit.
Meanwhile, on April 20, Zomato obtained approval from the Indonesian government to dissolve its subsidiary in the Southeast Asian nation.
In terms of finances, the foodtech leader maintains robust profit and revenue expansion. Zomato saw its net profit soar more than fourfold sequentially to INR 138 Cr in the quarter ended December 2023. Similarly, its operating revenue surged over 15% quarter-on-quarter (QoQ) to INR 3,288 Cr in Q3 FY24.
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