Zomato announced on Friday that it has received a GST demand and penalty order worth Rs 11.81 crore for the July 2017 to March 2021 period. The food delivery firm shared the information via an official exchange filing on Friday.
The order stated that the firm received the GST demand worth Rs 5.9 crore and a penalty of another Rs 5.9 core. The official statement said, “Pursuant to Regulation 30 of the Listing Regulations, this is to inform that the Company has received an order for the period July 2017 to March 2021 passed by Additional Commissioner, Central Goods and Services Tax, Gurugram raising demand of GST of INR 5,90,94,889/- with applicable interest (not quantified) and penalty of INR 5,90,94,889/-.”
The company said that it received the demand order via a show cause notice for the export services provided by the firm to its subsidiaries based outside of India during the period July 2017 to March 2021.
Zomato said that it will be filing an appeal against the order before the appropriate authorities. In its response to the notice, the firm said it issued clarifications along with documents.
“The Company in its response to the show cause notice had clarified on the allegations along with supporting documents and judicial precedents, which appears not to have been appreciated by the authorities while passing the order,” the company said.
In terms of financial consequences, Zomato said it doesn’t expect any impact from the development. “The Company believes that it has a strong case to defend the matter before the relevant appellate authority and does not expect any financial impact on the Company,” the statement noted.
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Notably, Zomato recently launched its first-ever large fleet, meant to cater to large groups of people. The fleet has been designed to deliver orders for groups of up to 50 people, like parties and events.