Deepinder Goyal-led Zomato gets GST tax demand notice of Rs 4.59 crore

Food delivery giant Zomato has received GST tax demand orders totalling over Rs 4.59 crore from tax authorities in Tamil Nadu and West Bengal. 

These demands include applicable interest and penalties. The company, in an exchange filing, said it is planning to challenge these orders in the appropriate appellate forums.

Details of the tax demand

The tax notices were issued by the Assistant Commissioner of GST and Central Excise in Tamil Nadu and the Assistant Commissioner of Revenue in West Bengal.

The Tamil Nadu authority's demand is for Rs 81,16,518 in GST, along with a penalty of Rs 8,21,290. The interest amount applicable has not yet been quantified.

The West Bengal authority's demand is significantly higher, at Rs 1,92,43,792 in GST, with an interest charge of Rs 1,58,12,070 and a penalty of Rs 19,24,379.

Zomato's response to the notices

Zomato said that it provided a response to the authorities, which included relevant documents and judicial precedents. However, the company claims that this information was not fully considered by the authorities before passing the orders.

Zomato has expressed confidence in its ability to defend against these tax demands and believes it has a strong case for appeal.

The tax demands were issued under Section 73 of the Central Goods and Services Tax Act, 2017, as well as the respective state-specific GST Acts for Tamil Nadu and West Bengal.

This section of the law pertains to cases where tax has not been paid or has been underpaid, either due to fraud or other reasons, and allows the authorities to issue demands for the outstanding amounts along with penalties and interest.

Despite the significant sums involved, Zomato has stated that it does not expect these tax demands to have a financial impact on the company. The company is preparing to appeal the orders and remains confident in its legal position. As the situation develops, Zomato will continue to pursue all available legal avenues to resolve the matter in its favor, it said.