Zomato, the popular online food delivery platform, has been hit with Goods and Services Tax (GST) demand orders totaling over ₹4.59 crore from tax authorities in Tamil Nadu and West Bengal. The demand includes relevant interest and penalties, adding to the financial burden on the company.
Details of the GST Tax Demand
- Tamil Nadu: The Assistant Commissioner of GST and Central Excise, Nungambakkam Division, Tamil Nadu, issued an adjudication order under Section 73 of the Central Goods and Services Tax Act, 2017. The order demands ₹81,16,518 in GST, along with a penalty of ₹8,21,290. The interest amount was not specified in the order.
- West Bengal: The Assistant Commissioner of Revenue, Government of West Bengal, issued a separate adjudication order. This order demands ₹1,92,43,792 in GST, with an additional interest of ₹1,58,12,070 and a penalty of ₹19,24,379.
Zomato’s Response
In a regulatory filing, Zomato stated that it plans to appeal against these tax demands. The company has provided a response with relevant documents and judicial precedents to the authorities, which it believes were not fully considered during the adjudication process.
Zomato expressed confidence in its ability to defend the case before the appellate authorities, indicating that it does not expect any significant financial impact from the tax demands.
Zomato Share Performance
On the day the tax demand was made public, Zomato’s share price opened at ₹254.15 on the Bombay Stock Exchange (BSE). The stock experienced fluctuations throughout the day, reaching a high of ₹256.30 and a low of ₹248.55, before closing at ₹252.20, a slight increase of 0.30% from the previous close of ₹252.95.
Conclusion
Zomato is facing a significant GST tax demand from authorities in Tamil Nadu and West Bengal. However, the company is preparing to appeal these orders, believing it has a strong case. Investors have shown resilience, with Zomato’s stock showing minor gains despite the tax-related news.
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