Zomato, the food delivery giant, disclosed in a regulatory filing on April 19 that it has been issued a GST demand and penalty order amounting to A total amount of Rs 11.81 crore for July 2017 through March 2021.
The order comprises a GST demand totaling Rs 5.9 crore along with an equal amount imposed as a penalty. Issued by the Additional Commissioner of Central Goods and Services Tax, Gurugram, the order pertains to export services rendered by Zomato to its foreign subsidiaries from July 2017 to March 2021.
“In the filing, the company stated that the order was issued under Section 74(1) of the CentralCombined with Section 20 of the Integrated Goods and Services Tax Act, 2017 is the Goods and Services Tax Act of 2017, amounting to INR 5,90,94,889/-, inclusive of applicable interest (amount unspecified), and a penalty of INR 5,90,94,889/-.”
Despite Zomato’s efforts to elucidate the allegations with corroborating documents and legal precedents, the authorities proceeded with the order. The company has declared its intent to challenge the order before the appropriate appellate authority.
“The company stated that it has received the demand order, which confirms the GST demand on export services rendered to its subsidiaries located abroad from July 2017 to March 2021. The order upheld that these services fail to meet the conditions for qualifying as export of service under GST. Despite the company’s response to the show cause notice, which included clarification on the allegations supported by documents and legal precedents, the authorities did not seem to acknowledge these efforts while issuing the order.”
Zomato disclosed in an exchange filing last month that it had received a GST order from the Deputy Commissioner of State Tax, Gujarat, concerning the fiscal year 2018-19. The order requires a GST payment of Rs 4,11,68,604, in addition to further charges for interest and penalties, totaling Rs 8,57,77,696.
The company stated that the order resulted from an audit conducted on its GST returns and accounts.
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Zomato Limited, in its stock exchange filing, announced that it has received an order for the fiscal year 2018-19 as a result of the audit conducted by the Deputy Commissioner of State Tax, Gujarat. The order entails a GST demand of INR 4,11,68,604/-, along with corresponding interest and penalty charges, totaling INR 8,57,77,696/-.
