Zomato, the popular food delivery company, has been served a Goods and Services Tax (GST) demand notice amounting to Rs 9.5 crore. The company disclosed this information in a filing to the exchange on Sunday.
The notice, issued on Saturday by the Assistant Commissioner of Commercial Taxes (Audit) Karnataka, demands a significant GST payment of INR 5,01,95,462, along with interest and penalties. Specifically, the demand includes GST of Rs 5.01 crore, interest of Rs 3.93 crore, and a penalty of Rs 50.19 lakh, totaling Rs 9.5 crore.
"The company has received an order for FY 2019-20 pursuant to the audit of GST returns and accounts by the Assistant Commissioner of Commercial Taxes (Audit), Karnataka, raising a demand of GST of Rs 5,01,95,462, along with interest of Rs 3,93,58,743 and a penalty of Rs 50,19,546," Zomato stated.
In response to the show cause notice, Zomato provided detailed explanations supported by relevant documents and judicial precedents. Despite this, the authorities were not satisfied with the company's response.
Zomato assured its stakeholders that the tax notice is not expected to have any significant financial impact on the company. "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," said Zomato.
On the stock market, Zomato shares closed at Rs 199.80 on Friday, prior to the announcement of the GST notice.
