Zomato Faces Rs 9.5 Crore GST Demand Notice from Karnataka Tax Authority

New Delhi [India], June 30: Zomato, the food delivery company, has received a GST (Goods and Service Tax) demand notice of Rs 9.5 crore. The company informed the exchange in a filing on Sunday.

The notice, issued by the Assistant Commissioner of Commercial Taxes (Audit) in Karnataka, demands 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.

Zomato stated, “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 demand of GST of Rs 5,01,95,462, along with interest of Rs 3,93,58,743 and penalty of Rs 50,19,546.”

The company responded to the show cause notice with detailed explanations supported by relevant documents and judicial precedents. However, the authority was not satisfied with the response.

Zomato also informed the exchange that the tax notice does not 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.

The shares of the company closed at Rs 199.80 on Friday.