Zomato Receives ₹9.5 Crore GST Notice in Karnataka, Plans to Appeal

Online food delivery giant Zomato has been hit with a GST (Goods and Services Tax) demand notice amounting to ₹9.5 crore. The company disclosed this information in a filing on Sunday, stating that the demand pertains to the fiscal year 2019-20 following an audit of their GST returns and accounts.

The notice, which was issued on Saturday, includes a GST amount of ₹5.01 crore, interest of ₹3.93 crore, and a penalty of ₹50.19 lakh. This demand was made by the Assistant Commissioner of Commercial Taxes (Audit) in Karnataka.

In a statement, Zomato said, “The Company has received an order for FY 2019-20 following the audit of GST returns and accounts by the Assistant Commissioner of Commercial Taxes (Audit), Karnataka, raising a demand of ₹5,01,95,462, along with interest of ₹3,93,58,743 and a penalty of ₹50,19,546.”

Despite responding to the show cause notice with detailed explanations and relevant documents, the authorities were not convinced, Zomato added.

However, Zomato believes that this notice will not have a significant financial impact on the company. They are confident that they have a strong case and plan to defend themselves before the appellate authority. On Friday, Zomato’s shares closed at ₹199.80.

In other news, Zomato announced on Thursday that it is expanding its ‘restaurant services hub’ across the country. This hub aims to be a one-stop solution for restaurants, helping them with staffing, licensing, and other essential services.

Zomato’s goal is to simplify the complexities of running a restaurant by assisting with finding the ideal location, securing suppliers, obtaining necessary licenses, and hiring the right staff.

Meanwhile, Zomato’s competitor Swiggy has also introduced a new feature on its partner app to connect restaurants with staffing experts, helping them hire qualified candidates for various roles.