Food delivery platform Zomato has been slammed with tax demand and penalty worth Rs 23.26 crore from Karnataka tax authorities.
However, Zomato believed it had a strong case on merits and it will raise an appeal against the order before the appropriate authority.
The demand order for the interest penalty and overuse of the input tax credit had been received.
“The company, in its response to the show cause notice, had clarified on the issue along with relevant documents and judicial precedents, which appears to not have been appreciated by the authorities while passing the order,” it said in an exchange filing.
The Gujarat State Tax Deputy Commissioner sent Zomato a tax notice earlier this month. The fine was related to the examination of the business’s 2018–19 financial year GST reports and accounting records. Due to overuse of input tax credits and underpayment of GST, Zomato was issued a demand order.
“The company has received an order for FY 2018-19 pursuant to the audit of GST returns and accounts by the Deputy Commissioner of State Tax, Gujarat raising demand of GST of Rs 4,11,68,604, along with applicable interest and penalty totaling to Rs 8,57,77,696,” Zomato said.
Zomato claimed that the authorities did not seem to have considered these when issuing the order.
