Online food delivery giant, Zomato, finds itself embroiled in a Goods and Services Tax (GST) penalty issue with the Deputy Commissioner of State Tax in Gujarat. The penalty stems from an audit of Zomato’s GST returns and accounts for the financial year 2018-19, highlighting an alleged excess availment of input tax credit and short payment of GST.
According to regulatory filings, Zomato disclosed receiving an order demanding a GST payment of Rs 4,11,68,604, coupled with applicable interest and penalties amounting to Rs 8,57,77,696 for the said financial year.
In response, Zomato clarified the issues raised in the notice, providing relevant documents and circulars. The company indicated that these aspects were not adequately considered by the authorities while issuing the order.
Zomato stated confidently in its exchange filing that it believes it has a robust case to present before the appellate authorities, foreseeing no financial impact from the issue.
In a separate development, Antfin Singapore Holding, an affiliate of Ant Financial Group, a major stakeholder in Zomato and part of the Alibaba conglomerate, has reduced its stake in the food delivery platform by two per cent. The stake sale, amounting to Rs 2,827 crore, occurred through open market transactions on March 6.
Bulk deal data on the Bombay Stock Exchange (BSE) reveals that Antfin Singapore Holding Pte sold over 17.6 crore shares, resulting in a 2.02 per cent decrease in their Zomato stake.
This development comes on the heels of a previous show cause notice served to Zomato in December 2023, amounting to Rs 402 crore, for unpaid GST related to delivery charges, along with interest and penalties for the period spanning 29 October 2019 to 31 March 2022.
