Zomato receives GST penalty worth Rs 23.26 crore

Listed food delivery platform Zomato has received a tax demand, interest and a penalty additionally amounting to Rs 23.26 crore from the Assistant Commissioner of Commercial Taxes (Audit), Karnataka, the company said on March 31.

The order is for the 2018-19 financial year, and pursuant to the audit of GST returns and accounts by the authority.

The online food delivery platform said it will appeal against the order before the appropriate authority “backed by a strong case of merits”.

The company said the order raises a demand of GST of Rs 11.27 crore, along with applicable interest and penalty totaling to Rs 23.26 crore.

Received on March 30, Zomato said the demand order has been received in respect of “excess availment of input tax credit and interest, penalty thereon.”

Zomato further said it has responded to the show cause notice with relevant documents and judicial precedents, but “were not appreciated by the authorities while passing the order.”

“The company believes that it has a strong case to defend the matter before the appellate authority and does not expect any financial impact on the company,” it added.

Zomato was recently in news for its Pure Veg Fleet, which was rolled back after a social media backlash alleging discrimination and safety concerns for delivery partners if uniforms and delivery boxes were visibly distinguished in red and green.