Zomato Hit with Rs 803.4 Crore GST Tax Demand: What You Need to Know

Admin — Sat, 14 Dec 2024 20:59:40 +0000

Food delivery giant Zomato is facing a significant tax demand of Rs 803.4 crore from the GST authorities in Thane, Maharashtra. This amount includes unpaid Goods and Services Tax (GST), along with interest and penalties. Here’s a simplified breakdown of the situation:

What is the Tax Demand About?

The GST department claims that Zomato did not pay GST on delivery charges for a period spanning from October 29, 2019, to March 31, 2022. The case was reviewed and decided by the Joint Commissioner of CGST and Central Excise from the Thane Commissionerate in Maharashtra.

How is the Rs 803.4 Crore Calculated?

GST Dues: Rs 401.7 crore
Penalty: Rs 401.7 crore (equal to the unpaid GST amount)
Total: Rs 803.4 crore (including interest and penalties)

Zomato’s Response

Zomato has stated that it strongly disagrees with the GST department’s decision. The company believes it has a solid legal case and is prepared to challenge the order.

"We believe that we have a strong case on merits, which is backed by opinions from our external legal and tax advisors," Zomato mentioned in its regulatory filing. The company also confirmed its plan to appeal the order before the appropriate authority.

What Happens Next?

Zomato plans to take legal action to contest the tax demand. With the support of expert legal and tax advisors, the company aims to resolve the matter through the proper judicial channels.

Stay tuned for updates as Zomato navigates this legal challenge.

Zomato and Swiggy Address CCI Investigation, Affirm Compliance with Competition Laws

Admin — Tue, 12 Nov 2024 19:07:49 +0000

In light of an ongoing Competition Commission of India (CCI) investigation into potential anti-competitive practices, Zomato and Swiggy have reiterated their commitment to adhering to competition regulations and clarified that the CCI has not made any final decisions.

Both companies labeled recent reports on the CCI’s probe as “misleading,” stating that these reports incorrectly suggest that final determinations on alleged unfair practices, such as preferential treatment for certain restaurant partners, have been made. Zomato, in a regulatory statement, clarified that the CCI issued a preliminary order on April 4, 2022, mandating the Director General's office to examine possible violations of the Competition Act.

In response, Zomato stated, “Since the intimation of April 5, 2022, the CCI, on merits, has not passed any order. The aforementioned news article is misleading.” The company further asserted, “We will continue to work with the CCI to explain why our practices comply with the Competition Act and they don’t have any adverse effect.”

Swiggy also addressed the media reports, expressing that some coverage confuses the investigative process with a final conclusion. "Based on order of the CCI dated April 5, 2022, the Director General probed certain aspects of the conduct of our business, and its inquiry and report of March 2024 is a preliminary step in an ongoing probe by the CCI, and not a final decision as some reports suggest,” Swiggy stated.

As Zomato and Swiggy continue to operate within the competitive landscape of India's hospitality and food retail sectors, both companies assert their commitment to regulatory compliance amid the ongoing CCI review.

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Zomato Hit with Rs 803.4 Crore GST Tax Demand: What You Need to Know

Zomato and Swiggy Address CCI Investigation, Affirm Compliance with Competition Laws