Zomato, one of India’s leading online food delivery platforms, is facing a significant GST (Goods and Services Tax) demand and penalty order amounting to Rs 11.81 crore. This order includes a GST demand of Rs 5.9 crore and a corresponding penalty of Rs 5.9 crore, covering the period from July 2017 to March 2021.

The demand and penalty order were issued by the Additional Commissioner of Central Goods and Services Tax in Gurugram. According to a regulatory filing with the stock exchange, Zomato faces a GST demand of Rs 5,90,94,889, along with applicable interest (amount unspecified), and a penalty of equal value.

This development comes on the heels of earlier notices received by Zomato from tax authorities in Delhi and Karnataka. These notices, about alleged short payment of GST in 2018, amounted to Rs 4.2 crore. Zomato had previously announced its intention to challenge these tax demand notices.

In response to the recent GST demand and penalty order, Zomato reiterated its commitment to compliance and stated its intention to contest the order. The company emphasized that it would exercise its right to appeal against the tax demand and penalty.

Despite these regulatory challenges, Zomato has shown resilience in its financial performance. In the third quarter (Q3) of the last fiscal year (FY24), the company recorded a profit of Rs 125 crore. This marks a notable improvement of Rs 390 crore compared to the same quarter in the previous year, showcasing Zomato’s ability to navigate challenges and deliver robust financial results.

As Zomato addresses the GST demand and penalty order, stakeholders will closely monitor the company’s response and any potential impact on its operations and financial health. Amidst regulatory scrutiny, Zomato remains focused on its mission to provide efficient food delivery services while upholding regulatory compliance standards.