Zomato Disputes Tax Responsibility, Citing Delivery Partners' Role in Collection: The company, led by Deepinder Goyal, disclosed to stock exchanges that it received a notice from the Directorate General of GST Intelligence regarding an alleged tax liability of Rs 401.70 crore. Zomato contends that it shouldn't be held accountable for any tax payment as the delivery charges collected are attributed to the delivery partners.
According to Zomato, the collected amount isn't subject to tax since it acts merely as a facilitator in collecting delivery charges on behalf of the partners, who, as per mutual contractual terms, render services directly to customers. Zomato further substantiated its stance by referencing opinions from external legal and tax advisors.
The food delivery and cataloging platform stated its intention to submit an appropriate response to the SCN (Show Cause Notice). In its statement, Zomato emphasized that it possesses a strong case on merit and has voluntarily disclosed the matter as a precautionary measure due to the substantial alleged tax demand involved.
Furthermore, it clarified that disclosures are mandated only for orders accompanied by penalties from authorities or ongoing legal disputes having a tangible impact on the company. Zomato underscored that, currently, no such orders have been issued.
In the meantime, Zomato's shares have surged by 110 percent in the year 2023.
