Food delivery firm Zomato has acquired a Good and Services Tax (GST) notice over a tax legal responsibility of Rs 401.7 crore, based on media report which added that the Directorate General of GST Intelligence (DGGI) had issued tax notices to Zomato and Swiggy for allegedly not clearing GST on delivery prices. It mentioned that delivery prices come beneath the providers class and they’re liable to pay 18 per cent GST, the report mentioned.
In its response to the show cause notice, Zomato mentioned that it’s not liable to pay the tax.
“The delivery charge is collected by the company on behalf of the delivery partners. Further, in view of the contractual terms and conditions mutually agreed upon, the delivery partners have provided the delivery services to the customers and not the company,” Zomato mentioned in a disclosure assertion.
“This is also supported by opinions from our external legal and tax advisors. The Company will be filing an appropriate response to the show cause notice,” Zomato added.
According to the report, Zomato has been requested by the tax authorities to pay penalties and curiosity from October 2019 to March 2022.
