In Karnataka, the tax demand and penalty amount to Rs 23.26 crore, while in Gujarat, it amounts to Rs 8.57 crore. Zomato has expressed its intention to appeal these orders, stating that it believes it has a strong case on merits.
The penalties are related to the alleged overuse of input tax credits and underpayment of GST for the financial year 2018–19.
The platform, however, is contesting the tax demands and penalties, asserting that it has complied with the relevant tax regulations and that the authorities have not properly evaluated its responses and documentation.
"The company, in its response to the show cause notice, had clarified the issue along with relevant documents and judicial precedents, which appears to not have been appreciated by the authorities while passing the order," it said in an exchange filing.
Zomato added further: "The company has received an order for FY 2018-19 under the audit of GST returns and accounts by the Deputy Commissioner of State Tax, Gujarat raising demand of GST of Rs 4,11,68,604, along with applicable interest and penalty totaling to Rs 8,57,77,696."
