Zomato and Swiggy Receive GST Demand Notices for Dues Amounting to Rs 750 Crore from DGGI, Reports Indicate
The Directorate General of GST Intelligence (DGGI) has reportedly issued GST demand notices to Zomato and Swiggy, amounting to Rs 400 crore and Rs 350 crore, respectively.
Zomato and Swiggy Receive GST Demand Notices for Dues Amounting to Rs 750 Crore from DGGI, Reports Indicate
The Directorate General of GST Intelligence (DGGI) has reportedly issued GST demand notices to Zomato and Swiggy, amounting to Rs 400 crore and Rs 350 crore, respectively. DGGI contends that, as food delivery is a service, these platforms are obligated to pay GST. Zomato's shares closed 1.07% lower at Rs 15.25 each.
The disagreement revolves around whether the 'delivery charge' collected by these platforms is considered a taxable service under GST regulations. In 2022, both companies were instructed to collect and deposit tax at a 5% rate on their orders, a departure from the previous practice where only GST-registered restaurants handled tax collection and deposition.
Last month, Swiggy raised the platform fee for food orders from Rs 2 to Rs 3. Zomato's Q2 results showed a consolidated net profit of Rs 36 crore, a significant improvement from the net loss of Rs 251 crore in Q2 FY23. This marks a 1,700% increase compared to the previous quarter's net profit of Rs 2 crore.
The company's revenue from operations saw a substantial growth of 71.46%, reaching Rs 2,848 crore in the reviewed quarter, compared to Rs 1,661 crore the previous year. The total income for Q2FY24 was Rs 3,060 crore, up 67.12% year-on-year and 17.82% quarter-on-quarter from Rs 2,597 crore in Q1FY24.
Revenue from operations for the quarter increased by 71%, reaching Rs 2,848 crore, surpassing Street expectations of Rs 2,607 crore. The gross order value (GOV) across Zomato's B2C businesses, including food delivery, quick commerce, and going-out services, grew by 47% year-on-year to Rs 11,422 crore.
Also Read: Statutory & Compliance Calendar For November 2023
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Krishna Gopal Varshney
An editor at apnokacaKrishna Gopal Varshney, Founder & CEO of Myitronline Global Services Private Limited at Delhi. A dedicated and tireless Expert Service Provider for the clients seeking tax filing assistance and all other essential requirements associated with Business/Professional establishment. Connect to us and let us give the Best Support to make you a Success. Visit our website for latest Business News and IT Updates.
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Krishna Gopal Varshney
An editor at Myitronline
Krishna Gopal Varshney, Founder & CEO of Myitronline Global Services Private Limited at Delhi. A dedicated and tireless Expert Service Provider for the clients seeking tax filing assistance and all other essential requirements associated with Business/Professional establishment. Connect to us and let us give the Best Support to make you a Success. Visit our website for latest Business News and IT Updates.
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