Food delivery company Zomato has been issued a notice by the tax authorities demanding Rs 23.26 crore in taxes, including interest and penalty. The company said it will challenge the order before the appropriate authority.
In a regulatory filing, Zomato said it has received a notice from the Assistant Commissioner of Commercial Taxes (Audit), Karnataka, for the financial year 2018-19. The notice demands GST of Rs 11,27,23,564, along with interest and penalty totaling Rs 23,26,64,271.
"We believe that we have a strong case on merits and the Company will be filing an appeal against the order before the appropriate authority," the company said.
The notice comes at a time when Zomato is trying to turn profitable. The company has been investing heavily in marketing and promotions to expand its customer base.
Experts said the notice could impact Zomato's share price.
"The GST notice could weigh on Zomato's share price in the short term," said an analyst at a domestic brokerage firm. "The company will have to provide more clarity on the impact of the notice on its financials."
Zomato's shares closed 2.02% higher at Rs 182.15 on the BSE on Thursday.