Zomatos Challenge Expansion: Updates
Zomato is confronting a GST demand and penalty order totaling Rs 11.81 crore for export services to subsidiaries from July 2017 to March 2021. The company plans to contest the penalty and demand in the appellate court. The order comprises a Rs 5.9 crore GST demand and a corresponding penalty of Rs 5.9 crore, issued by the Additional Commissioner of Central Goods and Services Tax, Gurugram.
Despite providing clarifications and supporting documentation in response to the show cause notice preceding the demand order, Zomato expressed dissatisfaction with the authorities’ response, citing a lack of appreciation for their submissions. Consequently, Zomato intends to appeal the order.
In other news, Zomato unveiled a new service, the ‘large order fleet,’ designed to efficiently handle substantial orders for gatherings, parties, and events. CEO Deepinder Goyal announced the launch on X (formerly Twitter), highlighting that the fleet exclusively comprises electric vehicles. This initiative addresses the previously unmet need for gatherings hosting up to 50 individuals and aims to enhance customer experience by streamlining large order deliveries.
Goyal emphasized the importance of this new feature in improving customer satisfaction, particularly as Zomato previously managed large orders through multiple delivery agents, resulting in suboptimal experiences. The new fleet is still evolving, with plans to incorporate additional features such as cooling compartments and hot boxes with temperature control.
On April 19, Zomato’s shares closed 1.78% higher at Rs 188.50 on the NSE, indicating investor confidence despite the regulatory challenges faced by the company.
