Swiggy faces tax demands worth over Rs 165 crore, says no major financial impact

IANS April 6, 2025 257 views

Swiggy, a leading online food and grocery delivery platform, is facing significant tax challenges with assessment orders totaling Rs 165 crore. The company received two separate orders from tax authorities in Pune and Bangalore, questioning its tax compliance for the 2021-22 financial year. Despite the substantial tax demands, Swiggy remains confident in its legal position and plans to challenge both orders through reviews and appeals. The company has strongly stated that these tax issues will not cause any major disruption to its financial or operational capabilities.

"The Company believes that it has strong arguments against the Order" - Swiggy Regulatory Filing
Swiggy faces tax demands worth over Rs 165 crore, says no major financial impact
New Delhi, April 6: Online food and grocery delivery platform Swiggy is facing fresh tax troubles after receiving two assessment orders related to the financial year 2021-22.

Key Points

1

Pune tax order demands Rs 7.59 crore for profession tax non-compliance

2

Bangalore tax order seeks Rs 158 crore on various income issues

3

Swiggy plans to file review and appeal against both orders

4

Company asserts no major operational or financial disruption

The total tax demand stands at over Rs 165 crore. In a regulatory filing on Saturday, Swiggy said it received an order from the Office of the Profession Tax Officer in Pune, demanding Rs 7.59 crore.

The order alleges that the company failed to properly deduct profession tax from employees' salaries, which is required under the Maharashtra State Tax on Professions, Trades, Callings & Employments Act, 1975.

Swiggy, however, maintained that it has strong grounds to challenge the order and is planning to file a review or appeal.

"The Company believes that it has strong arguments against the Order and is taking necessary steps to protect its interest through review/appeal," Swiggy stated in its filing.

The company also clarified that the issue will not have a significant impact on its finances or operations.

This development comes just days after Swiggy was served another assessment order by the Deputy Commissioner of Income Tax, Central Circle 1(1), Bangalore.

This order demands an additional tax of over Rs 158 crore, also for the April 2021 to March 2022 period.

The larger tax demand is linked to issues such as cancellation charges paid to merchants, which the authorities have disallowed under Section 37 of the Income-tax Act, 1961.

It also includes interest income from income tax refunds, which the authorities claim was not properly declared.

"The Company has received an assessment order for the period April 2021 to March 2022 where an addition of Rs 158,25,80,987 (one hundred and fifty-eight crores, twenty-five lakhs, eighty thousand nine hundred and eighty seven, only) has been made," Swiggy said in a regulatory filing.

Swiggy said it is confident in its legal position and is taking necessary steps to appeal the tax order. Just like in the profession tax matter, the company said this order too will not cause any major adverse effect on its financials or day-to-day operations.

Reader Comments

R
Rahul K.
Not surprised to see this. Many startups play fast and loose with tax rules in their growth phase. Hope Swiggy gets this sorted properly. Their delivery service is too good to be affected by financial troubles! 🚴‍♂️
P
Priya M.
165 crore sounds like a lot, but Swiggy processes way bigger amounts daily. If they say it won't impact operations, I believe them. Just don't increase my delivery fees please!
A
Arjun S.
This seems like a case of unclear tax regulations for new business models. The government needs to update tax laws to account for digital platforms instead of retroactively applying old rules.
S
Sneha P.
As a former Swiggy employee, I'm surprised about the profession tax issue. They were always very strict about deductions from our salaries. Maybe it's some technicality in Maharashtra's laws?
V
Vikram J.
While I appreciate Swiggy's service, companies of this size should have better tax compliance teams. This isn't some small startup anymore - they should set an example for proper corporate governance.
N
Neha R.
Hope this doesn't affect their delivery partners' payments. Those guys work so hard in all weather conditions. The company should prioritize their earnings over everything else.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

Tags:
Swiggy Tax Demand Income Tax Regulatory Challenge Food Delivery Taxation
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