Delhivery Gets INR 49 Cr Tax Demand Notice

Logistics giant Delhivery has received a demand notice from the Directorate General of GST Intelligence (DGGI), Mumbai Zonal Unit.

In an exchange filing, the company said that it has received a show cause notice on May 6 under the CGST Act, 2017 and IGST Act, 2017 from  DGGI, Mumbai Zonal Unit. 

The company also informed that the financial implication of this notice amounts to INR 49.19 Cr, including interest and penalty.

The core issue is a dispute over the correct GST rate applicable to certain services Delhivery provided under the CGST and IGST Acts.

This isn’t the first instance of Delhivery being slapped with a tax notice. The company in February received a tax demand order from the West Bengal GST department, asking it to pay INR 5.35 Cr. Last year, it also received a demand notice from Karnataka GST authorities. 

The development comes on the back of Delhivery last month informing stock exchanges that it is acquiring a 99.4% stake in Ecom Express for INR 1,407 Cr via distressed sale (almost an 80% valuation drop from Ecom Express’s last valuation of INR 7,300 Cr).

The company said that this acquisition will help it improve its overall profitability, scale up its operations and reduce costs.

Addressing concerns around the impact of the deal on its financials, Delhivery clarified that the risks are minimal as no new technology integrations will need to be “created or changed.” It also downplayed the potential impact of Ecom Express’s mounting losses on its own bottom line. Ecom Express’s net loss increased to INR 398 Cr in the first nine months of FY25.

Founded in 2011 by Sahil Barua, Mohit Tandon, Bhavesh Manglani, Suraj Saharan and Kapil Bharati, Delhivery is a transportation, supply chain and logistics company. 

It counts the likes of SoftBank, Nexus Venture Partners and Fidelity Investments among its backers and competes with the likes of Xpressbees, Blue Dart, Flipkart’s Ekart Logistics and Amazon Shipping.

After turning profitable in Q3 FY24, Delhivery further strengthened its position by posting a 114% YoY rise in net profit to INR 24.98 Cr in Q3 FY25, driven by strong topline growth. Its total revenue stood at INR 2,476.96 Cr during the quarter under review.

The company has also undergone some leadership changes lately. 

It onboarded former Airtel executive Vani Venkatesh as its chief business officer while also roping in boAt cofounder Sameer Mehta as a non-executive independent director and Emcure Pharmaceuticals’ Namita Thapar as an independent director. 

Notably, a slew of GST demand notices has been received by listed and unlisted companies like Swiggy, Urban Company, and Nazara, among others, in recent times.