Eternal Gets Tax Demand Order For FY22

Food delivery and quick commerce company Eternal has received a tax demand and penalty order of INR 1.34 Cr for the financial year 2021-22.

The company, which owns Zomato and Blinkit, said in a stock exchange filing that the Deputy Commissioner of State Tax, Lucknow, Uttar Pradesh, passed the order on August 6 under Section 74 of the CGST and UPGST Acts.

The total amount comprises INR 67.25 Lakh as tax demand and an equal amount as penalty, in addition to applicable interest.

The demand was raised on account of short payment of output tax and excess availment of input tax credit.

“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,” Eternal stated in a filing.

This comes at a time when Alibaba Group affiliate Antfin is reportedly set to sell 18.8 Cr shares of Eternal in a block deal worth around INR 5,375 Cr.

As per Eternal’s shareholding available on exchanges, Antfin held a 1.95% stake in the company at the end of June quarter.

Receiving GST notices on grounds of non-payment of tax is not uncommon for companies like Eternal, and multiple state government offices have indeed issued such notices.

For instance, Eternal received a GST demand notice and penalty demand of INR 803 Cr from CGST and Central Excise of Thane Commissionerate in December last year.

Prior to that, the governments of Haryana, Karnataka, Tamil Nadu and West Bengal have also issued GST notices to the company in the past year.

On the financial front, the company’s net profit for the first quarter of FY26 slid 90% to INR 25 Cr from INR 253 in the year-ago period. Eternal’s operating revenue jumped over 70% to INR 7,167 Cr from INR 4,206 Cr in Q1 FY25. 

Shares of Eternal ended 0.97% higher at INR 301.80 apiece on the BSE today, compared to its previous close of INR 298.90 per share from Wednesday.