[Update] OYO Terms Jaipur Resort’s FIR Misleading

Update | April 23, 11:40 PM 

The below story has been updated to include OYO’s statement and to reflect revisions based on the latest version of the Indian Express report.

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A week after a Jaipur-based resort reportedly filed an FIR against OYO for receiving GST show cause notices worth INR 2.66 Cr, the hospitality major has now rubbished the allegations. 

In a statement, a company spokesperson claimed that the hotelier (Madan Singh Jain, managing director of Samskara Resort) is “deliberately attempting to shift focus from his own GST liabilities by falsely implicating OYO”. The travel tech major claimed that the “misleading FIR would be quashed in due course of time”.

“The hotelier is deliberately attempting to shift focus from his own GST liabilities by falsely implicating OYO. Our records clearly show that a significant portion of the bookings at the property were walk-ins, likely entered directly by the hotel’s staff during the contractual period. This entirely disproves the baseless allegation of fake bookings. OYO has had no business association with this hotel for (the) last 3-4 years. We are confident that the misleading FIR will be quashed in due course,” said an OYO spokesperson. 

Alongside, the company said that it has initiated defamation proceedings against Jain before the Delhi High Court (HC). The company also said that the FIR does not mention founder and CEO Ritesh Agarwal, in contrast to what previous media reports claimed. 

“It is important to note that the complaint is against an ‘unknown person’ and does not mention Ritesh Agarwal. We have also initiated defamation proceedings against Madan Singh Jain, Director of Samskara Resort, before the Hon’ble Delhi High Court,” the spokesperson added. 

What The Jaipur-Based Resort Alleged

This comes a week after an Indian Express report claimed that Jain filed the FIR at Jaipur’s Ashok Nagar police station, alleging that OYO provided “incorrect information” that resulted in the issuance of GST notices totalling INR 2.66 Cr. As per the report, the FIR named several persons for cheating, criminal breach of trust, forgery and criminal conspiracy under the Bharatiya Nyaya Sanhita (BNS).

As per the FIR, Samskara Resorts in Jaipur signed an agreement with OYO on April 18, 2019 for a period of 12 months. The resort claimed to have seen business transactions totalling INR 10.95 Lakh during the period, for which it claimed to have paid the GST dues. 

However, the FIR claimed that OYO allegedly showed bookings worth INR 22.22 Cr between financial years 2018-19, 2019-20, and 2020-21 with Samskara, for which the GST bill of INR 2.66 Cr is still pending, apart from penalty.

Founded in 2012 by Agarwal, OYO offers holiday homes, casino hotels, coworking spaces, budget hotels, corporate stays, and more. The startup has raised nearly $4.5 Bn in funding to date and counts the likes of SoftBank Group and Microsoft among its backers.

Earlier this month, Agarwal, internally, told employees in an email that the startup was on track to clock 60% year-on-year (YoY) revenue growth in the fourth quarter (Q4) of the fiscal year 2024-25 (FY25) to INR 2,100 Cr.

“A key contributor to this performance has been the successful integration of G6 Hospitality, adding INR 275 Cr to our revenue,” Agarwal said in the email.

OYO clocked its maiden profitable year in FY24, posting a net profit of INR 229 Cr as against a net loss of INR 1,286.5 Cr in the previous year. However, revenue declined 1.3% to INR 5,388.78 Cr during the year under review from INR 5,463.9 Cr in FY23.