Paytm Parent Slapped With INR 1.19 Cr GST Penalty

CGST Slaps INR 1.19 Cr Penalty On Paytm Over Tax Invoice Non-Compliance

SUMMARY

Delhi North CGST authorities has imposed penalties worth INR 1.19 Cr on One97 Communications and INR 59.94 Lakh on its CEO

The order pertains to alleged non-compliance in issuance of tax invoices by the company to its customers during FY21, FY22 and FY23

The company's revenue declined 36% YoY to INR 1,827.8 Cr in Q3 FY25, while net loss narrowed to INR 208.5 Cr

Delhi goods and services tax (GST) authorities have slapped a fine of INR 59.94 Lakh on Paytm founder and CEO Vijay Shekhar Sharma.

In an exchange filing, the fintech major said that the Joint Commissioner of Adjudication, CGST Delhi North, has also imposed an additional penalty of INR 1.19 Cr on its parent One97 Communications for flouting tax norms

Cumulatively, the company and its top executive have been fined nearly INR 1.8 Cr for alleged non-compliance in issuance of tax invoices by the company to its customers. The order, dated February 3, 2025, pertains to alleged violations during financial years 2020-21 (FY21), FY22 and FY23.

The fintech major now plans to appeal against the order. Paytm also said that the penalty will have no impact on operations or other activities of the company.

“The Company, based on its assessment and expert advice, believes that the penalty demand is not maintainable and is evaluating all options, including filing an appeal against the order,” the filing said.

The development comes at a time when Paytm has been trying to chart a turnaround on the financial front after the Reserve Bank of India’s (RBI) crackdown on its Paytm Payments Bank last year.

Paytm managed to narrow its consolidated net loss by 6% to INR 208.5 Cr in the December quarter (Q3) of the financial year 2024-25 (FY25) from INR 221.7 Cr in the same quarter last year on the back of recovery in its digital payments business. Its operating revenue declined 36% year-on-year (YoY) to INR 1,827.8 Cr in the quarter under review.

It must be noted that the Vijay Shekhar Sharma-led company posted a net profit of INR 930 Cr in Q2 FY25 on account of the sale of its movie and events ticketing business to foodtech major Zomato.