I-T dept alleges Rs 950 cr tax evasion by Flipkart firm, Swiggy

14-01-2021

The Income Tax (I-T) department has uncovered massive tax evasion by flood aggregator Swiggy and Instakart, a group company of Walmart-owned Flipkart. According to the initial probe by I-T department, third party vendors may also be involved in the tax concealment pegged at Rs 950 crore, according to business daily Business Standard. The department impounded incriminating documents after survey operations on the premises of the companies. The documents pointed towards non-deduction of tax deducted at source (TDS) on commission income and cancellation charges by Swiggy and its restaurants with the shifting of loss from Flipkart to Instakart, according to one I-T sleuth who spoke to the newspaper. Tax evasion by Walmart-owned Flipkart company amounts to Rs 650 crore while the rest of Rs 300 crore is attributed to Swiggy, the report added. The survey was in connection with Directorate General of GST Intelligence (DGCI) led probe over alleged wrongful tax credit under goods & services tax (GST). During the survey, we fully cooperated and provided all documents to the complete satisfaction of the tax officials in support of our compliance and record management. Our senior officials have appeared before tax authorities from time to time and provided all information and clarifications as sought. We will continue to work with the tax authority as and when we hear from them, the spokesperson told. Swiggy said it is yet to receive any updates from investigative agencies. The surveys had sought to ascertain the veracity of payments made by the companies to two vendors- Merlin Facilities Pvt Ltd (MFPL), and Surya Team Management Pvt Ltd (STMPL), that had supplied staff to the companies. As per allegations by agencies, Instakart availed of and utilised input tax credit (ITC) on fake invoices of STMPL and MFPL, earlier reports said.