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Flipkart and Swiggy offices under IT scrutiny

Flipkart and Swiggy offices under IT scrutiny
Photo Credit: Reuters
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The Income Tax Department on Friday concluded its ongoing survey at the offices of online food aggregator Swiggy, and InstaKart, a Flipkart unit for logistics and freight services. 

The surveys began on Wednesday. Swiggy has confirmed the development to Techcircle

A source close to one of the companies told TechCircle that the survey was linked to two third party vendors working with the companies.  “Due to a third party vendor’s alleged default, the tax department had initiated a follow-up survey at Swiggy,” the source added.

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The vendors were being checked for the invoices generated against the payments made to both the companies on the suspicion of input tax credit and related tax evasion.

The companies -- Merlin Facilities and Surya Team Management-- had supplied manpower or staff to the companies. Both the companies do business worth Rs 300-400 crore with these vendors. Further, the vendors have been accused of generating bogus invoices to avail input tax credit without having paid goods and services tax, according to a report by The Economic Times. 

“As a law abiding company, we are in full compliance with the tax and legal mandates. Our team extended full cooperation to the concerned authorities during the survey,” Swiggy spokesperson told TechCircle.

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"We believe we are in full compliance with all applicable tax and legal requirements," a spokesperson for Flipkart said in a statement. 

Emails seeking further clarification on the matter went unanswered at the time of publishing this article. 

The surveys are a part of the larger nationwide drive taken up by the tax department against firms and vendors evading GST.

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