Eternal hit with over ₹40 crore tax demand, penalty; Zomato parent to appeal orders

Eternal Limited, which owns the Zomato and Blinkit brands, on Monday said it has received three tax orders from the GST department, raising a demand of over ₹40 crore in tax, interest and penalty.

These orders have been received from the Joint Commissioner-4 Bengaluru for the period from July 2017 to March 2020.

The orders, dated August 25, 2025, confirm a total GST demand of ₹17.19 crore, interest of ₹21.42 crore and penalty of ₹1.71 crore, the company informed stock exchanges.

"The company has received 3 orders on 25 August 2025 for the period July 2017 to March 2020 passed by Joint Commissioner, Appeals-4, Bengaluru, confirming total demand of GST of Rs 17,19,11,762 with interest of Rs 21,42,14,791 and penalty of INR 1,71,91,177," Eternal said in a late night regulatory filing on Monday.

While one order pertained to alleged short payment of output tax, two others were related to alleged excess availment of input tax credit.

"We believe that we have a strong case on merits, backed by view from lawyers, and the company will be filing appeals against the orders before the appropriate authority," Eternal said in the filing.

The company added that it does not expect any financial impact from the orders. Eternal, which was earlier known as Zomato Limited, rebranded earlier this year.

Shares of Eternal were trading in red at around 10.40 am.

The company posted a net profit of ₹25 crore for the quarter ended June 30, 2025 (Q1 FY26), against ₹39 crore in the preceding quarter and ₹253 crore in the year-ago period.

Revenue from operations, however, surged 70 per cent year-on-year to ₹7,167 crore from ₹4,206 crore in the same quarter last year, supported by strong growth in its consumer businesses.

In its letter to shareholders, Eternal said net order value (NOV) of its B2C businesses grew 55% YoY (16% QoQ) to ₹20,183 crore in Q1 FY26. This was the first quarter where its quick commerce NOV exceeded food delivery NOV for the full quarter.