Flipkart Under the Lens for Alleged GST Billing Tweaks

Billing rejig was to claim lower GST rates applicable to goods transport agencies

- Sakshi Sadashiv

Flipkart is under preliminary investigation over allegations that the Walmart-owned online marketplace altered its billing structure to reduce its goods and services tax (GST) liability, two tax investigators said. Flipkart allegedly rejigged its billing model by recasting marketplace fees collected from its vendors as transport charges to claim lower GST rates applicable to goods transport agencies by shifting revenue to a category meant for small road transporters.

The Directorate General of Goods and Services Tax Intelligence (DGGI) is conducting due diligence into complaints against Flipkart, officials said. "We will send a show-cause notice for prosecution once we have accumulated full proof," said a DGGI official. "We are obliged to take cognisance of every such complaint, as e-commerce platforms are not allowed to do this," another official added. Both of them declined to be identified.