ixigo to Appeal ₹7.97 Crore Tax Demand Over Calculation Errors

Le Travenues Technology Limited, the company behind the popular ixigo travel platform, has received an Income Tax Assessment Order for Assessment Year 2024-25, resulting in a total demand of ₹7.97 crore. The company disputes the order, citing calculation errors, and plans to file an appeal.

The tax demand includes ₹7.52 crore related to tax on the company's buy-back of shares, alongside ₹0.45 crore on disallowed expenses of ₹1.02 crore.

While ixigo anticipates no significant financial implications beyond legal and contestation expenses, such tax demands can affect investor sentiment. The appeals process will involve incurring legal and administrative costs for the company.

Le Travenues Technology Limited, incorporated in 2006, operates as a leading online travel agency in India, known for brands like Confirmtkt and AbhiBus. The company had a successful Initial Public Offering (IPO) in June 2024, listing on exchanges on June 18.

Following the assessment order, ixigo will initiate the process of filing an appeal with tax authorities. This marks a shift from its primary operational focus to legally addressing this specific tax matter.

The primary risk identified is the incurrence of legal and contestation expenses associated with filing and pursuing the appeal. Although the company states no other financial implications are expected, the outcome of the appeal remains uncertain.

ixigo competes in the Indian online travel agency market against players such as MakeMyTrip Ltd, EaseMyTrip, and Yatra Online Ltd.

Key points to track include ixigo's formal appeal filing, any updates from tax authorities regarding the process, the quantum of legal and contestation expenses incurred, and the final outcome of the tax appeal.