Le Travenues Technology (Ixigo) has received a tax demand notice for Rs 23.79 crore from the Assistant Commissioner of Commercial Taxes regarding GST on passenger transportation services for FY 2022-23. The company maintains that it has correctly paid 5% GST under the applicable Act and intends to contest the demand, citing previous success in dismissing a similar notice for the prior fiscal year.
Le Travenues Technology Faces Rs 23.79 Crore GST Demand for FY23
Aggregate Demand: Rs 23.79 crore; Applicable Period: FY 2022-23.
Reader Takeaway: Management is contesting the GST demand, citing a successful precedent for identical tax classification arguments.
What just happened
Le Travenues Technology, the parent company of travel platform Ixigo, has been issued a show cause notice by the Assistant Commissioner of Commercial Taxes in Bangalore. The authorities have raised an aggregate demand of Rs 23.79 crore, which includes Rs 13.75 crore in tax, Rs 8.67 crore in interest, and Rs 1.38 crore in penalties related to FY 2022-23.
Why this matters
The dispute concerns the GST rate applied to passenger transportation services. The company currently classifies these services under HSN 996422 at a 5% GST rate as per Section 9(5) of the CGST Act. The tax authorities contend that because the company holds other registrations for IT and advertising services taxed at 18%, it should also apply the 18% rate to its transportation services. This discrepancy in tax interpretation represents a significant financial liability if upheld.
The backstory
This is not the first time the company has faced this issue. In October 2025, the company disclosed a similar show cause notice for FY 2021-22 involving a Rs 3.05 crore demand. The company successfully defended its position through written submissions and a personal hearing, leading to the authorities dropping the demand. Management believes the current notice is based on the same faulty premise and is preparing a comprehensive response in consultation with tax advisors.
Risks to watch
Investors should monitor the outcome of the upcoming response and hearings. While the company has past success in a similar case, there is no guarantee the current authority will accept identical arguments. Any unfavorable order could require financial provisioning, impacting immediate cash flow and earnings.
What to track next
Watch for exchange filings regarding the company's formal response to the tax authorities and any subsequent updates on the status of the proceedings.