Urban Company Faces GST Notice for ₹51 Crore Over Alleged Tax Evasion

Urban Company has received a GST show-cause notice from the Directorate General of GST Intelligence, Mumbai, for alleged non-payment of taxes amounting to ₹51.3 crore. The notice also includes a penalty and interest imposed on the company.

The matter relates to the non-payment of GST during the period from April 2021 to March 2025 across multiple states in India.

Reason Behind the Notice

The notice reportedly stems from differences in interpretation of the GST provisions under Section 9(5) of the CGST Act 2017. Urban Company has been paying a 5% GST on payments made to professionals providing services such as plumbing, carpentry, electrician work, and cleaning, which the company categorises under housekeeping services.

However, the tax authorities contend that the definition of housekeeping services under Section 9(5) also covers services such as appliance repair, appliance servicing, and painting — additional services offered by the company. This difference in interpretation has led to the issuance of the show-cause notice.

Urban Company’s Response

The company has expressed confidence in its legal position, stating that it has a strong case supported by its legal and tax advisors. Urban Company has confirmed that it will respond to the notice within the prescribed timeline.

Furthermore, the company has emphasised that the notice will not impact its operations, financial health, or other business activities. This assurance is aimed at maintaining confidence among investors, partners, and customers alike.

Urban Company’s Market Debut

Urban Company recently made its stock market debut on September 17, 2025, receiving a highly positive response from investors. Its shares listed at a 57.5% premium, closing the first day at ₹169. This strong debut highlighted the market’s confidence in the company’s growth prospects despite ongoing regulatory challenges.

Even following the issuance of the GST notice, as of September 30, 2025 at 14:59, Urban Company share price was ₹167.51, down ₹2.39 or 1.41%., reflecting market reactions to regulatory developments while investors continue to monitor the situation.

Read more: Urban Company Makes a Strong Market Debut with Nearly 60% Listing Gains

Conclusion

While Urban Company faces a significant regulatory challenge with the ₹51.3 crore GST show-cause notice, the company appears well-prepared to address the issue.

As the company responds to the notice within the prescribed timeline, stakeholders will be watching closely. Meanwhile, Urban Company continues to focus on growth, innovation, and maintaining its reputation as a leading platform for professional services across India.

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