“A recovery survey was conducted at the company’s Gurgaon office on Friday and it continued all through Friday evening. A recovery survey happens when we have determined a company’s tax liability and that company is not paying up those taxes. It is a procedure which involves going to the company’s office to see what assets they have and if we could liquidate some of those to recover taxes,” a tax official familiar with the matter said while another added: “On some occasions, companies agree before the survey that they are not somehow able to pay taxes because they don’t have enough liquidity or assets to pay off the tax. In a recovery survey we try and discover whether what they are stating is true. We try to find out if the company is incapable of paying the taxes it is supposed to pay.”
In a response to ET’s queries an Oyo spokesperson said there was a routine TDS survey in progress in one of the company’s offices.
“We are cooperating with the authorities, and are committed to engaging with all relevant stakeholders. Oyo Hotels & Homes has actively worked in ensuring that the wider unorganised segment is organised, and part of the formal economy. We continue to support small asset owners by creating entrepreneurship opportunities and giving them access to technology and other resources,” the spokesperson added.
In its edition dated January 18 2019, ET had reported that the company had been sent income tax notices for furnishing inaccurate particulars of income. The income tax department had sent notices to parent company Oravel Stays in November and December for assessment year 2016-2017.
People aware of the matter at the time had said the case was linked to non-deduction of tax deducted at source (TDS) on payments made by the company in assessment year 2016-17.
Sources familiar with the matter said the recovery survey on Friday was conducted at Oyo’s new office located on Golf Course Road in Gurgaon and laptops and phones of some employees had been seized during the survey. Oyo's India operations team works out of the Golf Course Road office.
In its edition dated January 4 this month, ET had reported that on directions from investor SoftBank, hospitality chain Oyo Hotels & Homes has set internal deadlines for its self-operated hotels and all ancillary businesses to turn operationally profitable. The Japanese investor wants Oyo to show profitability ahead of a planned initial public offering in 2022-2023 in the US. For self-operated hotels and ancillary businesses, the company has set targets of end-March and July, respectively, to post earnings before interest, tax, depreciation and amortisation. Plans were also afoot to shut down ancillary businesses that do not report an operating profit before end-July as per a mandate from SoftBank, ET had reported.
1 Comment on this Story
ramanath382 days ago
Govt should shut Down all the black market business run by OYO.