Food delivery firm Swiggy has announced that it had received an assessment order with an additional tax demand exceeding ₹158 crore for the financial year from April 2021 to March 2022.

The order was issued by the Deputy Commissioner of Income Tax, Central Circle – 1(1), Bangalore.

The assessment pertains to alleged violations, including the disallowance of cancellation fees paid to merchants under Section 37 of the Income Tax Act, 1961, and the failure to offer interest income from income tax refunds for taxation.

"The Company has received an assessment order for the period between April 2021 and March 2022, with an addition of Rs 158,25,80,987 (Rs 158.25 crore) being made,” Swiggy said in a regulatory filing:

Swiggy said it believes that it has a strong case on merits and the company will be filing an appeal against the order before the appropriate authority.

“The Company believes that it has strong arguments against the Order and is taking necessary steps to protect its interest through review/appeal. The Company believes that the Order has no major adverse impact on its financials and operations,” it said.

This comes weeks after Swiggy’s quick commerce venture Instamart announced its expansion to 100 cities amid growing demand for 10-minute deliveries, particularly in tier-2 and -3 cities. Over the last month, Swiggy Instamart launched in cities such as Raipur, Siliguri, Jodhpur, and Thanjavur. This comes as Swiggy Instamart faced stiff competition from Blinkit and Zepto in quick commerce in the past 3-4 years and hasn't been able to maintain its early mover advantage, according to HSBC. In the first half of 2025, Swiggy was 75% of Zomato in food delivery and 55% of Blinkit (owned by Zomato) in quick commerce in terms of gross order value (GOV). Profitability is also lagging in both businesses, said HSBC.

“Over the past year, millions of Indians have turned to Swiggy Instamart for everything from groceries and essentials to festive and everyday needs. We have noted that there is significant traction for convenience-led retail much beyond Indian metros, as both consumer behaviour and the value-proposition of quick-commerce evolve in tandem. Our expansion to 100 cities strengthens our reach and allows us to better serve growing consumer needs in underserved geographies,” said Amitesh Jha, CEO of Swiggy Instamart.

“In 2025, one in four new users came from tier 2 or 3 cities, underscoring the growing demand for quick commerce. With this growth, we’re excited to bring the same level of convenience, choice, and value to a much wider base of customers,” said Jha.

With the cricket and festive seasons, Swiggy Instamart is expanding its darkstore network by introducing 'megapods'. These megapods, ranging from 10,000 to 12,000 square feet in size, can house up to 50,000 stock-keeping units (SKUs), giving consumers access to three times the range of products available from a normal dark store.