Meesho shares tumble 10% after ₹1,500 crore tax demand spooks investors
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Shares of e-commerce firm Meesho plunged nearly 10% on Monday, hitting the lower circuit after the company disclosed that it had received an income-tax demand of about ₹1,500 crore for the assessment year 2023–24. The sharp fall came during early trade, with the stock quickly locking in the 10% lower circuit on the national stock exchange.
The fall pushed Meesho's stock to one of its lowest levels in recent months and triggered heightened volatility.
What is the ₹1,500 crore tax demand issued to the company?
According to the company’s regulatory filing, the income tax department of India issued an assessment order under Section 143(3) of the Income Tax Act along with a demand notice under Section 156, raising a total tax demand of ₹1,499.73 crore. The amount includes the tax liability along with applicable interest.
The demand pertains to the financial filings of the company for FY24, with authorities reportedly questioning certain accounting treatments and income reporting in the company’s tax returns.
How has Meesho responded to the tax department’s order?
In its filing to the stock exchanges, Meesho said it does not agree with the observations made by the tax authorities and intends to challenge the order through appropriate legal channels.
The company added that it believes it has “adequate legal and factual grounds” to contest the demand and is currently reviewing the assessment order in detail before initiating the appellate process. Such tax disputes are typically challenged before the commissioner of income tax (appeals) and may continue through higher judicial forums if required.
Market analysts said the steep fall reflects caution toward companies facing large tax claims, particularly in the digital and e-commerce sector where accounting structures are often closely scrutinised.
Will the tax dispute impact Meesho’s financial outlook?
Meesho said the tax demand is not expected to have any immediate material impact on its business operations or financial position. However, analysts said the dispute could remain an overhang on the stock until greater clarity emerges on the legal proceedings.
Meesho made a strong market debut on December 10, 2025, listing at ₹162.50 per share on the NSE, over 46% above the IPO price of ₹111 per share. The shares of Meesho have slipped over 15% since listing.