Cloudtail, a joint venture initiative of Catamaran Ventures and Amazon, is facing a Rs 54.5-crore tax demand along with interest and penalties from the Directorate General of Goods and Service Tax Intelligence, as per a report by The Guardian.

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Catamaran Ventures is owned by Infosys co-founder N.R. Narayana Murthy.

The Guardian has not disclosed the details of the tax dispute. A statement released by Cloudtail says, “Cloudtail has disputed the service tax claim by the authorities and the matter is before the adjudicating authorities. Cloudtail has been disclosing this as a contingent liability in its Annual Report since 2019 as per Indian Accounting Standards. Since this matter is sub judice, we are unable to comment any further. Cloudtail reiterates that it is in full compliance with the laws of India.”

Cloudtail, which reported a revenue of Rs 11,413 crore for financial year 2020, posted a net profit of Rs 67.5 crore. They had revenues of Rs 8,945 crore in the previous year. The company, one of the largest sellers on Amazon India, is owned by Prione Business Services. Catamaran Ventures has a 76 percent stake in Prione Business Services. The rest is owned by Amazon India.

Cloudtail and Appario Retail -- a joint venture of Amazon and Patni -- have been in the news, with both the Confederation of All India Traders (CAIT) and Delhi Vyapar Mahasangh (DVM) alleging that preferential treatment is being meted out by Amazon to these parties as Amazon has a stake in both these retail companies.

A few days ago, both Amazon and Flipkart had a setback when the Karnataka High Court rejected their pleas against a probe by the Competition Commission of India (CCI) for alleged violation of competition laws.

(Edited by : Shoma)