The Directorate General of GST Intelligence (DGGI) on Tuesday has issued show cause notice to Amazon India. According to sources, "the intelligence wing of government has alleged that the company has to pay Rs 175 crore to the government."

"As per the show cause notice, DGGI claims that its investigation found calculation errors made by Amazon India. Amazon India initially had paid higher GST but rather than claiming refund, the company took wrong input tax credit (ITC) to settle the excess GST paid," sources privy to the developments told CNBC-TV18.

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DGGI busts Rs 520 crore fake tax-invoice scam; two arrested

"However, noting that it was a due that government had to pay, DGGI is not contesting the excess amount, rather the interest due on wrongfully claiming ITC is what has been demanded from Amazon India. This amounts to Rs 175 crore," sources in the know told CNBC-TV18.

DGGI has sent showcause notice to the Bengaluru office of Amazon India in this regard, asking them to explain and pay up the genuine dues.

"DGGI is yet to hear back from Amazon the the notice," source close to the development said.

Also read: GST fake invoice frauds: DGGI to seek action against 3 erring Chartered Accountants

Meanwhile, CNBC-TV18 has reached out to Amazon India and is awaiting a response from the company.

It is important to note that a nation-wide drive has been initiated by the GST intelligence wing to plug tax leakages.

(Edited by : Jomy)