Company: ZCARW
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110391
Chunk: 289

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 289
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 fleet under its management which indemnifies against personal death and/or injuries suffered
either by the customer or third-parties during the use of its vehicles. Based on the insurance coverage, the Company is confident that
liability, if any, arising from the claims under the previous business model will be covered by the insurance. Further, under the current
business model of the Company, wherein the Company acts only as a facilitator, any issues arising from breach of any terms including
improper use of vehicles and/or physical damages made to the vehicles or any mechanical issues in the vehicle will be the responsibility
of either the host or the customer. While uncertainties are inherent in the final outcome of these matters, the Company believes that
the disposition of these proceedings will not have a material adverse effect on the Company’s financial position, results of operations
or cash flows.

(B) The Company has received various
orders and show cause notices from Indian indirect tax authorities relating to disputes on input tax credits, service tax liabilities,
GST dues, and taxability of car rental revenue for periods between 2014 and 2023, totaling $9,469,331 (March 31, 2025: $9,514,651). These
disputes include disallowance of input credits, service tax liabilities on booking fees and penalty charges, disputes on goods and service
tax input availed, and GST demands on gross booking value. The Company has taken necessary steps, including filing appeals, submissions,
and deposits, and is awaiting further communication from the authorities. In relation to the GST demands on gross booking value, the
Company has filed a writ petition with various authorities challenging the order. Based on the submissions provided and documents available,
management believes that no significant outflow is expected, and therefore, no provision has been recorded as of September 30, 2025 and
March 31, 2025.

(C) In
February 2023, a former employee of Zoomcar India instituted a suit before the City Civil and Sessions Judge at Mayo Hall, Bengaluru
against Zoomcar India, Zoomcar, Inc. and Zoomcar Holdings, Inc. (formerly IOAC) challenging his termination, claiming damages amounting
to $382,445 and claiming that 100,000 options to purchase shares of Zoomcar, Inc. have vested. On March 3, 2023, the City Civil and Sessions
Judge at Mayo Hall, Bengaluru, issued an interim injunction to restrain each of Zoomcar, Inc. and