Company: ZCARW
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-014437
Chunk: 333

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-02-14
Form: 10-Q
Item: Part I, Item 8
Chunk 333
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 in the ordinary course of business. The Company accrues for losses associated with legal claims
when such losses are probable and can be reasonably estimated. These accruals are adjusted as additional information becomes available
or circumstances change.

(A)Claims filed by customers and third-parties not acknowledged as liability amounted to $4,075,587 and $4,565,949
as at December 31, 2024 and March 31, 2024, respectively. The claims made by the customers against the Company includes claims that have
been made for amounts charged to customers by the Company as damages for improper use of vehicles and/or physical damages made to vehicles
during an active trip ; or claims made by customers for unavailability of the booked vehicle or for any mechanical default in the booked
vehicle ; or claims against any similar issue faced by either the host or the customer. Under the erstwhile business model of the Company
, the Company had procured third-party insurance policies for 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.

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(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 $15,934,836 (March 31, 2024: $7,984,418). 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