Company: ZCARW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076590
Chunk: 219

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 2
Chunk 219
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, 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 $9,799,311 (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 June 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 $395,772 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 Zoomcar Holdings, Inc. from “alienating or dealing” the 100,000 shares of Zoomcar, Inc. claimed by the former employee while the suit is pending. Zoomcar believes that such claims are baseless and is attempting to have the interim order vacated. In addition, Zoomcar India filed an application in the former employee’s suit, seeking