The Central Goods and Services Tax (CGST) department has imposed a penalty of Rs 1.19 crore on fintech giant Paytm's parent company One97 Communications Limited for non-compliance with tax rules. However, the company said that the order is not legally tenable and it is evaluating options, including filing an appeal.

"Based on the assessment and expert advice, the company believes that the demand for penalty is not maintainable and is evaluating all options, including filing an appeal against the order," Paytm said in an exchange filing. According to a stock exchange filing on Tuesday, Paytm received a penalty demand order on February 3, 2025.

The tax department claims that the company violated the provisions of the Goods and Services Tax Act, 2017, relating to the issuance of tax invoices for the financial years 2020-21, 2021-22 and 2022-23.

The company's CEO Vijay Shekhar Sharma has also been fined Rs 59.9 lakh. In August last year, the Collector of Stamps, New Delhi, had ordered One97 Communications to pay a penalty of Rs 47.12 lakh for non-payment of stamp duty on allotment of equity shares in previous years.