Paisabazaar Receives Notices From The IT Department Regarding Vendor Payments

The Income Tax Department has sent warnings to Paisabazaar, an insurtech platform owned by PB Fintech, about a few vendor payments and the organisations connected to them. The Assistant Commissioner of Income Tax and the Deputy Director of Income Tax in Delhi sent out the notices.

According to the company's regulatory filing, one of the notices is issued under section 142(1) of the Income Tax Act, 1961, and the other is issued under the Prohibition of Benami Property Transactions Act, 1988. The filing further stated that the authorities have requested information and explanations about the payments made to a small number of vendors and the organisations connected to them in relation to the transactions and services they rendered to Paisabazaar.

Paisabazaar to Provide Payment Documentations

According to PB Fintech, the notice mainly asks Paisabazaar to submit records and information pertaining to these payments. Additionally, it stated that it will take all required actions to make its case to the relevant authorities. According to the statement, the corporation will take all required steps to present and defend its case before the appropriate body because it is a notification that requests specific information and documents. The business gave stakeholders the assurance that it is answering the notices within the authorised time frames.

Paisabazaar was Always Under the Vigil

Income tax authorities became aware of Paisabazaar earlier this year due to regulatory laxities and non-compliance with KYC standards. The Securities and Exchange Board of India (SEBI), a market watchdog, issued a show-cause notice to Yashish Dahiya, the former CEO and chairperson of PB Fintech, in June of this year. The $2 million investment made by PB Fintech FZ-LLC, Dubai, in November 2022 to purchase a 26.72% share in the outsourced marketing services firm YKNP Marketing Management was the subject of the show cause notice (SCN).

Concerns over a possible violation of insider trading laws were raised by the SEBI notice. PB Fintech responded by saying that the company's operations and finances are unaffected by this problem. The business added that it is seeking legal advice in order to respond appropriately and handle the situation in compliance with legal standards. The business recently declared that, as of October 17, 2024, its board committees would be reorganised. Chairperson and CEO Yashish Dahiya resigned, while Nilesh Bhaskar Sathe and Kitty Agarwal, both independent directors, joined the audit committee, which was presided over by Kaushik Dutta.

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StartupTalkyNitin Konde