In a significant development that could have larger implications for India’s travel-tech industry, Jaipur-based Samskara Resorts has lodged an FIR against hospitality giant OYO, alleging that the platform falsely reported thousands of fake bookings to inflate revenue figures. The inflated numbers, according to the resort, led to a staggering ₹2.66 crore GST show cause notice from the tax department.
The complaint, filed by Madan Jain—associated with Samskara Resorts—at Ashok Nagar police station, names Oravel Stays Private Limited (OYO), its founder and CEO Ritesh Agarwal, and others for alleged involvement in cheating, criminal breach of trust, forgery, and criminal conspiracy under the Bharatiya Nyaya Sanhita (BNS).
Credits: The Indian Express
In this article, we will look into the details of the FIR filed against OYO, the allegations of inflated bookings, the impact on partner hotels, and what this could mean for the company’s future.
The Crux of the Allegation
According to the FIR, Samskara Resort had signed a 12-month agreement with OYO on April 18, 2019. During this period—from April 18, 2019 to April 20, 2020—OYO facilitated business worth ₹10.95 lakh, for which the resort duly paid GST.
However, things took a serious turn when Samskara received a GST show cause notice citing a turnover of ₹22.22 crore attributed to their name—allegedly filed by OYO. This discrepancy not only shocked the resort management but also burdened them with a tax liability of ₹2.66 crore, excluding penalties.
The resort claims that OYO falsely recorded bookings even for periods not covered under the signed agreement, including the financial years 2018-19 and 2020-21. Jain alleges that these fake bookings were shown solely to inflate OYO’s annual turnover, leaving partner hotels to deal with the financial and legal aftermath.
Industry Echoes: Not an Isolated Incident
Adding weight to the complaint, Husain Khan, President of the Hotel Federation of Rajasthan, revealed that nearly 20 hotels across the state have received similar GST notices, all allegedly linked to inflated billing by OYO.
“This is not the first time such a controversy has erupted,” Khan said. “Four years ago, around 125 hotels had joined a campaign against OYO, displaying banners outside their properties stating, ‘We do not accept OYO bookings.’ The company has a poor track record when it comes to honoring agreements with hotel partners.”
Such sentiments highlight an ongoing rift between OYO and small hotel owners—many of whom have previously accused the company of opaque accounting, last-minute policy changes, and delayed payments.
OYO Maintains Silence, So Far
Efforts to reach OYO for comment were unsuccessful, with spokesperson Abhishek Sinha unavailable. The company has not released an official statement on the FIR as of now. This silence only adds to the tension, as industry stakeholders await a formal response from one of India’s most high-profile startups.
Founded in 2013, OYO has seen meteoric growth, expanding across India and globally. However, it has also been repeatedly criticized for its aggressive expansion tactics and strained relations with property partners.
What This Means for the Startup Ecosystem
This FIR comes at a sensitive time for OYO, which has long been preparing for a public market debut after multiple delays. Allegations of forgery and tax misreporting could not only delay its IPO further but also trigger a fresh wave of audits, investigations, and loss of investor confidence.
For India’s startup ecosystem, this serves as a wake-up call on the importance of ethical business practices, especially for companies operating on large platforms with hundreds of small vendors and partners.
Credits: Outlook Business
The Road Ahead
As the legal process unfolds, the case could snowball into a broader probe into OYO’s accounting and reporting practices. If more hotels come forward with similar complaints, authorities might be compelled to investigate systemic issues.
For now, Samskara Resorts’ bold move to file an FIR might just be the tip of the iceberg.
