Policy · Professional & Local Services

PRISM gets ₹3,885 Cr tax relief from tribunal

By Startup Enthusiast · 12 June 2026

What they do

The Income Tax Appellate Tribunal granted tax relief of ₹3,885.51 Cr on an angel tax demand

The company is preparing for its third IPO attempt, targeting a valuation of $7-8 Bn

Shareholders have approved raising up to ₹6,650 Cr via fresh equity for the IPO

PRISM (formerly OYO) received tax relief of ₹3,885.51 Cr from the Income Tax Appellate Tribunal (ITAT).
The relief was on an angel tax demand related to share premium from its parent Oravel Stays Ltd.
The tax demand arose from share premium received by OYO from Oravel Stays Ltd (OSL) in 2021-22 after a demerger.
The assessing officer had rejected OYO's valuation report, claiming the premium was excessive.
OYO's net worth as of March 31, 2020 was negative ₹36,663 Cr, which improved to ₹376.57 Cr after share capital infusion from OSL.
The original tax demand was ₹3,737.99 Cr for excess share premium plus ₹147.52 Cr for conversion of CCPS into equity.
The Delhi High Court had earlier stayed recovery of about ₹1,140 Cr tax demand from OYO for CCPS issue in 2020-21.
PRISM is making its third attempt at an IPO in India and has received SEBI approval last week.

The tax relief removes a major legal uncertainty for PRISM ahead of its planned IPO.
The company is targeting a valuation of $7 Bn to $8 Bn for the IPO.
Shareholders have approved raising up to ₹6,650 Cr via fresh equity shares for the proposed IPO.
PRISM is expected to file an updated DRHP (draft red herring prospectus, a preliminary document for IPO) soon.

PRISM (formerly OYO) operates a platform for booking hotels, homes, and other accommodations.
The company connects travelers with property owners and hotel operators.
It generates revenue through commissions, fees, and service charges from bookings.
OYO was founded in 2013 and has expanded to multiple countries.
The company has faced financial challenges, including negative net worth in the past.