The country’s second largest IT company Infosys has got a big relief in the case of alleged tax evasion. The Karnataka government has withdrawn the notice of Rs 32,403 crore sent to the company. This information has been shared by the tech giant in the stock exchange filing on Thursday. Infosys was in the headlines on Wednesday regarding this huge notice and on Thursday itself it had issued a clarification. Let’s know what is the whole matter…
The company gave information to the stock exchange
Infosys said in a stock exchange filing on Thursday, the last trading day, that the company has received a message from the officials of the state of Karnataka, which mentions the withdrawal of the show cause notice sent to it. The company had received a GST demand notice of Rs 32,403 crore a day earlier and the Director General of GST Intelligence (DGGI) had sought a reply on this.
What is the whole matter?
According to the report, this case of tax evasion is from July 2017 to 2021-2022. It is alleged that during this period Infosys received services from its foreign branches but did not pay tax of Rs 32,403 crore on them. The tax document states that Infosys is under investigation for not paying IGST on import of services as a recipient of services.
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The company gave this clarification on the notice
Describing this notice from DGGI as a pre-show cause notice, Infosys clarified on Thursday that according to the rules, GST does not apply to such expenses. According to Infosys, according to a recent circular issued by the Central Board of Indirect Taxes and Customs on the recommendations of the GST Council, services provided by foreign branches to the Indian unit are not subject to GST. GST payment is for credit or refund against export of IT services.
There was a bad effect on the stock
The impact of the news of the company receiving the notice was visible on Infosys Share during trading in the stock market on Thursday, the fourth trading day of the week. The stock of the IT company with a market capitalization of Rs 7.67 lakh crore opened at Rs 1856 at 9.15 am and by the time the market closed, it fell sharply and closed at Rs 1,847.65, down 1.10 percent.
It is worth noting that Infosys had recently announced its quarterly results, in which Infosys’ net profit increased by 7.1 percent year-on-year to Rs 6,368 crore and revenue from operations also jumped to Rs 39,315 crore. There was a 3.6 percent increase in revenue compared to the same quarter a year ago.
Source (PTI) (NDTV) (HINDUSTANTIMES)