Infosys tax notice pulled; DGGI awaiting further response

Infosys tax notice rescinded: IT giant Infosys announced that Karnataka state authorities have withdrawn the pre-show cause notice issued a day earlier on August 1. The company has been instructed to provide further responses to the Directorate General of Goods and Services Tax Intelligence (DGGI) regarding the issue.

On July 31, Infosys, India’s second-largest IT company, received a demand from the DGGI for alleged tax evasion amounting to over Rs 32,000 crore.

Updated directive for infosys

Infosys stated, "The company has received a communication from Karnataka state authorities, withdrawing the pre-show cause notice and directing the company to submit further responses to DGGI central authority on this matter," in a statement on August 1.

The pre-show cause notice from DGGI was issued soon after media reports surfaced about the Karnataka state GST authorities' notice on the same matter, the firm informed the exchanges on July 31.

The tax demand from authorities surprised many, given Infosys' reputation for strong governance and compliance.

GST compliance confirmed

In response to the reports, Infosys asserted that it has paid all dues and that GST is not applicable to the expenses claimed by DGGI. "Infosys has paid all its GST dues and is fully compliant with central and state regulations on this matter," the company said in its filing.

In September 2023, Infosys had received a GST demand totaling Rs 37.75 lakh, which was also contested by the firm.

(With Reuters Inputs)