Infosys to challenge Rs 577-crore tax demand notice
Zee Media Bureau
New Delhi: Infosys Ltd on Monday said that it would challenge the tax demand raised by Income Tax department earlier this month, a news wire has reported.
The Income Tax department has slapped a fresh Rs 577-crore tax demand notice on Infosys for 2009-10 assessment year, adding to the tax woes of India's second largest IT firm.
The IT major is already contesting additional Income Tax demands of about Rs 1,175 crore (USD 214 million) for four fiscals years beginning 2005.
Infosys, which is also a US-listed company, in a filing to the US Securities and Exchange Commission (SEC) last week had said : "The company has received the assessment order from the Income tax authorities for fiscal 2009 on May 2, 2013 along with a demand order for an amount of USD 106 million."
Infosys is already facing tax demands worth USD 214 million for fiscal 2005 to fiscal 2008 "mainly on account of disallowance of a portion of the deduction claimed by the company under Section 10A of the Income Tax Act".
"The company has received demands from the Indian IT authorities for payments of additional taxes totalling USD 214 million, including interest of USD 62 million upon completion of their tax review for fiscal 2005, fiscal 2006, fiscal 2007 and fiscal 2008," it said in the filing.
The deductible amount is determined by the ratio of export turnover to total turnover. The disallowance arose from certain expenses incurred in foreign currency being reduced from export turnover, but not reduced from total turnover, it added.
The tax demand for fiscal 2007 and fiscal 2008 also includes disallowance of portion of profit earned outside India from the STP units and disallowance of profits earned from SEZ units, it said.
"The matter for fiscal 2005, fiscal 2006, fiscal 2007 and fiscal 2008 are pending before the Commissioner of Income tax (Appeals) Bangalore," Infosys said in the filing.
With Agency Inputs