Infosys announced on Thursday that Karnataka’s Goods and Services Tax Department has withdrawn the pre-show cause notice issued to the Bengaluru-based software services provider.
The company was asked to provide additional responses to the Directorate General of GST Intelligence’s central authority regarding the matter, though no further details were provided in its statement to the exchanges.
On Wednesday, Infosys responded to reports and clarified that it was under investigation for alleged evasion of Integrated Goods and Service Tax (IGST) amounting to Rs 32,403 crore.
Infosys operates overseas branches outside India, which are considered distinct entities under the IGST Act 2017. The Directorate General of GST Intelligence alleged that Infosys included expenses incurred by these branches in their export invoices from India and calculated the eligible refund based on these export values.
In response to the allegations, Infosys stated, “The company believes that, as per regulations, GST is not applicable on these expenses. Additionally, as per a recent circular issued by the Central Board of Indirect Taxes and Customs on the recommendations of the GST Council, services provided by the overseas branches to Indian entities are not subject to GST.”
Infosys reiterated it has paid all its GST dues and fully complies with central and state regulations. It added that GST payments are eligible for credit or refund against the export of IT services.
From: financialexpress
Financial News
