Infosys Faces Tax Demand But Expects Larger Refund

Preeti Bali / 10:31 am / April 3, 2024

Indian information technology giant Infosys has received a tax demand notice from the Income Tax Department for the assessment year 2020-21. The demand, which includes interest, totals Rs 341 crore and was issued on March 31, 2024.

Evaluating Impact and Considering Appeal

Infosys is currently assessing the potential financial implications of this order on its upcoming quarterly and annual reports ending March 31, 2024. Additionally, the company is considering filing an appeal to contest the tax demand.

Official Statement from Infosys

In a filing submitted to the stock exchange, Infosys stated, “On March 31, 2024, Infosys Ltd (the Company) received an order under Section 201 & 201(A) of the Income Tax Act, 1961, from the Income Tax Department for the assessment year 2020-21. This order includes a tax demand of Rs 341 crore (including interest). The Company is currently evaluating the impact of this order on its financial statements for the quarter and year ending March 31, 2024, and also considering filing an appeal.”

Tax Refund for Subsidiary

In contrast, under Section 154 of the Income Tax Act, 1961, a subsidiary of Infosys was granted a tax refund order totaling Rs 15 crore for the assessment year 2014–15. The company is also evaluating the financial implications of this refund on its statements for the same fiscal period.

Infosys Clarifies on Recent Tax Developments

These tax-related actions are part of ongoing interactions between Infosys and the Income Tax Department. Previously, Infosys announced they anticipate a substantial tax refund of Rs 6,329 crore spanning various assessment years from 2007-08 to 2018-19. However, this positive news was accompanied by a separate tax demand of Rs 2,763 crore for assessment years including 2022-23.

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