Mumbai, July 31: Infosys is currently under investigation by the Directorate General of GST Intelligence (DGGI) for allegedly evading over INR 32,000 crore in integrated goods and service tax (IGST), a report said. According to an internal document accessed by ET Prime, the evasion spans from July 2017 to the 2021-2022 fiscal year.

The report said, the document, dated July 30, 2024, indicates that Infosys is being scrutinised for the non-payment of IGST on the import of services as a recipient. The DGGI asserts that Infosys' overseas branches, established to service clients, are considered 'distinct persons' under the IGST Act. Consequently, Infosys is liable to pay GST under the reverse charge mechanism for supplies received from these branches. Infosys’ Full-Year Employee Strength Drops for First Time in 23 Years by 25,994 in Financial Year 2023-24.

Infosys Accused of Evading Over INR 32,000 Crore GST

The investigation is ongoing, and it is expected to progress to a case report, potentially involving a visit from a DGGI official or a demand for information and a summons. A source familiar with the matter stated that Infosys has received notice of the investigation but maintains that it is in full compliance with state and central GST laws. Infosys Hiring 20,000 Freshers This Year Depending on Growth, IT Company Witnesses Drop in Headcount by 1,908 in April-June Quarter of FY25.

This is not the first time Infosys has faced issues with the GST Department. In April, the Odisha GST Authority imposed a penalty of INR 1.46 lakh on the company for availing of an ineligible input tax credit. However, the scale of the current investigation far exceeds previous issues.

(The above story first appeared on LatestLY on Jul 31, 2024 09:00 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).