Mumbai, August 1: Infosys shares fell on Thursday after it received a GST notice citing an alleged Rs 32,000 crore tax evasion, a claim that the IT major has disputed. Infosys shares that opened at Rs 1,850 were trading 0.5-1 per cent low. The company’s share has gained more than 20 per cent since January this year.

Reports earlier claimed on Wednesday, citing Directorate General of GST Intelligence, that Infosys is “liable to pay IGST under reverse charge mechanism on supplies received from branches located outside India to the tune of Rs 32,403.46 crore for the period 2017-18 (July 2017 onwards) to 2021-22.” The company denied this in a late evening stock exchange filing. Infosys Accused of Evading Over INR 32,000 Crore GST, Probe Underway: Report.

“Karnataka State GST authorities have issued a pre-show cause notice for payment of GST of Rs 32,403 crore for the period July 2017 to March 2022 towards the expenses incurred by overseas branch offices of Infosys Limited,” said the company in the filing. The company responded to the pre-show cause notice.

Infosys also received a pre-show cause notice from the Director General of GST Intelligence on the same matter and “is in the process of responding to the same”. “The company believes that as per regulations, GST is not applicable on these expenses. Infosys’ Full-Year Employee Strength Drops for First Time in 23 Years by 25,994 in Financial Year 2023-24.

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,” said Infosys. Infosys said it has paid all its GST dues and is fully in compliance with the central and state regulations on this matter.

(The above story first appeared on LatestLY on Aug 01, 2024 01:56 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).