LTIMindtree Limited, formerly known as Larsen & Toubro Infotech Limited, has recently disclosed a significant legal development regarding its ongoing tax disputes. On August 27, 2024, the company communicated with the National Stock Exchange of India and the Bombay Stock Exchange to inform stakeholders about a new Show Cause Notice it received from the Department of Goods and Service Tax in Bengaluru.
This notice pertains to allegations of non-payment of Integrated Goods and Services Tax (IGST) on export turnover for services provided to clients abroad. In response, LTIMindtree has filed a writ petition with the Hon’ble High Court of Karnataka, challenging the legality and validity of the notice issued under Section 74 of the CGST Act.
The writ petition was heard on the same day, and the High Court granted a stay on the proceedings related to the Show Cause Notice, pending further hearings. This development is crucial for LTIMindtree as it navigates the complexities of tax compliance and regulatory scrutiny.
In its disclosure, the company expressed optimism regarding the outcome, stating that it does not expect the situation to have a material financial impact. The potential claims associated with the notice amount to INR 378 crore, but based on preliminary assessments and legal advice, LTIMindtree anticipates a favorable resolution.
The company has included an annexure detailing the particulars of the litigation, including the opposing party, which is the Union of India through its Secretary in the Department of Revenue. LTIMindtree’s proactive approach in addressing these legal challenges reflects its commitment to maintaining transparency with investors and regulatory authorities.
As a subsidiary of Larsen & Toubro Limited, LTIMindtree continues to focus on delivering innovative technology solutions while managing the implications of this legal matter. The company remains dedicated to its growth strategy and aims to uphold its reputation in the technology consulting sector.
