In a recent development, the Karnataka GST authority has withdrawn the pre-show cause notice previously issued to Infosys, which involved a substantial claim of ₹32,403 crore for services rendered by the company’s overseas branches.
Key Points:
- Background: The initial notice, issued for the period from July 2017 to March 2022, demanded GST payment of ₹32,403 crore for services provided by Infosys’ overseas branches. Infosys contended that GST was not applicable on these expenses.
- Withdrawal of Notice: The Karnataka State GST authority has now withdrawn this pre-show cause notice, relieving the company from the immediate pressure of the claim.
- Next Steps: Infosys is directed to submit a response to the Directorate General of GST Intelligence (DGGI), the central GST authority, to address the issue further.
- Company’s Position: Infosys has maintained that the GST charge does not apply to the mentioned expenses and had previously responded to the pre-show cause notice in an attempt to clarify their position.
Overview of the Situation
- Previous Notice: The original pre-show cause notice was a significant step in a process that could have led to substantial financial implications for Infosys.
- Current Status: With the withdrawal of the notice by the Karnataka GST authority, Infosys now shifts its focus to resolving the matter with the DGGI.
The Company has received a communication from Karnataka State authorities, withdrawing the pre-show cause notice and has directed the Company to submit further response to DGGI central authority on this matter – Infosys (exchange filing).
