– Infosys has received communication from Karnataka State Authorities withdrawing the ‘pre-show cause’ notice regarding a GST claim
– Instead, Infosys has been directed to submit a further response to the Directorate General of GST Intelligence central authority
– Infosys shares were trading 1% lower in early trade on Friday following the update
– Karnataka GST authorities had issued a Rs 32,403 crore notice for services availed by the company from its overseas branches over five years starting in 2017
– Infosys maintains that GST payments are eligible for credit or refund against the export of IT services
– Nasscom has defended Infosys, stating that the tax demand reflects a misunderstanding of the industry’s operating model
– Nasscom argues that GST enforcement authorities have been issuing notices for remittance by Indian head offices to their foreign branches where there is no actual service between the head office and the foreign branch