Slight Dip In Infosys Stock As Massive GST Notice Is Contested By Tech Bellwether

Infosys shares were in focus on Aug 1 after the second-largest domestic IT firm received a pre-show cause notice from Karnataka State GST authorities and the Directorate General of GST Intelligence (DGGI) for a GST payment of ₹32,403 crore. This amount is for the July 2017-March 2022 period towards expenses incurred by Infosys' overseas branch offices. In stock exchange filings, Infosys said it has responded to the pre-show cause notice. "Subsequent to the publication of the news articles, the company has also received a pre-show cause notice from Director General of GST Intelligence on the same matter and the company is in the process of responding to the same," Infosys said. Infosys said it believes GST is not applicable on expenses incurred by overseas branch offices. 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 entity are not subject to GST, the Salil Parekh-led firm said.