Mahindra Satyam to go against the I-T dept

Stocks

oi-Monika Nihalani

By Monika Nihalani

Published: Wednesday, August 24, 2011, 12:15 [IST]

Mahindra Satyam, the IT consulting and outsourcing firm received a tax demand of Rs 2,113.42 crore from Income-tax department on Monday for two assessment years 2002-03 and 2007-08, the company mentioned in a filing to the BSE.

Responding to the tax notice, the company has decided to knock the doors of Andhra Pradesh High Court in order to challenge I-T department's penalty.

The draft tax notices from I-T department include the fictitious income wrongly stated by Raju, the company described the move as unfair, claiming that the IT department had arrived upon the tax amount based on “fictional'' income generated during Ramalinga Raju's time, the existence of such income has been confirmed by other central agencies.

“It (draft notice), however, does not exclude fictitious income wrongly offered to tax by the earlier management. The existence of fictitious sales and fictitious interest has even been confirmed by other central agencies," the company said in a filing.

The company had earlier been served a tax notice of Rs617 crore for 2003-09, which is under litigation in the Supreme Court.

Under the directions of the Supreme Court, the company deposited a bank guarantee of Rs 617 crore to the Department against its notice for the same amount for questionable years early this year.

The company has also filed a several writ petitions before the Andhra Pradesh High Court to sought a reassessment of tax filings. These petitions are still pending before the High Court.

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