Infosys Secures Major Win as DGGI Closes Rs 32,403 Crore GST Demand Notice

In a major victory for IT giant Infosys, the Directorate General of GST Intelligence (DGGI) has closed a massive pre-show cause notice inquiry that involved a potential GST demand of Rs 32,403 crore. This inquiry was related to services procured by Infosys from its own overseas branches between July 2017 and March 2022. The tax authorities had initially posited that these intra-company services should be treated as "imported services" and be subject to GST under the Reverse Charge Mechanism. However, Infosys successfully argued that, according to GST law, services between a company's domestic office and its foreign branches are not considered imports and are therefore not liable for GST. The DGGI's decision to drop the proceedings provides immense relief to Infosys, removing a significant financial uncertainty and setting a crucial precedent for other multinational corporations with similar operational structures in India.