I-T dept serves Rs 138 cr tax notice on Redington

The tax demand relates to "imputed profit" on transfer of its 100% shareholding in Redington Gulf FZE by the company

The I-T Department has served Rs 138-crore tax demand notice on IT and telecom product distribution firm Redington (India) Ltd.

The tax demand relates to "imputed profit" on transfer of its 100% shareholding in Redington Gulf FZE (RGF) by the company to a step down wholly-owned subsidiary Redington International (Holdings) Limited in 2008-09, Redington (India) said in a filing with BSE.

"While transferring the aforesaid investment without consideration, the company took cognizance of the applicable laws and regulatory approvals and transaction was executed after taking legal and accounting opinions," the filing said.

"Based on the directive of the transfer pricing offer, the Assessing Officer is now proposing to bring taxation, the imputed profits on transfer shares to RIHL (Redington International) leading to a potential demand of Rs 138 crore, excluding interest," it said.

Redington is a distributor of IT and telecom product companies like Samsung, Apple, BlackBerry, Dell and BenQ, among others.

Shares of the company today closed marginally up at Rs 81 apiece on BSE.