Cognizant to deposit $75 mn in suspense account after tax demand dispute

The dispute involves the I-T Department's recent assertion that the company owes additional taxes in connection with a $2.8-billion share buyback transaction undertaken by a subsidiary in 2016

IT major Cognizant has said that it will deposit $75 million (Rs 4.9 billion), representing 15 per cent of the disputed tax demand from the Income Tax Department, to be kept in a suspense account. The remaining amount would be marked under line. It has said that despite the department attaching its bank accounts, its operations remain unaffected.

On Tuesday, a single judge of the Madras High Court granted an interim stay on the I-T Department's proceedings, subject to the condition that the company pays 15 per cent of the tax demand and furnishes a bank guarantee or security by