Mistaken notice

Giant tax demands should not be rushed

A “pre-show cause” notice issued to information-technology (IT) major Infosys by the tax authorities has caused ferment in the markets and beyond. The notice held the company liable for what it said was unpaid amounts of integrated goods and services tax (IGST) on transactions between its offices in India and abroad. The company views this as services delivered to itself. The tax office has chosen to argue that its overseas offices or subsidiaries are independent. The concern in the markets has been enhanced by widespread confusion regarding the exact status of the claim. To begin with, the