TCS tax liabilities more than double to Rs 8,000 crore in FY16
Country’s largest software services firm Tata Consultancy Services (TCS) saw its tax liabilities more than doubling to Rs 8,148.03 crore in 2015-16 from Rs 3,962.83 in the previous fiscal.business Updated: Jun 14, 2016 21:27 IST
Country’s largest software services firm Tata Consultancy Services (TCS) saw its tax liabilities more than doubling to Rs 8,148.03 crore in 2015-16 from Rs 3,962.83 in the previous fiscal.
According to TCS’ annual report, income tax demands grew to Rs 7,955.14 crore in 2015-16 from Rs 3,901.82 crore in the previous fiscal.
Indirect tax demands also rose over three-fold to Rs 192.89 crore in the said fiscal from Rs 61.01 crore in FY2015.
The software major is scheduled to hold its annual general meeting in Mumbai on June 17 where it will consider and adopt the report along with other financial statements.
The Tata group company had reported nearly 15 per cent growth in its revenues in 2015-16.
In addition to the disputed tax demands, the Mumbai-based firm also listed the Rs 6,227 crore claim by Epic Systems Corp as a contingent liability for the fiscal 2015-16.
When added up, TCS’ total contingent liabilities for the year stood at Rs 15,021.49 crore for 2015-16.
As per accounting norms, a contingent liability is a potential financial obligation that could arise in the future because of certain developments. However, this may or may not result in an actual outgo of money.
In October 2014, Epic had filed a legal claim against TCS in the Court of Western District Madison, Wisconsin for alleged unauthorised download and misuse of Epic’s confidential information and trade secrets.
In April this year, TCS received an unfavorable jury verdict awarding damages totaling Rs 6,227.03 crore to Epic which the trial judge has indicated his intent to reduce.
TCS said it expects to defend itself against the claim and believes that the claim will not sustain.
Among the contingency liabilities, TCS also showed guarantees given by the company on behalf of its subsidiaries. This stood at Rs 3,225.31 crore in the said fiscal.
TCS is scheduled to hold its annual general meeting in Mumbai on June 17.