Import Of Equipment: DRI Issues Notice To IBM For Rs 620-Crore Unpaid Customs Duties

Directorate of Revenue Intelligence (DRI) has issued a notice to IBM for unpaid customs duties to the tune of Rs 620 crore for equipment imported into India, reports Economic Times (ET).

The investigation, which began in 2014, found that IBM had under-invoiced equipment imports. Two other additional notices have been issued to the US-based technology major, taking the total dues to Rs 900 crore.

International Business Machines (IBM) imports laptops and personal computers for use in its local operations. It also sells servers and mainframe computers to other large businesses like HDFC Bank and Bharti Airtel.

“They (DRI) can say that you have underpriced your equipment by not considering the royalty, technical services or other similar payments to evade customs duty. But it depends on the facts (of the case),” said Amit Maheshwari, partner, Ashok Maheshwary & Associates LLP to ET.

Similar Case In 2013

In 2013, the Income Tax Department (ITD) withdrew a claim of $814 million in taxes against IBM after the High Court of Karnataka accepted a compromise between the department and IBM's Indian unit.

ITD had accused IBM India of failing to provide documentation to back a claim for eligible exports under a tax holiday scheme offered to IT companies.

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