New Delhi : US-based IT firm Cognizant said it paid all applicable taxes related to its buyback transaction in 2016 and the Indian Income Tax Department’s (ITD) position is “contrary to law and without merit”.
The firm’s comments follow ITD’s freezing its certain bank accounts over a dispute on payment of dividend distribution tax (DDT) running into hundreds of crores. Cognizant said it will “continue to vigorously defend itself and will pursue all available legal remedies”.
In a statement, a spokesperson said the firm’s business operations and its work with clients were “not impacted by actions recently attempted by the Income Tax Department”. The spokespe-rson said the Chennai High Court heard the matter and has instructed the ITD not to take further action pending hearings. “The company believes that the positions taken by the Indian Income Tax Department are contrary to law and without merit. Cognizant has paid all applicable taxes due on the transaction at issue,” it added.