TCS and Infosys, Both under the Scan of Income Tax Department

In recent past, Tata Consultancy Services who is known to be the biggest rival of Wipro and Infosys was heard to be under the scanner of taxman for something what is often called “body shopping”.

But according to TCS chairman Mr. Ratan Tata, they have not received any communication in regard to forking out of additional taxes from the country's Income-Tax Department.

On Friday during the 16th annual general meeting of the company, he told his shareholders “We have not received any such notice…there have not been any allegations of body shopping. You have nothing to be concerned about”.

At the same time, in separate communications to various other companies, the Department had refused to concede onshore services as software exports. This way they have made them ineligible for tax benefits. Onshore services are actually those services that are rendered by Indian staff on deputation to overseas markets.

Besides TCS for claiming tax exemption on onshore services, Infosys has been also penalized with a fine of Rs 450 crore.
Another issue that has been plaguing the IT industry currently is in regard of increased visa costs and difficulties that are linked to securing of temporary work permits.