Delhi HC’s interim relief to Google subsidiary in tax dispute

The Delhi high court has given an interim relief to a Singapore-based subsidiary of Google in its tax dispute with tax authorities in India.

The court has allowed Google Asia Pacific Pte Ltd to receive payments to the tune of Rs 1106.41 crore from Google Cloud India after withholding tax of eight per cent, inclusive of surcharge and cess, for the assessment year 2022-23.

The tax department was asking for ten per cent tax after the company applied for a certificate for paying zero per cent tax.

However, Google Asia Pacific filed a petition in the court that there should not be any withholding tax on its payments from Google Cloud India as it has already subjected itself to a two per cent equalisation levy.

The court’s ruling is an interim measure and it posted the matter for May.

Sandeep Sehgal, partner tax at AKM Global, said,”Such confusion is expected till the time equalisation levy is in place. Google Cloud Services could be considered a fit case for applicability of EL and may not be subject to withholding.”

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor