Wipro asked to pay Rs22.50 crore by today

Hearing a petition filed by software giant Wipro, challenging the freezing of its bank account in a case involving the payment of commercial tax, the high court on Tuesday instructed that the company deposit the entire tax amount of Rs22.5 crore levied by the department of commercial tax on its customised software by Wednesday, at the high court’s registry.

Wipro had earlier challenged the levy by the department of commercial tax on its customised software before a single judge, claiming that they could not be classified as ‘goods’. The state had held that the software could indeed be categorised as ‘goods’.

Wipro had submitted that it only undertook development of software at the client site; there was, thus, no ‘sale of goods’ involved.

Wipro sought that the notices issued by the department of commercial tax seeking payment of Rs22.50 crore as tax be quashed.

The court dismissed the petition, and offered the software firm the option of appealing before the joint commissioner, commercial tax, within a fortnight. Since Wipro had not filed any appeal before the joint commissioner even 15 days after the dismissal of the case, the department of commercial tax had frozen its bank account. This action was challenged in court by Wipro.

The court observed that Wipro had violated the high court’s order by not filing an appeal within 15 days.