880 Crore income in Quess Corp (From PTI)
The Income Tax Department has alleged “concealment” of Rs 880 crore income after it surveyed a a leading manpower service providing company in Bengaluru.
The company, Quess Corp Limited, has refuted the charge, saying it was extending full cooperation to the department and that it has not received any claims to date.
The survey operation was launched on July 8 at two premises of the company in the capital city of Karnataka.
“The assessee has been claiming huge deduction under section 80JJAA of the Income-tax Act, 1961 which incentivises new employment generation, subject to fulfilment of certain conditions such as emoluments paid to the employee which should be less than Rs 25,000 per month and number of days of employment etc,” the CBDT had said in a statement issued here on Tuesday.
“Overall, the survey has resulted in detection of concealment of income to the tune of Rs 880 crore spread over various assessment years,” it claimed.
The Central Board of Direct Taxes (CBDT) frames policy for the tax department.
When sought a response, a company spokesperson provided to PTI its statement filed before the stock exchange on Wednesday in connection with the survey conducted against it and its subsidiary, Terrier Security Services.
“The queries raised to date by the Income Tax department are interpretational in nature.While we await further communication, will continue to cooperate with them even as we stand committed to vigorously defending our interpretation using all recourse available to us,” the company said.
Quess Corp said it is at the forefront of employment generation in the formalised sector, with over 3,63,000 employees on its rolls.
“As a responsible entity, we observe all auditing and accounting requirements and continue to be a 100 per cent compliant tax payer.”
“The company paid a total of Rs 2,900 crore in tax and statutory contributions to the government in financial year 2021, which represents 12 times the company’s normalized profit for the year, or 26 per cent of its revenue,” it said.
The statement said the company maintains a scrupulous record of its financial dealings, and contributes towards nation-building as a responsible business.
“Our claims under section 80JJAA are entirely in line with the letter, spirit and intent of the law, and aligned with prevailing industry practices. We further refute any allegations of ‘concealment’ of income,” the company said.
The CBDT said the survey operation found that “even though the emoluments of new employees added were more than Rs 25,000 per month, the assessee has been wrongfully claiming deduction under section 80JJAA by excluding certain components of emoluments of such employees to fit into the eligible emoluments limit
Zomato IPO Day 1
On July 14, the first day of bidding, Zomato’s initial public offering, one of the major food service platforms in India, was subscribed 1.05 times.
According to subscription data accessible on markets, the offer attracted bids for 75.60 crore equity shares, compared to the IPO’s target size of 71.92 crore equity shares.
Retail investors are leading the charge, as their reserved portion has been subscribed 2.69 times, while non-institutional investors have bid for 13% of their reserved portion.
The component reserved for employees is subscribed at 18%, while the amount reserved for qualified institutional purchasers is subscribed at 98 percent.
On July 13, a day before the sale opened, it had already raised Rs 4,196.51 crore from 186 anchor investors. The size of the initial public offering has been lowered to Rs 5,178.49 crore from Rs 9,375 crore previously.
The IPO consists of a fresh issue by the firm of Rs 9,000 crore and an offer for sale by the company’s current largest shareholder, Info Edge, of Rs 375 crore. The offer price band has been set at Rs 72-76 per equity share.
The meal delivery firm intends to use the funds from the fresh issuance to fund organic and inorganic growth projects totaling Rs 6,750 crore, as well as general business objectives.
Zomato’s technological platform connects customers, restaurant partners, and delivery partners, enabling them to meet a variety of demands. Zomato’s B2C solutions include food delivery and dining out, as well as the B2B option Hyperpure. Another significant aspect of the business is Zomato Pro, which is the company’s customer reward programme, which covers both meal delivery and dining out.
Zomato was present in 525 cities across India as of March 2021, with 3,89,932 active restaurant listings and a presence in 23 countries beyond India.
“While the IPO is expected to generate significant interest due to the company’s uniqueness, size of the opportunity, and some evidence of scale economies, the valuations appear extremely high on conventional metrics at 25x FY21 EV/sales, compared to 10x for global peers and 12x for Indian quick service restaurants (QSRs), with the path to profitability also unclear,” said Yes Securities, which advised investors.
“While the current frenzy should result in some listing gains,” the brokerage added, “we would like to see more clarity on capital allocation strategies, competition activity, and unit economics over the next several months before providing a more nuanced fundamental perspective on the company.”
Infosys, the country’s second largest provider of software services, posted a consolidated net profit of Rs 5,195 crore for the quarter ended June 2021, up 2.3 percent sequentially. However, the business boosted its full-year revenue growth projection to 14-16 percent in constant currency terms from 12-14 percent previously.
Additionally, it maintained its full-year EBIT margin target of 22-24%.
Consolidated sales increased 6% quarter on quarter (QoQ) to Rs 27,896 crore and the topline increased 4.7 percent sequentially to $3,782 million, exceeding CNBC-TV18 poll predictions of Rs 27,718 crore and $3,758 million, respectively. Constant currency revenue increase was 4.8 percent QoQ, exceeding estimates of 3.5 percent.
Dollar revenue increased by 21.2 percent year over year in Q1FY22, while constant currency revenue increased by 16.9 percent, reflecting substantially broad-based growth.
“Driven by the dedication of employees and the trust of clients, we grew at the fastest pace in Q1 in a decade, at 16.9 percent year-on-year and 4.8 percent quarter-on-quarter in constant currency,” said Salil Parekh, CEO and MD at Infosys.
He further said,”I am proud of employees, who as ‘One Infosys’ demonstrate resilience and commitment in delivering for clients. This
gives confidence to increase revenue growth guidance to 14-16 percent.”
“We remain confident of delivering on the margin guidance, underpinned by our comprehensive cost optimization program, despite increasing cost headwinds arising largely from compensation review, talent acquisition and retention,” said Nilanjan Roy, Chief Financial Officer.