US retail giant Walmart has submitted to Income Tax authorities its rationale for deducting tax on payments made to some Flipkart shareholders, a senior official said Wednesday.
Income Tax authorities, which had previously asked Walmart to explain the logic behind its tax deductions on the USD 16 billion Flipkart deal, have the option to seek more clarifications from the US retailer once they study the reply.
On September 7, Walmart paid Rs 7,439 crore tax on payments it made to buy out shares of 10 major shareholders of Flipkart but had not done so for another 34 who exited the Indian e-commerce company in the USD 16 billion deal.
As many as 44 shareholders of Flipkart, including significant ones like SoftBank, Naspers, venture fund Accel Partners and eBay, sold their holdings to Walmart.
Individual shareholdings in Flipkart and those who offloaded the stake have not been publicly declared either by the seller or the buyer.
After Walmart deposited Rs 7,439 crore tax, the tax department asked Walmart to explain the rationale followed while deducting or not deducting taxes from Flipkart shareholders.
Walmart has now replied to I-T authorities reasoning out the basis of tax deduction, the official told PTI here. "We are studying their response."
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