Hindustan Unilever gets tax notice of Rs 962.75 cr over Rs 3k cr GSK deal
FMCG giant Hindustan Unilever has received a tax notice of Rs 962.75 crore, including an interest of Rs 329.33 crore, according to the company’s exchange filing.
The company added that the notice was issued over the non-deduction of tax deducted at source (TDS). This was related to a remittance of Rs 3,045 crore made for the acquisition of India Health Food Drink (HFD) intellectual property rights (IPR) from the GlaxoSmithKline (GSK) Group. The payment was made for the merger of GSK’s India brands with HUL, including Horlicks, Boost, Maltova, and Viva.
Notably, the tax demand was raised by the office of the Deputy Commissioner of Income Tax, Mumbai, through a letter on August 23. However, the company has said that the tax demand does not expect any significant financial implications at this stage.
“The company has a strong case on merits on tax not withheld, basis available judicial precedents, which have held that the situs of an intangible asset is linked to the situs of the owner of the intangible asset and hence, income arising on sale of such intangible assets are not subject to tax in India,” said HUL.
