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Mastek Ltd Faces ₹123.58 Crore Tax Addition, Plans Appeal
Total Tax Addition: ₹123.58 croreOrder Receipt Date: May 30, 2026 Reader Takeaway: Tax assessment dispute noted; company disputes figures and plans appeal. ## What just happened Mastek Limited has received a final assessment order from the Income Tax Department for the fiscal year 2022-23. The order includes additions to the company's income totaling ₹123.58 crore. ## Why this matters This development is significant for investors as it represents a potential financial liability, though the company disputes the assessment. The outcome of the appeal process will determine the actual financial impact. ## The backstory The Income Tax Department's assessment includes a ₹90.95 crore addition related to transfer pricing and ₹32.63 crore under domestic tax laws. Mastek believes the order contains calculation errors, such as an incorrect tax rate, failure to allow foreign tax credit, and not granting credit for advance tax paid by a subsidiary. ## What changes now Mastek plans to file objections with the Income Tax Appellate Authorities. The company stated it does not anticipate any material financial impact currently, as they intend to contest the order. ## Risks to watch The Income Tax Department has initiated penalty proceedings under Section 270A of the Income Tax Act, 1961. The outcome of these proceedings is a key area for investors to monitor. ## Peer comparison Tax assessments and disputes are common in the IT sector. Companies often engage in appeals when they disagree with departmental computations. The materiality of the addition for Mastek will be assessed against its financials. ## Context metrics (time-bound) The order was received on May 30, 2026, which was a weekend. The disclosure was made after the BSE sought clarification on the filing timeline, with Mastek explaining the delay was due to the need for detailed review and verification. ## What to track next Investors should monitor the progress of Mastek's appeal with the Income Tax Appellate Authorities and any updates on the penalty proceedings under Section 270A.