K'taka HC grants interim relief to Flipkart in Rs 1,100-cr tax demand case

The assessee (Flipkart) argued that the matter was already decided in its favour by the income-tax appellate tribunal (ITAT) Bengaluru on the same issue earlier during assessment year 2015-16

The Karnataka High Court has granted an interim stay on a tax demand of around Rs 1,100 crore against Flipkart India over issue of capitalisation of marketing intangibles.

The matter pertains to assessment years (AYs) 2016-17 and 2018-19, where the commissioner of income-tax appeals (CIT-A) had capitalised discount as marketing intangibles and disallowed employee stock options (ESOPs) amounting to about Rs 4,500 crore and Rs 180 crore, respectively, for the two assessment years.

In an interim order, the high court directed that no coercive action should be taken against the e-commerce major till February 24 (the next date of hearing).