Google India, the Indian arm of the global search engine, is grappling with a Rs 76-crore penalty slapped by the income-tax authorities.
The tax office has said Google India has misled the department, deflated income, violated accounting rules laid down by the chartered accountants' institute and also attempted to show wrong revenues to avoid being subjected to transfer pricing adjustments with respect to its international transactions.
The tax department has refused to keep the penalty in abeyance after listening to the company's explanation and interacting with its auditor, SR Batliboi & Associates, which has offered full support and co-operation in the proceedings.
Google has gone on appeal against the penalty order that relates to assessment year 2008-09. "If the order is upheld, the total advertisement revenue of Google India will be taxed in India," said a person familiar with the case.
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