Mahindra Satyam, which has recently restated its accounts for seven years that mired in financial fraud, has decided not to contest the notice sent by the Income-Tax Department that called for special audit of the accounts.
“We have received the communication from the Department (regarding special audit) and decided not to contest. We have started responding to queries (from the Department) as and when we get them,” sources in Mahindra Satyam told Business Line .
“We are not assigning much significance to it because we are confident of our rigorous audit process that went studiously into the financial mess that the erstwhile management left us in. We are providing whatever information the tax authorities is asking for,” the sources said.
The IT Department had invoked Section 142 (2A) of the IT Act and called for re-audit of the numbers for the financial years 2002-03 and 2007-08. The restatement by the new management in November 2010 noticed fictitious tax payments worth Rs 300 crore and unrecorded tax payments/ refunds to the tune of Rs 50 crore.
Qatar contract
Meanwhile, Mahindra Satyam has won a Rs 75-crore contract from a sports academy in Qatar for the management of its information technology infrastructure. “An old client in Qatar came back to our Media and Telecom vertical. This is a result of our recent success in the FIFA in Africa,” the sources said.
“This is a long-term engagement,” they added.
Results on Feb 14
The company would announce the results for the third quarter ended December 31, 2010, on February 14. The scam-hit company cleansed its accounts for the questionable period under its founder Mr B. Ramalinga Raju's regime and became “current” in November 15, 2010, as per the Indian accounting standards.