In a major setback for IT firm Wipro Ltd, the Karnataka High Court has directed the firm to deposit Rs 24 crore in connection with a case pertaining to re-export of software. The HC bench of Justice Venugopala Gowda and justice BV Pinto also declined to provide stay over its appeal against 4% value added tax (VAT) on software re-exported.

The Court had given a deadline to the firm to file an appeal before the appellate authority for commercial taxes by December 24 for tax exemption. The firm had the view that it is paying service tax under the development of software act and it is not subjected to the export tax on the software.

The officials of the firm declined to comment on the matter adding that the matter is sub-judice. Legal experts added that the firm has to pay the amount immediately to avoid further implications.

A tax official said on the condition of anonymity, "The Company failed to submit the statutory H-form to the department for claiming tax exemption."