1620 crore hit to TCS, the country's largest IT company, fined by the US court

The country's leading IT company Tata Consultancy has suffered a hit of crores. An American court has imposed a fine of crores of rupees on the Tata Group's IT company. The company itself holds this information. In fact, an American court fined TCS 194 million dollars i.e. 1620 crores for misappropriating trade secrets of American IT services firm DXC (earlier known as CSC). The court ordered TCS to pay $56 million in compensation and $112 million in exemplary damages to CSC.

This is how penalties are imposed

According to information provided to stock exchanges by TCS, the penalty imposed on it is over $194.2 million, which includes compensatory damages of $561.5 million, exemplary damages of $112.3 million and prejudgment interest of $25.8 million. The total amount of penalty in Indian currency is approximately Rs. 1,622 crores.

Why was the penalty imposed?

In 2018, TCS won a $2.5 billion deal from US insurer Transamerica. According to this deal, Transamerica's 10 million customers were to be provided with all the facilities on a single platform. The deal was canceled in June last year. The deal was later scrapped citing microeconomic conditions.

TCS will challenge the order

However, the Indian IT company says it has strong grounds to challenge the court's decision. TCS said it will challenge the district court's decision in the appropriate court and file a review petition. TCS said it has received the relevant court order on June 14, 2024.

TCS has started preparations for this

TCS feels that the court's decision to impose a huge penalty will not have any significant financial impact on it. The company is preparing to take necessary steps to protect its interests and face the legal challenges arising from this court order. TCS hopes that after the review petition and challenge, the decision will come in its favour.