The AP High Court on Wednesday directed the Mahindra Satyam to pay Rs.350 Cr to the Income Tax department with in seven days and furnish an unconditional bank guarantee for an amount of Rs.267 Cr towards payment of tax.

The Income Tax department has asked the company to pay a tax of Rs.617 Cr as per the incomes shown in the company’s records. The High Court in an earlier order ten days ago imposed a freeze on the bank account of Mahindra Satyam on the request of the Income Tax department. The company was asked not to touch the amount of Rs.1300 Cr lying in its bank account.

Mahindra Satyam has been arguing that these incomes shown in the company records were fictitious and the recorded revenue figures were inflated by its tainted former chairman Ramalinga Raju who is in jail now.

The tax bench of the high court comprising Justice V V S Rao and Justice Ramesh Ranganathan told the company that the freezing of the bank account would be lifted only after payment is made to the Income Tax department.

Income-tax counsel J V Prasad argued that the trial in the Satyam scam case is not yet complete and no one knows whether Raju had siphoned off the real money or had shown the non-existent money on records or whether it was a mix of both. The court postponed further hearing of the case to April 20.