Paradise papers :Congnizant technologies setup company in Isle of Man

New Delhi Nov 10: The International Consortium of Investigative Journalists (ICIJ) has once brought out paradise papers - the documents to shun the light on offshore entities.

The documents reveal that how Cognizant Technology Solutions Corporation, has set up offshore entities in Isle of Man in 2010.

The Global IT Major set up a company CTS Isle of Man (CTS IoM), to provide service to Lloyds TSB, a British bank with branches across England and Wales, in the Isle of Man and implement a new platform.The company set up offshore entities was to bring a team of up to five people to the Isle of Man to deliver a project for Lloyds TSB.

However, the company has decided to wind up the company registered because this entity has not been generating revenues and has only incurred some minor expenses in 2011.

For setting up the company in the Isle of Man, the group decided to go via an intermediate subsidiary CTS Luxembourg — the ultimate parent company is CTS Corp, Delaware in the United States.

Documents reveal that in the winding-up process, the company effectively did not manage to pay its dues of GBP29,000, which had to be written off by its intermediate parent CTS Luxembourg in
order to complete the winding up of CTS Isle of Man.

Cognizant Response

A Cognizant spokesperson said "As a multinational firm, we establish appropriate legal structures in countries where we service our clients, in compliance with local laws and regulations. These structures are liquidated when they are no longer required. For business and
competitive reasons, we are not able to discuss details about specific client engagements."