Wipro, India's third biggest software exporter, has been ordered to pay $60m in back taxes.
The 2.6 billion rupee ($59.7m) tax bill came after officials decided the firm was not eligible for certain tax breaks on software profits.
Wipro said in a statement that it would file an appeal against the ruling.
"We have been advised that the demand is not sustainable," local media quoted Wipro company secretary V Ramachandran as saying.
The tax bill comes as Wipro is facing a tougher climate because of a sharp rise in the value of the rupee against the dollar.
The rupee hit its highest level against the dollar for four years on Wednesday, putting export-oriented firms such as Wipro under pressure.
Wipro shares closed 1.6% lower at 1,349 rupees on the Bombay Stock Exchange on Friday.
Bangalore-based Wipro is a software design and IT outsourcing specialist which counts global corporations such as Boeing, General Motors and Sony among its clients.
The firm employs some 27,000 people, and has a stock market listing in New York.