TDS Deducted by employeer not submited to government

This query is : Resolved

Vivek Dutta Mishra (Querist)
Follow

05 March 2009 Hi,

during the financial year 2007-2008, my previous employeer deducted a TDS of Rs 1,24,000 approx. However, they have not yet sumitted the same to IT dept. They have also not issued me Form 16. I have bank statement and salary slip as an evidance. Now My questions are as follows:

1. What is my libality in this case?
2. How can I file my return without Form 16. can I be in problem once I file my return.
3. What happens to the employeer in this case.

Regards,

Ram Avtar Singh

Ram Avtar Singh (Expert)
Follow

06 March 2009 MUMBAI: In the tax season comes some good news. In an important judgment, the Bombay High Court recently held that the income tax department cannot recover tax from an employee, if the employer who had deducted tax at source (TDS) fails to deposit the amount with the government

treasury.

Hearing a petition by Powai resident Yashpal Sahni, a division bench of Justice F I Rebello and Justice J P Devadhar found fault with the I-T department's attempt to recover tax from him. The judges also directed the department to refund Rs 17.89 lakh with interest at the rate of 6% per annum that it had unauthorisedly recovered from Sahni, after his employer Hyderabad-based Lan Eseda Industries Ltd failed to issue him a Form 16 or deposit the TDS with the government.

"The fact that the revenue is unable to recover the tax deducted at source from the person who has deducted such tax would not entitle the revenue to recover the said amount once again from the employee-assessee," said the judges, bringing to a close the seven year legal battle waged by Sahni.

Sahni was appointed as LEIL MD in 1996, on a basic salary of Rs 1.20 lakh. The company deducted TDS of Rs 6.6 lakh for 1996-1997. Sahni's services were terminated in 1997. When Sahni filed his returns for that year he claimed credit for the TDS deducted by the company

Vivek Dutta Mishra

Vivek Dutta Mishra (Querist)
Follow

06 March 2009 Hi,

Thanks. Its a great relief.

But that still leaves the two questions answered:

1. How to file the return?
2. What are the consequences for the Employeer for not submitting the TDS.

Regards,

Vivek Dutta Mishra

Upgrade to CAclubindia Pro. Subscribe Now!

CA Sanjeev Kr Jain

CA Sanjeev Kr Jain (Expert)
Follow

06 March 2009 write letter to the concerned commissioner of your former employer informing that the employer had neither deposited tds nor issued form-16 and send a copy to the deductor.