22 June 2023
Dear Sir/Madam, My query is my client has done some construction work of a company and despite sending so many mails that party is not responding for confirmation as regards the work shown in his books of accounts for some particular month. Is there any other way through which we can find out how much work is booked by them ....our client has already issued bills but they are not aware whether that party has shown it in their accounts or not and they have deducted tds while making payment but its not shown in 26AS ...what can be done as regards both the things....they are giving so much trouble to my client. Kindly respond at the earliest.
10 July 2024
Dealing with a situation where your client has performed construction work for a company, issued bills, but is unsure if the company has accounted for the work in their books or properly reflected it in TDS (Tax Deducted at Source) can indeed be challenging. Here’s a structured approach you can take to address these issues:
### 1. Verification of Work Booked by the Company:
Since your client has already sent multiple emails requesting confirmation from the company without success, consider the following steps to verify the work booked by the company:
- **Phone Call or Meeting**: Try contacting the company's accounts department or the person responsible directly via phone. A direct conversation can sometimes yield better results than emails.
- **Letter of Confirmation**: Send a formal letter via registered post requesting confirmation of the work booked by them and the TDS deducted. This creates a paper trail that can be useful if legal actions are necessary later on.
- **Legal Notice**: If the company continues to ignore requests, consider sending a legal notice through a lawyer. This often compels the recipient to respond seriously.
- **Audit or Independent Verification**: If feasible, propose an audit or independent verification of the company's records. This could be done mutually or through a third-party auditor to ensure transparency.
### 2. Verification of TDS Deducted:
If the TDS deducted by the company is not reflecting in Form 26AS of your client, it’s crucial to address this issue promptly:
- **Request for TDS Certificate**: Your client should request a TDS certificate (Form 16A) from the company for the amount deducted. This document confirms the TDS deduction and can be used for claiming credit.
- **Rectification Request**: If the TDS is not reflecting in Form 26AS, the company may need to rectify their TDS return with correct PAN details of your client. Your client can communicate this requirement clearly to the company.
- **Follow Up with Tax Authorities**: If the TDS deduction remains unresolved, your client may need to follow up with the Income Tax Department for assistance in rectifying Form 26AS.
### 3. Legal Recourse:
If all attempts to resolve the matter amicably fail, your client may consider legal action for non-payment or incorrect TDS deduction. This typically involves engaging a lawyer to send legal notices and potentially filing a case in a civil court or approaching appropriate authorities.
### Documentation and Record Keeping:
Throughout this process, ensure thorough documentation of all communications, invoices, bills, emails, letters, and any other relevant documents. This documentation will be crucial if the matter escalates to legal proceedings.
### Conclusion:
Navigating disputes related to non-payment, TDS deduction, and accounting for services rendered can be complex. It requires persistence, clear communication, and sometimes legal intervention to resolve. Encourage your client to maintain professionalism and seek expert advice from a lawyer or tax consultant as needed to protect their interests effectively.
CAclubindia
