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Query on TDS

Q. My employer has not remitted the TDS even though the amount was deducted from the professional fees paid to me. Please suggest what I should do?


Answer: Our Expert Chartered Accountant is of this opinion for your question:

You can file the IT Returns showing the TDS and claiming that your tax liability has been discharged to the extent of TDS by employer.

In the absence of Form 16 issued by the employer, you should be able to establish the authenticity of the TDS claim by showing the payslips issued by the employer, Bank statement for the account where your salary has been credited etc.

Income Tax Department may (In most cases, will) call for clarification from the employee.*



* Our opinion is based on the decisions of the Mumbai High Court (Yashpal Sahni Vs ACIT, Mumbai) and Hyderabad High Court. The summary of the decisions is given below:



Where a company deducts Tax at Source (TDS) from the salary payable to an employee, but fails to deposit the said amount into the Government treasury, the Revenue cannot recover the TDS amount with interest from the concerned employee.

Therefore, the Revenue has to recover the said TDS amount with interest and penalty from the employer alone and the Revenue cannot seek to recover the said amount from the employee in view of the specific bar contained under section 205 of the Act.

In  other words, even if the credit of the TDS amount is not available to the employee for want of TDS certificate, the fact that the tax has been deducted at source from salary income of the employee would be sufficient to hold that as per section 205 of the Act, the Revenue cannot recover the TDS amount with interest from the employee once again.



Warm Regards,

For InvestmentYogi by Rekha N S.

The writer is Principal, Agarwal & Italia, Chartered Accountants.  She may be contacted at rekha@agarwalanditalia.com

 

Published Jun 08 2009




Comments

Comments

 

pm said:

from 1st oct.2009 tds rate changed.My query on which rate we have to deducted the TDS as expenses realted to period upto 30.09.09 but the same not credited/paid upto 30.09.09 the same has to be taken as provision as on 30.09.09 but not provided in books

October 1, 2009 3:43 AM
 

Rajesh said:

If We have received one profession bill under 194J, the date mention on the bill is September 2009 only but we book this in October 2009 only. Which rate of TDS we will be deducted ( 11.33% or 10%)

November 2, 2009 4:23 AM
 

Neena Bhatia said:

Tds deducted on Professional fees paid excess. Can excess payment adjusted to next quater year or not. my email id is neena2006@rediffmail.com

December 7, 2009 1:32 AM
 

Anil said:

Its Regarding Launch Hire Charges - I Have Received Bills Towards Launch Hire Charges, Whether TDS Is Applicable > Plz. Advice

December 22, 2009 10:51 PM
 

charan singh said:

Dear Sir,

As we all know that FBT has been abolished w.e.f F.Y.2009-2010. Due to removal of FBT from this F.Y. all benefits (being provided by companies to employees) which were taxable under FBT will now be taxable in the hands of employees. In this reference we have some queries which we would like to clear:

(A) We are reimbursing Petrol expenses to employees against the use of CAR (Provided by company to its employees) which is partly being used for official & partly for personal purpose of employees. Till July-09 (Before the budget) company was paying FBT on this reimbursement as this was covered under the FBT. Now since FBT has been scrapped w.e.f.1st April-2009 so now will these petrol expenses will be covered under the personal IT of employees or still this will be out of tax net of personal IT of employees.

     (B) We are also including Rs.1200/- PM as perquisite in the hands of employees (rule 3 (2) of section 1e7 (2)).

Please clear whether petrol expenses will be exempt in the hands of employees or this will be taxable in the current scenario considering that we are taking Rs.1200/-PM (rule 3 (2)) as perquisite of the individual employees?  

Fixed Reimbursement of telephone (Mobile) expenses on monthly basis to employees. Telephone (Mobile) connection is in the name of individual employees. Will this reimbursement be covered in the tax

     Calculation of the employees?      

Payment of mobile expenses used by employee (as per the bill).Connection is in the name of company. Will this be covered in the tax calculation of the employees?  

Payment of the landline telephone (Provided by company to employee) expenses by company. Will this payment amount will be taken as taxable in the hands of employees.?

Reimbursement of medical expenses (Section 17 (2)) upto Rs.27,500/- to employees. Till now company is giving exemption upto Rs.15,000/- and rest amount was taxable in the hands of employees. After the removal of FBT will this rule will still be applicable or now the entire amount will be taxable in the hands of employees?

December 25, 2009 5:17 AM
 

Bhupesh Patidar said:

We have deducted TDS and paid the amount from time  to time on various date, issue TDS Certitifcate for the F/Y 2007-08. But the Deductee has not received the claim of TDS. They have proceeded to NSDL but it is not being credited.

My question is How do I go ahead? Whom & How shall I contact?

January 1, 2010 11:57 PM
 

M.F.SADIKOT said:

Tds deducted on Professional fees paid excess. Can excess payment adjusted to next quater year or not. my email id is [sadikotmf@rediffmail.com]

January 15, 2010 1:07 AM
 

M.F.SADIKOT said:

Tds deducted on Professional fees paid excess. Can excess payment adjusted to next quater year or not. my email id is [sadikotmf@rediffmail.com]

January 15, 2010 1:07 AM
 

bhavesh said:

i received bill for manpower supply (trainee & engineers) what is tds rate applicable to this party

February 27, 2010 12:01 AM
 

Virender Singh Rana said:

TDS is applicable on payment to government sector/governement undertakings ?

May 15, 2010 5:56 AM

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