The Bombay High Court has recently ruled that employees cannot be penalized for the employer’s failure to comply with deposit tax deducted (TDS) of salary.
“The object and purpose behind the provision is to the effect that when the obligation to deposit the tax, as in the present case, falls on the employer and if the employer has defaulted, the obligation to pay said tax cannot be transferred to be tax on the employee,” the Bombay High Court said in a recent order.
It is worth remembering that TCS employees received income tax notices about discrepancies in your TDS. Several employees received income tax notices due to discrepancies between the TDS credit in their Form 26AS, Annual Information Return (AIS) and the amount they claimed while filing their income tax return.
So how does it affect employees whose income tax is deducted as TDS by the employer and is supposed to be deposited in the income tax department?
Follow these steps to access Form 26AS
1. If you are an employee, you can check the tax deduction in 26AS, which shows the monthly tax deduction. This way, you can check if your employer is depositing the tax that appears on your payroll.
2. Even during the year, you can check the tax deduction as shown in your annual tax return (or 26AS), whether TDS has been deducted or not.
3. To consult your 26AS model, you can follow the following steps:
Yo). Visit the income tax e-filing website.
ii). Log in to the website by entering the login ID and password.
iii). Once you are logged in, you can go to the blue ribbon and e-file and clock to access the drop-down menu.
iv). Click on “Income Tax Returns”, go to the drop-down menu and click on “view form 26AS”.
v). This will take you to another link that opens as a separate window.
vi). Now you need to click on “View tax credit (Form 26AS/Annual Tax Return)”.
Here you can access the tax deposited by the employer in the income tax department.
Pratibha Goel, Chartered Accountant and Partner at Delhi-based PD Gupta & Company, says, “Employees should ensure that the TDS deducted by the employer is reflected in their Form 26AS and obtain Form 16 from the employer. However, if the Employer has deducted TDS and does not deposit the same, the Income Tax Department will not give its credit during ITR Processing. Here the employee is required to give a reply to the demand notice issued by the department. submission of documents like salary slips and bank entries to show deduction of TDS In the past, high courts have upheld claims by employees where the employer has deducted but not deposited Income Tax instruction number 275/29/. 2014. dated June 1, 2015 also comes to the rescue as it says: “The assessee does not suffer any inconvenience due to non-deposit of tax in the Government account by the deductor.”
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