Tds paid on accrued, but unpaid salaries

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 September 2014 I have resigned from my Company 2-months back & have not received my outstanding dues on settlement from the Co. This O/s dues includes LTA, Medical exps.and pending salaries for last 20-months, which comes to huge amount. We were getting salaries once in 3-mths.or 4-mths. and therefore, it got piled-up to 20-mths. Since, there is no hope of turn-around of the business in this Co.& our Employer has no intention of giving these dues to me as well as other Employees, who had resigned from the Co., I took the hard decision of resignation after working 22-years with this Company. The Co. has deducted Tds on unpaid LTA as well as unpaid Salaries all these years and PAID to/deposited with Govt.Treasury and accordingly, have issued form-16 for the respective years. On accounting point of view, the Co.has shown Salaries & LTA as expenses and to that extent shown low profit and paid less income-tax on the same. But, if you see employee's point of view then you will realize that he suffered a huge loss as paid unnecessary tax on salary income which was not received by him and almost bad-debts for him to recover from the company. We know that salaried person is liable to pay tax on the basis of accrual or receipt of income, whichever is earlier, but what is the remedy for the salaried class people who have resigned from the Co. & are not getting their dues? Is there any procedure for claiming refund from the ITO for tax paid on salaries which was not received by him? Please advice.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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04 September 2014 You can not claim refund from the ITO for tax paid on salaries which was not received.
By filing return only refund can be claimed. You may not be able to file return since you have not received salary.

Rupesh Jain

Rupesh Jain (Expert)
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04 September 2014 if your income tax is below from TDS deposited , then you can get refund other wise not possible.

for pending salary you may file complain with labour deptt.

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