Dear All,
I need an advice on a query related to my situation. In June 2011, I had joined a company with 2 months notice period as separation terms. But finding that the company atmosphere not suitable for me, I left it within a month. I worked for 25 days and informed them ( email communications records available) that I wish to discontinue and never went back. And from 1st July I joined another company.
I did not provide my bank accont details to the prevoius company. So basically, I did not do any transaction with the company.
But recently, I have found out that, the company has shown my two months income (which I did not receive) and TDS in the Income Tax records. which means as per their records, I had worked for 2 months with them.
This results in an increase of my tax liability (as per IT records) and also a scenario of double employment. Although the TDS has been deducted, but now considering it along with my annual income, I need to pay 30% on entire amount - which is much more than the TDS deducted.
When I requested to the company to reverse the entries, they denied saying that they will not reverse and the amount would be considered as - Two Months Notice period buyout amount.
Is the company legally correct in doing this?
Even if the separation terms include paying the full salary for two months, what should happen to the PF amount?
Do I need to pay tax on this amount?
Am I going to face any problem regarding dual employment?
Any other relevant legal/IT related observations/advices you would like to provide in this case.
Regards,
CAclubindia
