Short deduction of tds

Sir,

One of my friend, A principal of a college have filed the 24Q - Q4 for the financial year 2014-15 in May 2015. In this he has actualy deducted less than the due amount from some employee by mistake. So a demand is shown in TRACE for short deduction. Now please advise me if he can deduct the due amount from these employees in subsequent payment in this june and deposit it and file a revised return for Q4. Secondly if He is  not deductiong this short amount but the employees are filing the IT return as per his salary statement and paying the tax themselves than will the employer be free from his responsibility ? So need an urgent help. Thanks

Replies (5)

1. "if he can deduct the due amount from these employees in subsequent payment in this june and deposit it and file a revised return for Q4. "

Yes,192(3) allows adjustment of amount of tax deduction and do remember the interest.

 

2. "if He is  not deductiong this short amount but the employees are filing the IT return as per his salary statement and paying the tax themselves than will the employer be free from his responsibility."

 [Easy route]

S. 192 Mandates deduction of tax while paying the salary, employees can claim the refund of self assessment tax paid (if any)

BUT

Several high Court judgements have held that if the assessee has himself paid the tax on the income on which tax was required to be deducted then taxing authorities can not once again recover that amount from the deductor.

Therefore there should be no requirement to deduct tax, there is also a case wherein penalty u/s 271C was also removed by the court for short deduction

Also see Tej Quebecor Printing Ltd V JCIT 2003 84 ITD 685 Del

 

Hindustan Coca Cola Beverages P Ltd. V CIT 2007 SC

Thanks sir, Thanks a lot but I am very very sorry for my delay. Actualy your suggestion is very helpful for my  friend.

Wait a sec

192(3) allows adjustment for within a financial year

Employee should himself offer the tax or employee should give money to the employer then employer will pay it to the CG

Please go through the link below. It might help

https://abcaus.in/incometax/assessee-in-default/ca-certificate-27ba-26a-failure-to-deduct-collect-pay.H T M L

Therefore, if your employee has condidered the entire salary correctly and paid the tax accordingly, all you need is a CA certificate in form 26A to that effect.

Thank you Sirs, for your usefull advice.

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