A service receiver has not deposited TDS. I know u/s 271C, the person failing to deposit TDS will be liable to pay simple interest @ 12 % o.s till the date of actual deposit.
But now, in order to file company returns before 30th September, we are suppose to pay tax because TDS has not been deposited.
Now what do we do? There is no other option but to pay tax from the company's own resources. But what entries to make in the client's ledger and TDS ledger? Can we transfer the TDS balance amount to client ledger account as receiveable from them since we can't show the TDS amount because its not showing in 26AS?
What is wrong in recovering the TDS amount from the client, because they did not deposit the TDS in the Govt, due to which, we had to pay the tax ? In case we recover the undeposited TDS from the client, that means the client has not deducted TDS where the client was liable to deduct TDS, which again creates a violation of TDS rules. What does one do to the TDS receiveable ledger in Books of accounts, wherein the TDS has not be deposited by the client and is unavailable for adjusting with the tax liability?
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