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Wrong deduction made by employer

Mistavddre (-) (91 Points)

13 September 2014

A doctor gets his monthly salary from a hospital. But during a month, the hospital made a mistake while entering salary amount in TRACES website and thus even TDS amount is wrong.

Instead of disclosing that the doctor's salary is Rs.30000, they have mentioned it as Rs.15000 and thus even TDS amount is also wrong.

My question is what action can the doctor take against the employer. Is there any interest/penalty for not paying the correct amount to the government? What are the applicable sections/references?

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3 Replies

CA Prashant Gupta (DGM (F & A)) (14068 Points)
Replied 13 September 2014

first of all, I think you are in hurry for taking action against hospital.

you said that while submitting TDS return, they have made mistake.

you didn't tell that while deduction of TDS from salary is wrong or not.

for mistake, hospital can revise TDS return.

doctor must go to hospital and tell mistake. if hospital is not revising return then he can take action like complain to ITO for this.

Mistavddre (-) (91 Points)
Replied 13 September 2014

what if the employer fails to do so.. will the government impose any penalty/Interest... which sections are attracted for this case....

Ajeet Singh (Service ) (190 Points)
Replied 13 September 2014

The following chart indicates the nature of default and its consequences which range from penal interest, penalty to prosecution:

TDS Defaults2.png

In addition to the above, there are other consequences in certain cases, as enumerated below;

▬ Disallowance of specified expenditure (while computing the income of the deductor) if TDS is not deducted from the payment. (Section 40a(ia)).

▬ Where the tax has not been paid after its deduction it shall be charge on the asset of the defaulter to recover the amount of TDS. (section 201(2)).