Income tax department has unveiled a new scam of more than ₹3200 Crore. Just after few weeks of the multi-billion scam of Punjab National Bank which shook the nation, now there is TDS Scam. TDS (Tax Deducted at Source) wing of Income tax department could notice the wrongdoings of 447 companies, in verification survey carried out from April 2017 to March 2018.
There are 447 Companies, said to be involved in the matter. Media reports suggest that most of them are Builders, however no official confirmation provided.
What is the TDS Scam?
Companies are supposed to deduct income tax in form of TDS (tax deducted at source) from the salaries of employees. The collected TDS need to be deposited to Income Tax Department either quarterly or monthly. In the Scam, the companies had collected the TDS from their employees but did not deposit to the government. They diverted fund to their business or some other ventures.
The action was taken so far
The TDS wing of Income Tax department has initiated the prosecution under IPC section 276 B. There is a provision of 3 months to 7 years rigorous imprisonment along with fine, in the mentioned section. Media reports suggest that few warrants also have been issued.
Will it affect the employees?
Yes, the employees of the companies will be affected. They might be filing income tax returns, accounting the TDS collected by their companies but as the amount is not deposited, there will be a gap in the calculation. The income tax portal may be showing the tax demand. The Tax demand must not be ignored. Till the time of alternate resolution, if any, the employees need to pay their dues which will increase the burden on them.
Employees of Other companies need to be cautious.
It is strongly recommended to check regularly form 26AS which clearly mentions the tax deposited by companies on behalf of the employees. Form 26AS can be seen on Income Tax return filing website or through Saving bank account (online).