Regarding demand notice from IT Department

If you don't want any hassle and if you have received the salary amount it's better to pay such tax for now and later when the company pays the TDS you can revise the return and claim refund of same.

As you don't have Form 16 it would be really difficult to prove before the income tax authorities that such TDS was deducted and going into appeal for such matter won't be feasible.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you

Hi,

Hope you are doing well !!

1. It is advisable to pay the outstanding demand and revise the return later.

2. & 3. If the person to whom the section 156 tax notice for demand has been issued fails to pay the amount demanded within the time limit, then the assessee is liable for the following penalties:

• Interest u/s 220- Interest at the rate of 1 percent each month or part thereof is payable after the expiry of the 30 days time provided under section 156 tax notice.
• Penalty u/s 221- A penalty u/s 221 may be imposed by the assessing officer on the assessee but it should not be more than amount demanded in demand notice.
  
  
   

Yes you can do that but the best proof would be Form 16, without that at first your claim wont be accepted and it can lead to litigation.

If you dont pay it now a demand would be raised in your name u/s 143(1) and then you'll have to pay it. Charging of interest would depend on your total salary and TDS.

I would advice you to pay tax now and later when company pays your TDS claim it as refund.

Dear Sir,

Here is my reply to your query:

1. You can respond to the intimation on the income tax portal. After login you can click on the pending demands and response to the query that whether you "agree", "disagree", "partially agree". Once you respond to the query your return will be reprocessed accordingly.

In your case, as you mentioned that company haven't deposited the tax and you have claimed the same in your income tax return, you choose any of the following option:

Option 1 : Pay the demand with interest at the rate of 1% per month. In this case whenever company will deposit the TDS, you can again revise the return and can claim the refund of that amount. Ultimately amount paid as interest will be loss on your part.

Option 2 : Don't make the payment and wait until the company pays the TDS. In this case once the company will pay the TDS, demand will be removed from the portal automatically or you have to just respond to reprocess the return. 

2. I will stand on the income tax portal and you will receive reminders.

3. Interest will be charged on continuous basis @ 1% pm from the due date of payment.

Thanks and Regards 

Divya Chugh 

Thankd  

Dear Sir,

In this case, you need not pay any tax.

Once the tax is deducted at source on a payment by the payer, then the tax on such payment cannot be recovered from the recipient. In this regard, attention is invited to section 205 of the Income Tax Act, 1961, which states as under:

"205. Where tax is deductible at the source under the foregoing provisions of this Chapter, the assessee shall not be called upon to pay the tax himself to the extent to which tax has been deducted from that income."

Attention is also drawn to the decision of Hon'ble Bombay High Court in the case of Yashpal Sahni v. ACIT: [2007] 165 TAXMAN 144, wherein, the Bombay High Court has categorically held that if the employer has deducted tax at source, then the tax on salary cannot be recovered from the employee even if the employer has not deposited the tax to the Government. Similar view has been taken by the Hon'ble Gujarat High Court in the recent case of Devarsh Pravinbhai Patel v. ACIT: SCA No. 12965 of 2018.

Thus no tax liability arises in your hands.

You may book a consultation to get detailed advice on future course of action.

If you find the answer useful, you are requested to kindly provide an appropriate rating to it.

Thanks and regards,

CA Yogesh Malpani

- Wait for the prosecution against the company for non-deposit of TDS and non-filing of TDS returns.

Hello,

You are not required to pay tax since the default is made by the deductor.

No interest would be charged from you if you have filed your original return within due date and you have sufficient proofs of TDS deduction. The defaulting deductor would be required to pay interest on delayed payment of TDS to the Government.

I hope that this answer satisfies your requirements.

Regards,

CA Hunny Badlani

Salary Slips with TDS deduction, bank statements or any other documents in this regard would be required to be preserved by you as proof.

Hi,

Salary slips with company stamp and Full and Final Settlement letter can be treated as TDS proof but it is subject to litigation