You are here: Home » PTI Stories » National » News
Business Standard

Company director sent to 6 months jail for TDS default

Law Crime

Press Trust of India  |  New Delhi 

A court here has sentenced the director of a real estate firm to six months of rigorous imprisonment (RI) for allegedly failing to deposit over Rs 50 lakh TDS in time to the Income Tax Department.

A senior official of the department said the director of the firm, engaged in building construction services, has been convicted recently by the court as his firm "committed default in timely deposit of tax deducted at source (TDS) of Rs 50,61, 876".

"The company and its director have been asked to pay a fine of Rs 1 lakh each and the director has been sentenced to RI of six months," he said.

The official did not disclose the identity of the executive or his firm.

The man and the company have been charged under IT Act's sections 276B (failure to deduct and pay tax) along with section 278B (offences by companies).

The court, the official said, observed that the offence under section 276B is "complete" when TDS is not deposited on time and a company cannot be allowed to take unfair advantage and use the tax amount so deducted for any other purposes.

In a similar case of TDS default, an executive of an advertising company based here has been sent to jail for non-compliance of the law, he said.

The tax department has, in the recent past, stepped up enforcement and prosecution action against TDS default cases as this category of revenue contributes to over 43 per cent of the total direct taxes collection in the country.

"In Delhi, the TDS wing of the department has launched more than 150 prosecution proceedings against defaulters during the April-July period.

"We have, in this region, the highest number of compounding applications in India from the TDS defaulters who have opted to compound their offence by paying additional penalty in order to avoid impending prosecution proceedings," Principal Chief Commissioner S S Rathore said.

As per rules, the TDS has to be paid to the credit of the central government (IT Department) within seven days from the end of the month in which the deduction is made.

The section 278B of the IT law allows for an imprisonment of the defaulter or the nominated TDS deducting officer for a maximum of 7 years.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Wed, August 29 2018. 19:30 IST