Gayatri Snehal Rao Vs Income Tax Assessing Officer & Ors. (Gujarat High Court)
In Gayatri Snehal Rao v. Income Tax Assessing Officer & Ors. (Gujarat High Court, 2025), the Court addressed whether the Income Tax Department could raise tax demands against employees when their employer had deducted but failed to deposit Tax Deducted at Source (TDS) with the government. The petitioners, both former employees of Karvy Stock Broking Limited, faced tax demands for Assessment Years (AY) 2020–21 and 2021–22 due to a TDS credit mismatch arising from the employer’s default.
Read SC Judgments in this case:
SC Dismisses SLP as Section 205 Bars Demand on Deductee for Employer’s TDS Default
SC Sets Aside HC Direction to CBDT to Modify Income-Tax Software System
Background and Petitioner’s Case
The petitioners filed writ petitions challenging intimations issued under Section 143(1) of the Income Tax Act, 1961, wherein demands were raised on the ground that TDS shown in their income tax returns was not reflected in Form 26AS because Karvy Stock Broking Limited had not remitted the deducted tax to the government. For instance, the department raised demands of ₹5.13 lakh and ₹27.26 lakh against the petitioners even though their employer had deducted ₹6.13 lakh and ₹32.48 lakh respectively.
