Defaulter of Income Tax TDS arrested and sent to jail by the Tis Hazari Court

Tis Hazari Court has ordered judicial custody of the Director of a Delhi based Real Estate and IT Solution Company for non-compliance in Income Tax TDS Default case. It was found during investigations that the company had deducted TDS but had not deposited in the Government account despite there being a statutory obligation by the Income Tax Act. This also led to harassment of many innocent persons whose TDS had been deducted but the TDS returns had not been filed by the Real Estate Company. It was found that during FY 2013-14, FY 2014-15 and FY 2015-16, amounts of Rs. 45,68,990/-, Rs. 35,45,290/- and Rs. 33,36,970/- were deducted by the assessee company. The assessee company was found to be defaulting on filing of TDS return statements.

Taking into account all defaults, show cause notices were served upon the Director to explain why sanction for prosecution should not be granted under section 278B read with 276B of Income Tax Act for not complying with the provisions of the law in respect of non -deposition of the Income Tax deducted at source. However, during the proceedings, the assessee asked for repeated adjournments, instead of giving reasonable explanations for the defaults during the proceedings. Hence, it was concluded that there is no justifiable reason for the delay in depositing the TDS. This clearly showed the non-serious behaviour of the assessee towards the provisions of deduction and depositions of tax at source. Therefore, TDS Wing in exercise of powers under Section 279(1) of Income Tax Act sanctioned the filing of criminal complaint against the company as well as the Director under Section 276B read with 278B, 278E and 279 of the Act for FY 2013-14, FY 2014-15 and FY 2015-16 in 2017.

Non-bailable warrant was issued against the Director in December 2017 for non-compliance with the case proceedings. The Non-bailable warrants returned to the court unexecuted with the report that accused is avoiding execution of the warrants. Hence, on 19 Jan 2018 accused was taken into custody and was remanded to judicial custody. The accused has been sent to Tihar Jail for the same.

The Principle Chief Commissioner of Income Tax – Delhi, Shri.  S. S. Rathore stated that the Department is very serious about timely depositing of the TDS deducted by the employers. It is reiterated that the TDS is Government money which has to be deposited in Treasury on timely basis. Failure to deposit the tax deducted will lead to criminal prosecution with imprisonment from 3 months to 7 years. This year the Principal Chief Commissionerate – New Delhi has sanctioned prosecution in approximately 240 cases which clearly shows the strict attitude of Income Tax Department towards the defaulters.  The Principal Chief Commissioner – Income Tax – New Delhi has given a strong message to non-compliant tax payers that tax defaulters will find it difficult to escape from penalties and prosecutions from vigilant and proactive Income Tax Department and at the same time ensuring Best Taxpayer Friendly Services for the honest and compliant taxpayers.”

Source- PIB

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5 responses to “Defaulter of Income Tax TDS arrested and sent to jail”

  1. CA. SUBHASH CHANDRA PODDER says:

    South India based one private limited company deducted TDS from the Salary amounting to Rs 25000/ from one of relation , but no Tax credit certificate able to furnished by the company . means Tax deducted – and they utilized that money to pay the subsequent month’s salary ( part ) / or with drawn the amount for personal use .

  2. Mohan Karihaloo says:

    I was working in Abhijeet Projects Ltd, Chandwa, Dist: Latehar, jharkhand. The company was owned by Jaiswal Group and Dhindra, ex Cong MP. Their head office was based at Nagpur. The company deducted IT at source as TDS from the employees but the amount was not deposited by them with IT authorities.They sold the company and also did not pay the salaries to their employees for 2 years. Now IT is giving notices to the employees and recovering the tax along with the penalty. The IT dept refuse to listen to the woes of sufferers despite payment proof and salary slips records provided to them

  3. rajiv mangrulkar says:

    In work contract services buisness, keeping in view uneven and unpredictable inflow of funds to eratic and delayed payments for contract works of putblic utility projects of roads from govt agencies, it is requested to central govt ministry that, on lines with provisions of the present GST ACT, The TDS recovered under section 192 and 194 sections be allowed to be set off against the TDS on the income bill recovered by the Govt and remitted on behalf of the contractor and for balance amount only the TDS deducted be advised to be remitted. why the tds dept expects double payment by the employer aswell as contractee and set off at return stage for balance payable or refund. why not allowed monthly/quarterly set off of tds receivable to tds payable and balance only be remitted but the tds portal to allow generation of form16 and mechanism for such set off credits under form26as needs to be formulated. this will minimize defaults and allow genuine assesse suffering erratic receipt of payments from govt.dept’s, tds without penalties,interest burden but the govt expects inflows of funds with both hands from supplier and receiver of service. why such change not coming in law – poochiyae-poochiyae, koi -koi ,shak yaa -shak yaa , sawaal.-sawaal to tax dept,…….????

  4. srinivas says:

    it is all rubbish by the govt to collect the marketing income of any individuals. is any govt staff has done any thing to achieve that much of marketing turnovers and why govt pressurize to deposit it, it should be on a voluntary basis that the business men if feel think fit to redeposit but forceful act by the govt is just inhuman. becz what govt is doing is nothing but distributing among all govt officials in various forms and the magic miracles is that officials are enjoying everything. at least a businessmen will offer jobs for the general public

    • ROCKS says:

      YOUR WORDS ARE NOT RELEVANT FOR ABOVE MENTIONED CASE LAWS.

      YOUR WORDS SAYS PARTIALLY RIGHT THING.
      BUT PRESENT CASE IS DIFFERENT.

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