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Govt probes books of defaulters to check TDS compliance
NEW DELHI: The income tax department has decided to go through the books of top bank defaulters with a toothcomb, to check whether tax deducted at source (TDS) on the salaries of their employees have been deposited by these companies.
The Vijay Mallya-promoted Kingfisher Airlines, in several cases, had deducted TDS from employees’ salaries, but did not deposit it with the government.
“We are going to examine the accounts to understand if there hasbeenanysuchdiscrepancies with other defaulters as well,” a senior government official told HT on the condition of anonymity.
In 2014, tax authorities filed a case in the special economic offences court in Bangalore against the now defunct Kingfisher Airlines for failing to deposit TDS worth around ₹260 crore from 2009-2011.
“It is a criminal offence to deduct TDS and not deposit it with the government. So we filed a case against Kingfisher. We were the first agency to get a summon out for Mallya,” said the source quoted above.
The Income Tax Act provides for criminal prosecution against those failing to deposit TDS deducted from employees with the government. According to government sources, while banks are looking at ways of recovering their dues from defaulters, the tax department has enough reasons to investigate the books of the defaulters to see whether TDS deducted has been paid to the government.
The Reserve Bank of India recently submitted a list of top bank defaulters to the Supreme Court.
According to the All India Banks’ Employees Association, 5,610 wilful defaulters had collectively defrauded banks, both public and private, of a sum of ₹58,792 crore, as of March 31, 2016.
The association, which released the names of the defaulters earlier this month, said public sector banks have 3,192 accounts as wilful defaulters, with bad assets to the tune of ₹28,775 crore.
Among the top defaulters are Winsome Diamonds and Jewellery, Forever Precious Jewellery & Diamonds, Kingfisher Airlines and Deccan Chronicle Holdings.