Hello,
There is a penalty for non-filing of the returns and there is no punishment prescribed in the act and as such if any notice is issued by the income tax department then you may deposit the pending dues with interest.
Regards
Issue: A private limited firm with outstanding taxes
Issue : A private limited firm with an outstanding of Service tax : Approximately Rs 18.5 Lacs since 2017 with added interest as per computation GST : Approximately Rs. 8 Lacs plus interest since 2017 end cleared in full with interest around March 31st, 2019 TDS: Approximately Rs. 5 Lacs since 2017 cleared in full around August 2018 And, Returns not files for the last 2 financial years And, Not audited for the last 2 financial years And, Summon received as enclosed. My questions : Is any of the following punishable by imprisonment ? - Not auditing the company for 2 consecutive financial years - Not filing returns for 2 consecutive financial years - Having an outstanding of TDS/GST/Service Tax to the extent mentioned above Additional info the company has 2 domestic directors the company has 2 Indian shareholders – both directors and 1 international shareholding company which is now no longer functioning (liquidated) the company is currently non operational for the last 2 years and had run into losses the gst dues have been cleared by me from my personal funds alongwith interest the tds dues have been cleared form my personal funds alongwith the interest
Asked 6 years ago in Taxation
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6 Answers
Yes it is if filed at a magistrate court otherwise no issues. But it takes a lot of time for establishing criminal liability.
. TDS Default Amount and period is Important:
CBDT has issued instruction no. 1335 of CBDT, dated 28-5-1980 to the effect that prosecution should not normally be proposed when the amounts involved are not substantial and the amount in default has also been deposited in the meantime to the credit of the Government.
2)
The provisions of section 278AA lays down that no person shall be punishable for any failure referred to in section 276B if he proves that there was reasonable cause for such failure.
3) The Delhi High Court has ruled that non-filing of income tax returns can lead to prosecution even if the taxpayer was entitled for a refund had he filed a return.
Director shall be responsible for failure to file return and can penalize with fine or imprisonment & fine. And for audit failure, auditor is liable but if not appointed by company than director is liable.
Section 147 of the Companies Act, 2013 prescribes following punishments for contravention:
♣ If any of the provisions of sections 139 to 146 (both inclusive) is contravened,
- the company shall be punishable with fine which shall not be less than 25000 rupees but which may extend to 5,00,000 rupees and
- every officer of the company who is in default shall be punishable with imprisonment for a term which may extend to one year or with fine which shall not be less than ten thousand rupees but which may extend to one lakh rupees, or with both.
Dear Client
Yes there is provision for imprisonment upto one year for not paying outstanding if you don't have any reasonable cause for not paying the outstanding
