57. Consequences of failure to deduct, Collect, etc.-

¹[57. Consequences of failure to deduct, Collect, etc.- 

[(1) Where a person-

(a) fails to deduct or collect tax at source as required by or under the provisions of this Chapter; or
(b) deducts or collects tax at a lesser rate or in lesser amount; or
(c) after deducting or collecting tax under this chapter, fails to pay the same to the credit of the government, or pays to the credit of the Government an amount lower than the collected or deducted amount;
Such person shall be deemed to be an asseesee in default, and without prejudice to any other consequences to which such person may be liable, shall be personally liable to pay-

(i) the amount of tax that has not been deducted or collected; or
(ii) the amount which was required to be deducted or collected under this Chapter as reduced by the amount that has been actually deducted or collected; or
(iii) the amount that, after being collected and deducted, has not been paid to the credit of the Government.

(2) In addition to the amount as mentioned in sub-section(1), the person shall also be liable to pay an additional amount at the rate of two percent (2%) per month on the amount as mentioned in sub-clause(i),(ii)and(iii)of clause(c) of sub-section(1), as the case or cases may be, calculated for the period-

(i) in the case of failure to deduct or collect, or of the deduction or collection at lower rate or amount, from the due date of the deduction or collection to the date of the payment of the amount, as mentioned in sub-clauses (i) or (ii) of clause (c) of sub-section(1), as the case may be, to the credit of the Government;
(ii) in the case of failure to deposit the amount deducted or collected, from the date of deduction or collection to the date of payment of the amount, as mentioned in sub-clause (iii) of clause (c) of sub-section(1), to the credit of the Government.

Explanation.- The period for which the additional amount is calculated shall not exceed twenty four months.

(3) The Deputy Commissioner of Taxes shall take necessary action for the realization of the amount as mentioned in sub-section(1) and the additional amount as mentioned in sub-section (2) from the person referred to in sub-section (1) after giving the person a reasonable opportunity of being heard.
(4) No realization of the amount mentioned in sub-section (1) shall be made if it is established that such amount has meanwhile been paid by the person from whom the deduction or collection was due.]

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¹ Subs. by F.A. 2016

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