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TDS details of Satyam employees under I-T lens
January, 27th 2009

The Central Board of Direct Taxes has sought a fresh report from its field officers about the details of tax deducted at source (TDS) submitted by Satyam, to get fresh leads in the case after the Andhra Pradesh CID accused the company of having 13,000 ghost employees on its rolls, a senior government official said.

Preliminary examination of the TDS data indicated the company had nearly 47,000 employees, said the official, who did not wish to be identified. Satyams internal assessment also confirms it has close to 50,000 employees. We dont know the exact number of employees but were comfortable with the fact that theres no large-scale fraud in employee numbers. Were in the middle of processing the salaries for January.

We have checked the employee numbers in many different ways and were going ahead with salaries of those people, said Satyam board member Kiran Karnik. Satyam had 47,000 employees with salaries in the taxable limit, but it may have also had scores of employees with salaries below the tax threshold. Tax authorities will now look into the companys returns and permanent account numbers (PAN) of employees quoted in the returns filed by Satyam in the past few years.

Tax authorities would also check the TDS details of payments made to contractors and suppliers, the official said.

According to income-tax department data, Satyam was among the top 30 tax deductors in the country, with 47,000 employees. The TDS submitted by Satyam surpassed that of large companies such as ONGC, TCS and Air India.
 
Every company has to mandatorily deduct tax from each employees salary in line with the tax bracket. A company also has to file a TDS return with the I-T authorities every quarter. This return form (Form 24Q), which is separate from the companys own annual income-tax return form, mentions PANs of employees for the deducted tax.

IT officials at the field level have already submitted a preliminary report and a status report on the case. The authorities have also decided to open the assessment of Satyams I-T returns for the past six years. They are also likely to examine the TDS certificates from banks in lieu of the tax deducted on interest payments on Satyams deposits, submitted by the company along with its income-tax returns.

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