Edtech firm Byju’s has allegedly failed to remit the Tax Deducted at Source (TDS) to the government despite employees payslips indicating tax deductions. This has been happening as early as July last year.
Byju’s, once hailed as India’s most-valued startup, is going through a tumultuous time since 2022 as they failed to comply with accounting regulations, alleged mis-selling of courses, and massive job layoffs.
According to a report by Moneycontrol, it is reported that in the last 12 months the company has laid off more than thousands of employees owing to decline in demand for online learning services and funding.
Advertisement
With its investor board members leaving due to differences with the founder Raveendran Byju, the edtech platform had started a rights issue at a 99 per cent cut on its last fundraise valuation of $22 billion.
Not agreeing to such a resort from the company, investors like Peak XV, Prosus and General Atlantic have taken the issue to the court hoping to block the rights issue and change the management in the company.
Reportedly, many have stated that the company has not paid their F&F dues with payment to EPFO not happening since December.
Current and former employees also stated that they have not received their Form 16, which is given by an employer which contains details of income and taxes. When the employees wanted to check their income tax filing as the deadline on July 31 approached, it was revealed that it did not have any TDS much to their shock.
Advertisement
“If a company does not deposit TDS with the tax department, it is an offence without a doubt. The company is required to deposit TDS in the 7 days of the following month in which it is being deducted. If they don’t, they are liable to pay interest for the delay, there is a penalty and it is also a prosecutable offence — which means the company’s directors can be put behind bars for this in some extreme cases”, said Ajay Rotti, founder and CEO of Tax Compaas, a boutique tax advisory company, reported Moneycontrol
“It is not a common occurrence to not deposit TDS because most companies take this very seriously. Right now, court rulings are very clear that if the employer has not deposited the TDS, the employee is not liable to pay it,” he further added.
Meanwhile, for many of its releases, the cash-strapped company has not deposited provident funds since December.
It was reported that in November 2023 PF count for the employees was 16,220 which is a 66 percent drop from 2022 when it was 47,632.
When the employees had raised the issue to the HR, it was reported that they were met with vague responses, while others did not get any response at all.
Advertisement
The company allegedly stonewalled employees trying to contact the human resources team, reported Moneycontrol.
“The agony of the employees is real, but what can we do? For some employees, the payments of dues have begun and they have started getting the messages from EPFO. However, we cannot yet commit to a fixed timeline of when the payments will be completed,” said a person close to the developments.
Just one email a week