A Delhi court has convicted Naftogaz India Company Pvt Ltd and its director Mahdoom Bava in a TDS default case, sentencing Bava to one year and 10 months of rigorous imprisonment and imposing a Rs 10 lakh fine.
The case relates to tax deducted at source (TDS) of Rs 17.69 crore during financial year 2009-10 that was allegedly not deposited with the government.
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At the time of an income-tax survey, the company's cumulative TDS liability for FY2010-11 stood at Rs 21.22 crore.
The court also fined Naftogaz India Rs 10 lakh, directing that the amount be paid from the company's assets.
It held that failure to deposit tax deducted at source constitutes a serious fiscal offence and carries criminal consequences.
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The court further ruled that the subsequent liquidation of the company does not extinguish its criminal liability.
It also does not absolve a director responsible for the company's conduct under Section 278B of the Income Tax Act.
Bava will face an additional three months in jail if he fails to pay the fine.
However, the court has suspended his sentence for 30 days and granted him bail, with the matter listed for September 25, 2026.
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