Delhi High Court Quashes Tax Demand Against Ex-Kingfisher Airlines Employee Over Undeposited TDS

The Delhi High Court on 21 August quashed a tax demand raised against a taxpayer after finding that his former employer, Kingfisher Airlines, failed to deposit the Tax Deducted at Source (TDS) deducted from his salary.

A Division Bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta allowed the petition and directed the Revenue to refund the amount recovered from the petitioner within three months.

The dispute arose from an intimation dated 23 September 2025 issued under Section 143(1) of the Income Tax Act for Assessment Year 2011-12.

The petitioner submitted that credit had not been given for TDS of Rs. 5,59,792 deducted by Kingfisher Airlines, his erstwhile employer, from his salary. He relied on the High Court's earlier judgment in Satwant Singh Sanghera v. Assistant Commissioner of Income Tax, where similar relief was granted to a pilot formerly employed with Kingfisher Airlines against a tax demand of over Rs. 11 lakh.

He further submitted that the Department had already recovered a substantial part of the demand from a refund that had become due to him. He therefore sought quashing of the Section 143(1) intimation as well as refund of the amount recovered from him.

The Court, however, held that “the Petitioner cannot be blamed for that and deprived of his legitimate right, as has been held by this Court in its judgement Satwant Singh Sanghera (supra).”

Accordingly, the High Court declared the demand and recovery made from the petitioner illegal and directed the Revenue to refund the amount within three months.