Caught between insolvency and tax law, thousands of ex-Gensol staff risk paying TDS twice after the collapsed group failed to deposit deductions for a year.
Around 2200 former employees of the Gensol Group face a potential double taxation nightmare. Their employer deducted tax at source (TDS) from salaries but failed to deposit it with the government for more than a year. Under Indian tax law, the liability still falls on employees, even if the employer is at fault.
Salaries have not been paid since March 2025. Four former executives disclosed that Gensol Engineering and its group company BluSmart Mobility stopped depositing TDS from April 2024. The lapse has left staff without Form 16, an essential document for filing tax returns, just weeks before the 15 September deadline.
According to a report by Mint, another insider revealed that the company had a long-standing habit of depositing TDS in a lump sum at year-end rather than monthly, referring to promoter Anmol Singh Jaggi, who had said that this was the usual practice.
Reportedly, Jaggi had assured employees in March that all TDS dues would be cleared by 15 April, but the payment never materialised. Payroll was handled manually, with no employee dashboard to track deductions.
However, there were no comments from the Jaggi brothers on this matter. Interim resolution professional Keshav Khaneja, overseeing Gensol’s insolvency proceedings, said he has no access to employee salary or TDS records, complicating efforts to resolve outstanding dues.
While the Income Tax Act technically holds employees responsible for unpaid TDS, multiple High Courts, including Delhi, Bombay, and Karnataka, have ruled that staff should not bear the burden when an employer defaults, particularly during insolvency.
The matter may ultimately have to be settled in court, as happened in previous corporate collapses, such as Kingfisher Airlines and, more recently, Byju’s, where employees faced similar tax disputes.
Adding to its troubles, Gensol is under intense financial and regulatory scrutiny. The Indian Renewable Energy Development Agency (IREDA) has filed two insolvency petitions against the group for defaulting on loans totalling over ₹7.28 billion.
The company’s collapse, coupled with its TDS default, has left thousands of employees in limbo; uncertain whether they will face further tax demands on money already deducted from their salaries.
