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TMI Blog2021 (5) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... demanding arrears of tax to the petitioners. To the extent tax was deducted by the second respondent and not remitted by the second respondent to the Income Tax Department, recovery can be only directed against the second respondent as the second respondent is the assessee in default. The petitioner cannot be made to pay tax twice. Recovery of any of such Tax Deducted at Source but not remitted by the second respondent has to be recovered only from the second respondent. We quash the respective demand notices and direct the third respondent to issue fresh demand notices to the petitioners after taking note of the subsequent developments and payments made by the 2nd respondent. It is made clear that to the extent Tax was Deducted by the second respondent but not remitted, no demand shall be made against the petitioners. If the second respondent had failed to remit the tax to the credit of the Income Tax Department, it is however open to the department to recover the same from the 2nd respondent in the manner known to Law. Balance of tax if any, which has escaped payment alone can be recovered from the Petitioners, by issuing suitable notice under the provisions of the Income T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce with law. The said exercise shall be completed within a period of four weeks from the date of receipt of a copy of this order . 6. The writ petitions are disposed of with the above directions. No costs. Consequently, connected Mps are closed. 5. It is submitted that an enquiry was conducted pursuant to which three separate orders dated 16.01.2018 for the financial years 2010-11, 2011-12, 2012-13 were passed by the 4th respondent against the 2nd respondent wherein the undertaking of the second respondent was also recorded. 6. It is submitted that it is not open for the respondents namely the 3rd respondent/Deputy Commissioner of Income Tax, to issue demand notice to the petitioner to demand tax vide impugned demand notice dated 03.08.2017, 02.11.2017 25.01.2018 in respect of these Assessment Years. 7. It is submitted that pursuant to the aforesaid order of this Court on 13.10.2015, the Income Tax Officer (TDS Ward 2), Chennai has also passed consequential orders by holding that the 2nd respondent was tenant and an assessee in default and therefore liable to pay the deducted amounts for the Assessment Years 2010-2011, 2011-2012, 2012-2013 dated 16.01.2018 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned order, the learned senior standing counsel for the Income Tax Department submits that the tax deduction at source by the 2nd respondent for the Assessment Years 2011-2012 2012-2013 has been remitted by the 2nd respondent and therefore, the balance period the amount has to be paid by the petitioners. 16. It is further submitted that there was a dispute between the respective petitioners who are the owners/land-lords of the property with the 2nd respondent/tenant which was rented out to the 2nd respondent/tenant and that Memorandum of understanding was signed between them on 30.07.2014 as per which the respective petitioners have secured their interest by asking the 2nd respondent to deposit the amount deducted towards tax. In case such amount is not paid, the 2nd respondent had given cheque to cover the same. 17. It is submitted that no amount was deducted as no amounts were paid and therefore question of invoking Section 205 of the Income Tax Act, 1961 did not arise at all. He further submits that under Section 191 of the IT Act, in case of income in respect of which provision is not made under the provisions of the IT Act for deducting income-tax at the time o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent was in arrears of lease rental to the petitioners and that as on the date of the said Memorandum of Understanding on 30.07.2014, the second respondent was in arrears of ₹ 64,96, 650/- to the Land-lords. Against the aforesaid arrears, the petitioners along with other owners adjusted the interests free deposit of ₹ 34,53,640/- leaving a balance of ₹ 30,43,010/-to be paid to the petitioners by the 2nd respondent on or before 31.8.2014. ₹ 30,43,010/- which included the rent payable up to the said date. To that effect, the second respondent is supposed to have given a post-dated cheques drawn on Axis Bank, Anna Salai, Chennai. 24.That apart in Para 4(a) of the said Memorandum of Understanding, it is recorded that the second respondent had not remitted Tax Deducted at Source on the payments made earlier to the petitioners and others for an amount of ₹ 33,16,192/- as per annexure II to the said Memorandum of Understanding. 25. Annexure II of the said Memorandum of Understanding details, the Tax Deducted at Source by the second respondent for the Financial years 2010-11 (Assessment year 2011-12), Financial year 2011-12 (Assessment years 2012-13), Fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Financial Year Assessment Years W.P.No.311 67 of 2018* W.P.No.31170of 2018* W.P.No. 31172of 2018 W.P.No.3117 4of 2018 2010-11 2011-12 3,34,202.50 3,34,202.50 3,34,202.50 33402.00 2011-12 2012-13 73,107.00* 73,107.00 3,34,202.50 33402.00 2012-13 2013-14 73,107.00* 73,107.00 3,34,202.50 33402.00 2013-14 2014-15 73,107.00* 73,107.00 3,34,202.50 33402.00 2014-15 2015-16 30,461.50 30,461.50 30,461.50 30,461.50 Total 5,83,984.00 5,83,984.00 5,83,984.00 5,83,984.00 Whereas, the respective dema ..... X X X X Extracts X X X X X X X X Extracts X X X X
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