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TMI Blog2022 (10) TMI 902X X X X Extracts X X X X X X X X Extracts X X X X ..... assed against the assessee in default EIEL who was employer of the appellant. That being so, having taken recourse under law by raising a demand for non-deposition of TDS u/s 201 and interest u/s 201(1A) of the Act and which stands further determined and admitted under the Corporate Insolvency Resolution Process then there could have been no justification under law to deny the credit to the assessee because as such the Government s claim of TDS stands satisfied and cannot be said to be still outstanding. Even otherwise Section 205 of the Act is very crystal clear in its intention and clarifies that where tax stands deducted at source the assessee shall not be called upon to pay the tax himself to the extent to which tax has been deducted from the income. In the case in hand as noticed above, the deduction of tax from the salary of assessee is not disputed and Government s claim of TDS stands satisfied under CRP and cannot be said to be still outstanding so as to deny its credit to the assessee. CIT(A) has been carried away by irrelevant facts of assessee himself occupying the position of Vice President (Finance) of the assessee in default company. Ld. CIT(A) failed to appreci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1), it can be observed that out of total credit of INR 12,74,469 claimed, credit for TDS of INR 12,24,376 deducted by Era Infra Engineering Ltd (EIEL) was not allowed to the assessee despite being duly claimed in the return of income. The same was not allowed to the assessee for the reason that such TDS was not reflected in Form 26AS available at paper book page 2. 2.1 The case of assessee is that during the year under consideration, the appellant was employed with M/s. Era Infra Engineering Limited (EIEL) at designation of Senior Vice President (Finance) [Sr. VP (Finance)]. TDS on salary paid to the appellant was deducted by EIEL. In the month of April- 2015 TDS amounting to Rs. 1,26,186/- was deducted by EIEL which increased in subsequent months. The appellant claimed total TDS amounting to Rs. 12,24,376/- deducted by EIEL. These deducted TDS were not deposited with Central Government s account (Govt. s A/c) by EIEL. As the TDS entries were not reflected in Form-26AS, claim of TDS was not granted by the CPC while processing the return of income u/s 143(1) of the Act. 3. Ld. CIT(A) in its impugned order observed; As seen from above table, EIEL defaulted for deposition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deduction would not be deposited by the company to the Govt's A/c. The appellant has failed to provide documentary evidence that TDS deduction was bonafide. The appellant has produced salary slips which has figures of TDS deducted, chart of salary break up, bank statements, chart of TDS PF deducted. But no Form-16/TDS Certificate issued by employer has been produced. 5.5 In view of above discussion, it is observed that the appellant was at post of Sr. Vice President (Finance) in EIEL. The appellant was among one of persons who were in totality responsible for financial system and financial transactions of EIEL, including deduction of TDS and deposition of TDS to Govt. s A/c. The EIEL had deducted TDS of employees from top to lower management, contractors etc. which was not deposited by EIEL to the Govt. s A/c. Such act would have caused harassment to all employees, contractors etc. whose TDS was deducted but not deposited. This resulted into unnecessary demand and undue harassment to the employees of EIEL, contractors etc. It was not bonafide but a deliberate act of not depositing TDS to the Govt. s A/c, which crated undue harassment for the persons/ tax payers. EIEL del ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner of Income Tax (TDS) Noida of which the claim to the extent of Rs. 37,27,31,819/- stood admitted Corporate Insolvency process as on 07.03.2022 and Rs.24,79,45,328/- was the claim amount for ACIT/DCIT (TDS), New Delhi and claim to the extent of Rs. 24,79,45,328/- stood admitted under the Corporate Insolvency process as on 07.03.2022. The both were exclusively on account of TDS defaults. 7.1 Section 31(1) of the Insolvency and Bankruptcy Code ( hereinafter referred as IBC) after the amendment of 2019, makes the Resolution plan binding on Central Government in respect of payment of dues arising under any law for the time being enforce. Further section 238 of the IBC specifically provides that the IBC overrides the provisions of any law that is inconsistent with the IBC. 8. In the case in hand EIEL was an assessee in default u/s 201 of the Act and sub-section 2 of Section 201 provides that such tax along with interest thereupon as recoverable under sub-section (1A), shall be a charge upon all the assets of the assessee in default. 8.1 It is admitted fact that order u/s 201/ 201(1A) of the Act for the relevant financial year stands passed against the assessee in default EIE ..... X X X X Extracts X X X X X X X X Extracts X X X X
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