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TMI Blog2023 (12) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... e revenue? - HELD THAT:- In the case of BDR Finvest Pvt. Ltd. vs DCIT, [ 2023 (11) TMI 808 - DELHI HIGH COURT ] it was clarified that payment of the tax deducted at source to the Central Government has to be understood as the payment in accordance with law. The petitioner having accepted the salary after deduction of income tax at source had no further control over it in the sense that thereafter it was the duty of his employer acting as tax collecting agent of the revenue under Chapter XVII of the Act to pay the deducted tax amount to the Central Government in accordance with law. The employer of the petitioner having failed to perform his duty to deposit the deducted tax with the revenue, petitioner cannot be penalized. It would always be open for revenue to proceed against employer of the petitioner for recovery of the deducted tax. Same view has been taken by this court in the case of PCIT vs Jasjit Singh [ 2023 (12) TMI 34 - DELHI HIGH COURT ] Section 199 of the Act, in our view cannot operate as impediment to grant relief to the petitioner. The petition is allowed, thereby setting aside the intimations/communications issued by respondent no. 3 u/s 143 of the Act raising a dem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons/orders dated 21.03.2011 (Annexure P/6); dated 23.10.2012 (Annexure P/10); dated 16.01.2014 (Annexure P/14); dated 24.09.2016 (Annexure P/22); dated 24.09.2018 (Annexure P/34); dated 18.09.2019 (Annexure P/36); and dated 23.01.2021 (Annexure P/39) under Section 143(1) of the Act for the adjustments of refunds, and for raising of demand on account of Unmatched Tax Deducted at Source ; and/or viii. To declare that the Respondents Authorities abide strictly by the instruction No. 275 dated 01.06.2015 and the further Office Memorandum dated 11.03.2016 and Press Release dated 11.03.2016 issued by the CBDT; and/or ix. Issue an appropriate writ, order, or direction to Respondents to act on the provisions of the statute, in a manner, that the express rights so conferred upon the assessees do not get frustrated for non-action on the part of the Respondents; and/or x. Issue an appropriate writ, order, or direction to Respondents to not to take any coercive action till the pendency of this Writ Petition; and/or xi. Issue any other writ, order or direction in favour of the Petitioner, as this Hon ble Court may deem fit and proper in the present facts and circumstances of the case, so as to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act seeking to set aside the demands raised for AYs 2009-10, 2011-12 and 2012-13 as well as to allow the credit of tax deducted at source in view of Section 205 of the Act. 2.6 On 15.07.2014, Karnataka High Court in ITA 165/2012 directed the revenue authorities to recover TDS amounting to Rs. 302 crores from the employer of the petitioner. On 18.11.2016, the Kingfisher Airlines Limited (employer of the petitioner) was ordered to be wound up by the Karnataka High Court. 2.7 On 16.06.2016, petitioner filed his return of income for AY 2016-17 claiming a refund of Rs. 62,280/-. On 24.09.2016, the respondents issued intimation under Section 143(1) of the Act, thereby making an adjustment of Rs. 63,569/- and raising a demand of Rs. 15,36,020/- for AY 2009-10. 2.8 On 27.09.2017, petitioner filed his return of income for AY 2017-18 claiming refund of Rs. 66,390/-. On 19.10.2017, respondents issued intimation under Section 143(1) of the Act for AY 2017-18 thereby making an adjustment of Rs. 66,850/-. 2.9 In view of repeated adjustments of refunds, petitioner filed application dated 11.02.2018 seeking stay of the demands appearing on portal of Income Tax Department for AYs 2009-10, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osit the deducted tax with the revenue. 5. The said issue stands covered by the judgment of this court in the case of Sanjay Sudan vs Assistant Commissioner of Income Tax, [2023] 148 taxmann.com 329 (Delhi). The relevant observations made in the said judgment are set forth hereafter: 5. Mr Sanjay Kumar, learned senior standing counsel, who appears on behalf of the respondents/revenue, says that the credit for withholding tax can only be given in terms of Section 199 of the Act, when the amount is received in the Central Government account. 5.1 It is, therefore, his submission that while no coercive measure can be taken against the petitioner, the demand will remain outstanding and cannot, thus, be effaced. 6. We have heard counsel for the parties. 7. According to us, Section 205 read with instruction dated 01.06.2015, clearly point in the direction that the deductee/assessee cannot be called upon to pay tax, which has been deducted at source from his income. The plain language of Section 205 of the Act points in this direction. For the sake of convenience, Section 205 is extracted hereafter: Section 205 Bar against direct demand on assessee. Where tax is deductible at the source un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... educted at source to the Central Government has to be understood as the payment in accordance with law. 8. The petitioner having accepted the salary after deduction of income tax at source had no further control over it in the sense that thereafter it was the duty of his employer acting as tax collecting agent of the revenue under Chapter XVII of the Act to pay the deducted tax amount to the Central Government in accordance with law. The employer of the petitioner having failed to perform his duty to deposit the deducted tax with the revenue, petitioner cannot be penalized. It would always be open for revenue to proceed against employer of the petitioner for recovery of the deducted tax. 9. Same view has been taken by this court in the case of PCIT vs Jasjit Singh, ITA 295/2023 decided on 02.11.2023 (subsequent to the date when judgment in this case was reserved). Section 199 of the Act, in our view cannot operate as impediment to grant relief to the petitioner. 10. In view of the aforesaid, the petition as well as the interim relief application (CM APPL 6192/2022) are allowed, thereby setting aside the intimations/communications dated 21.03.2011 pertaining to Assessment Year 2009- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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