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1999 (6) TMI 19

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..... "201. (1) If any such person and in the cases referred to in section 194, the principal officer and the company of which he is the principal officer does not deduct or after deducting fails to pay the tax as required by or under this Act, he or it shall, without prejudice to any other consequences which he or it may incur, be deemed to be an assessee in default in respect of the tax : Provide .....

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..... mount of the tax together with the amount of simple interest thereon referred to in sub section (1A) shall be a charge upon all the assets of the person, or the company, as the case maybe, referred to in sub section (1)." The petitioner has not deducted the tax which was required to be deducted under section 194C of the Income-tax Act, 1961. The submission is that, under section 201 of the Act, .....

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..... lure to deduct the tax, penal consequences have to follow. Section 201 is a penal provision to treat a person as an assessee in default if there is a failure to deduct the tax or after deducting the tax it is not paid. The proviso makes it clear, that the Assessing Officer must be satisfied that such failure was without good and sufficient reason. This contemplates an adjudication by the Assessi .....

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..... he tax under various sections of the Act, particularly, in Chapter XVII. The finding that there was a failure to deduct the tax has to be on the basis of either the assessment or other records available with the assessee and, therefore, the contention that no process or procedure has been stipulated, has no force. The Assessing Officer has to provide an opportunity and, therefore, there is suffici .....

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