TMI Blog2023 (1) TMI 964X X X X Extracts X X X X X X X X Extracts X X X X ..... nce tax self-assessment tax and indirect method where taxes are deducted paid on behalf of the assessee i.e. through TDS mechanism and it shall not be out of the box to quote from the decision Hon ble Bombay High Court laid in Yashpal Sahni vs Rekha Hajarnavis, ACIT [ 2007 (7) TMI 7 - HIGH COURT , BOMBAY] In the matter of recovery of taxes it s worthy to note that, once the tax liability of the assessee is discharged by indirect method of TDS, then the rule of estoppel by virtue of provisions of section 205 of the Act comes into play, which invariably puts an embargo on the department from enforcing the recovery of taxes from the assessee where tax is deductible at the sources under chapter XVII of the Act from the payment liable f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Income Tax Act, 1961 [for short the Act ] confirming the denial of TDS credit by the Deputy Commissioner of Income Tax, Central Processing Centre, Bengaluru [for short CPC / AO ] u/s 143(1) of the Act for assessment years [for short AY ] 2018-19 2019-20. 2. Since the issue involved in this bunch of appeals is identical, with the agreement of parties present, the matter is heard together for a consolidated order, resultantly the adjudication in lead case ITA/508/PUN/2022 positioned in succeeding paragraphs, shall mutatis mutandis apply to ITA/605 to 509/PUN/2022. 3. Brief stated the facts of the case are; 3.1 The appellant assessee is a resident individual filed his return of income [for short ITR ] for AY 2018- 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f appellant. 3. The Ld. CIT(A) has erred in not affording reasonable opportunity of submitting the proof of TDS deduction in possession of the appellant, received through registered email-id of the employer (Nirmal Lifestyle Private Ltd.); and proceeding to deny TDS credit merely on that ground. 4. The Ld. AO and CIT has erred in not appreciating that the appellant is not at fault since as per the provisions of Sec. 192, when a person responsible for deduction of TDS has deducted the TDS, it becomes his liability to deposit the amount deducted with the Government and also furnish the TDS returns so as to enable the deductee/employee to claim credit thereof as per Form26AS. 5. The Ld. AO and CIT have erred in apprecia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e respondent and duly considered the facts of the case in the light of settled legal position forewarned to parties present. 7. In the present case, undisputedly the appellant was employed with M/s Nilkamal Lifestyle Limited on a salary and the accrual / receipt of which is offered to tax with the corresponding claim of TDS made u/s 192 of the Act by the employer thereagainst. The case of the revenue is that, the appellant is not entitled to credit of TDS owning to failure of deductor-employer to deposit the said amount of TDS to the credit of Central Exchequer and reporting thereof through filing of TDS return viz 24Q. Per contra in support of Annexur-2 a document showcasing the deduction of taxes from salary, the appellant denies the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of recovery of taxes envisaged in the Act obliterates the assessee from the tax liability and we find that, vide para 33, a similar view found taken by the Hon ble Madras High Court in Ashok Kumar B. Chowatia Vs JCIT (TDS) reported in 435 ITR 449; 33. 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. 10. In the present facts and circumstances, we ar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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