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2023 (12) TMI 63 - DELHI HIGH COURTNon deposit of TDS by employer - Kingfisher Airlines Limited - employer had not deposited the tax deducted at source, so the outstanding dues be recovered by the respondents from his employer - recovery from employee for default in TDS deposits - credit of TDS deduction denied - as per revenue no credit for tax can be given to the petitioner, since in view of the provisions u/s 199 of the Income Tax Act the credit can be given only when the tax which was deducted at source is paid to the Central Government and in the present case, admittedly the tax deducted from salary of the petitioner has not been deposited by his employer. Whether any recovery towards the said outstanding tax demand can be effected against the petitioner in view of the admitted position that the tax payable on salary of the petitioner was being regularly deducted at source by his employer namely Kingfisher Airlines Ltd. who did not deposit the deducted tax with the 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 demand of tax to the tune and consequently, also restraining the respondents from carrying out any recovery proceedings pertaining to the said intimations/ communications. However, it is clarified that in case the petitioner is able to obtain any amount of money towards tax deducted from his income at source for the Assessment Year 2012-13 from his employer, the same shall be deposited by him with the revenue forthwith.
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