9911796707
TMI Blog2005 (6) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... that the demands for the years 1999-2000 to 2001-02 were not correct or justified; that the said demand included even the amounts that had been deducted by her tenant one M/s. Krisen Development Corporation, who had taken the property belonging to the petitioner on a monthly rent of Rs. 1,35,000; that the said tenant had punctually deducted 20 per cent. of the rent amount in terms of section 194-I of the Act by remitting the rent less 20 per cent. to the petitioner every month, but in fact had not issued the corresponding deduction certificate in Form No. 16A and though this aspect had also been brought to the notice of the Department, no action as such had been taken, but nevertheless, the amount having not been remitted to the credit of the Department by the tenant and the Department having not realised the amount, is now looking to the petitioner for recovery of this amount and to such extent, the demand cannot be raised on the petitioner. It is on such stand, the present writ petition is filed praying for quashing of this demand notice to the extent of the amount mentioned therein being the amount which had already been deducted by the tenant of the petitioner whether remitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n advance payment of tax; that the deduction of tax at source in respect of rents payable by persons other than individuals or Hindu undivided families is provided for under section 194-I of the Act; that several obligations and responsibilities are cast under the Act on such persons and also the manner in which the amount is to be remitted; that in respect of such tax deducted from out of the income payable to the assessee and on the amount being paid to the Central Government; it has to be treated as payment of tax on behalf of the persons from whose income the deduction was made in terms of section 199 of the Act; that a conjoint reading of the provisions of sections 192, 194-I, 199 and 200, the duties of the person deducting the tax in terms of section 200, consequences of failure to deduct and pay the tax so deducted as envisaged in section 201, as also the provisions of section 202 of the Act, indicating that the deduction is only one mode of recovery; that section 203 itself, which enables or compels issue of a certificate by the persons deducting tax, indicating that the amount is so deducted and remitted to the credit of the Central Government etc.; that the word "deductio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertain factual aspects peculiar to this case. They are : The deduction by the lessee, the person responsible for doing so, is not much in dispute in this case, as the subsequent development does indicate that the Revenue had taken steps to realise the amount that had been deducted by the tenant but it is not fully successful in doing so and, therefore, looking to the assessee herself for recovery of the balance amount. While this is the assertion on the definite instructions by Sri Parthasarathi, learned counsel for the petitioner, Sri Seshachala, learned standing counsel appearing for the respondents, submits that unless it is confirmed from verification of the records also, he is not in a position to dispute the submission one way or the other. It appears that the Revenue had proceeded against the person responsible and has realized some amount and in respect of the balance it is now enforcing the demand against the assessee. If that is the factual position, it could be presumed that the tenant had in fact deducted the amount but had failed to remit the same to the Central Government. The question is as to whether the failure on the part of such person should result in the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or deduction and factual deduction and nothing more. In so far as such requirements are concerned, in the present case, it is not much in dispute that it has happened or fulfilled. In fact the bar only is not to raise demand on the assessee herself or to enforce recovery on the assessee after the deduction is made in respect of the amount deducted. That means, once deduction is made, the Revenue is expected to look to the person who had deducted the tax for realizing the amount, if such person fails in remitting the amount to the Central Government. I am of the view that this understanding and such interpretation of section 205 of the Act is also in consonance with the general principals of law, particularly the principles of the law of principal and agent. If we look at the scheme for the provision of deduction of tax at source, it becomes obvious that such person is acting on behalf of the Revenue, i.e., as an agent of the Revenue. In fact the person is enabled statutorily to make deduction and remit the amount to the Central Government, though in the instant case, the person who has deducted the amount may be the tenant or lessee of the petitioner and there is such inter se rel ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
