Deemed assessee in default: failure to deduct or pay tax triggers default; penalty requires absence of good and sufficient reasons. Any person required to deduct tax at source, including a company's principal officer and specified employers, who fails to deduct or, having deducted, fails to pay the whole or any part of the tax, is deemed an assessee in default in respect of that tax. Imposition of a penalty for such failure is subject to the Assessing Officer being satisfied that the person failed to deduct and pay the tax without good and sufficient reasons.