Tax withholding defaults trigger assessee-in-default status, interest, asset charges, limitation rules, and conditional penalty where statutory compliance fails.

Section 398 treats a person who fails to deduct, collect, deposit, or otherwise pay required tax as an assessee in default, subject to interest, penalty, and recovery consequences. Relief applies where the recipient has filed a return, included the amount in income, paid due tax, and the deductor or collector furnishes the prescribed accountant's certificate. Unpaid tax and interest create a charge on the assessee's assets. Penalty requires satisfaction that the failure lacked good and sufficient reasons.

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