TaxTMI 
TaxTMI 
2010 (11) TMI 17
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....itions are disposed of together as not only the parties but the facts and the questions of law involved therein are same. 3. Briefly stated, facts of the case are that the petitioner had filed complaints before the ACMM praying therein that the respondent be summoned, tried and punished under Section 276-B of the Act. It was alleged that the respondent no. 1 was a private limited company; while respondent No. 3 was its Director and "Principal Officer" and was responsible for managing the day-to-day affairs of the company. Respondents had failed to deduct the tax at source (TDS) from the interest paid to M/s Bhanamal & Co. (P) Ltd., M/s Banwari Lal & Sons (P) Ltd. and M/s Bhanamal Gulzari Mal (P) Ltd., and deposit the same with the ....
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.... 204: Meaning of "Person responsible for paying"- For the purposes of sections 192 to 194, section 194A, section 194B, section 194BB, section 194C, section 194D, section 194E, section 194EE, section 194F, section 194G, section 194H, section 194-I, section 194J and section 194K, 194L sections 195 to 203 and section 285, the expression "person responsible for paying" means - (i) In the case of payment of income chargeable under the head "Salaries" other than payments by the Central Government or the Government of a State, the employer himself or, if the employer is a company, the company itself, including the principal officer thereof; (ii) In the case of payments of income chargeable under the head "Interest on securities" oth....
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....fer to Section 2 (35) herein which reads as under :- "(35) "principal officer", used with reference to a local authority or a company or any other public body or any association of persons or any body of individuals, means- (a) the secretary, treasurer, manager or agent of the authority, company or association, or body, or (b) any person connected with the management or administration of the local authority, company, association or body upon whom the Assessing Officer has served a notice of his intention of treating him as the principal officer thereof;" 11. A perusal of the aforesaid provision clearly shows that the director is not included within the ambit of Sub-clause (a) of Section 2(35) of the Act. In case the Income....
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....hil Suri and Ors. Vs. State & Ors. (2008) 303 ITR 86 (Delhi), a Single Judge of this Court has held that before a prosecution under Section 276-B of the Act can be launched against the director he should have been notified that department/AO has intention of treating him as "principal officer" of the company. In absence of such notice under Section 2(35)(b) of the Act, prosecution against the director cannot be continued and is bound to fail. 15. In Madhumilan Syntex Ltd. and Others vs. Union of India (2007) 290 ITR 199 (SC), the Supreme Court has held as under:- "To treat the directors of a company as "principal officers" there is no need to issue a separate notice or communication to them that they are to be trea....