OP(MAC) No. 652/2011 & WP(C) No. 31473/2009, High Court of Kerala at Ernakulam

``` IN THE HIGH COURT OF KERALA AT ERNAKULAM ``` ``` PRESENT ``` ``` THE HONOURABLE MR. JUSTICE RAJA VIJAYARAGHAVAN V ``` ``` THURSDAY, THE 16[TH]DAY OF FEBRUARY 2023 / 27TH MAGHA,1944 OP (MAC) NO. 652 OF 2011 AGAINST THE ORDER/JUDGMENT OPMV 391/1999 OF MOTOR ACCIDENT CLAIMS TRIBUNAL, TRIVANDRUM ``` ``` PETITIONER: ``` ``` TAMIL NADU STATE TRANSPORT CORPORATION LTD., (KUMBAKONAM DIVISION II), THIRUCHIRAPALLY, REPRESENTED BY ITS GENERAL MANAGER. ``` ``` BY ADV SRI.SUBHASH CYRIAC ``` ``` RESPONDENT: ``` ``` VIJAYAKUMARI, TC 21/1013, NANTHENCODE, KOWDIR P.O., THIRUVANANTHAPURAM. ``` ``` THISWRITPETITION(CIVIL)HAVINGCOMEUPFORADMISSION ON16.02.2023,ALONGWITHWP(C).31473/2009,THECOURTONTHE SAME DAY DELIVERED THE FOLLOWING: ``` 2 O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 ``` IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE RAJA VIJAYARAGHAVAN V THURSDAY, THE 16[TH]DAY OF FEBRUARY 2023 / 27TH MAGHA,1944 WP(C) NO. 31473 OF 2009 AGAINST THE ORDER/JUDGMENTOPMV 849/2000 OF MOTOR ACCIDENT CLAIMS TRIBUNAL ,NEYYATTINKARA ``` ``` PETITIONER: ``` ``` THE MANAGING DIRECTOR, TAMIL NADU STATE TRANSPORT CORPORATION, NAGERCOIL. ``` ``` BY ADV SRI.SUBHASH CYRIAC ``` ``` RESPONDENTS: ``` ``` 1K.I.BINDHU, W/O LATE SATHEESH KUMAR, KRISHNA NIVAS, ANAVOOR P.O., NEYYATTINKARA. 2SANDEEP S/O.LATE SATHEESH KUMAR MINOR, KRISHNA NIVAS, ANAVOOR P.O., NEYYATTINKARA. 3SANTWANA D/O.LATE SATHEESH KUMAR, MINOR KRISHNA NIVAS, ANAVOOR P.O., NEYYATTINKARA. 4SARASWATHY AMMA W/O.PADNABHA PILLAI, KRISHNA NIVAS, ANAVOOR P.O., NEYYATTINKARA. 5PAUL PETER SELVARAJ, DOOR NO.324 R.C.CHURCH ROAD, NEAR THAKKAL POLICE STATION,, KALKURINI, THALAKULAM. ``` O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 3 ``` BY ADV SRI.D.KISHORE ``` ``` THISWRITPETITION(CIVIL)HAVINGCOMEUPFORADMISSION ON16.02.2023,ALONGWITHOP(MAC).652/2011,THECOURTONTHE SAME DAY DELIVERED THE FOLLOWING: ``` 4 O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 ## **JUDGMENT** OP(MAC) No.652/2011 is filed by the Tamil Nadu State Transport Corporation, represented by its General Manager, challenging Ext.P5 order issued by the Tribunal directing the corporation to initiate steps to refund the amounts wrongly deducted towards Tax Deducted at Source (TDS) from the amount due to the decree holder. By the said order, directions were issued to the corporation/ judgment debtor to deposit the balance amount of Rs.38,191/- . The prayer sought for in OP(MAC) 652/2011 are as under: i) call for the records leading to issuing of Ext.P5 and quash the same. ii) declare that the compensation payable under the MACT award, is subjected to the Tax deducted at source. iii) declare that the award in O.P(MV) 391/99 of the MACT, Thiruvananthapuram is fully satisfied. 2. W.P.(C) No. 31473/2009 is filed by the Managing Director, Tamil Nadu Road Transport Corporation, challenging Ext.P3 order by which the Tribunal after holding that the Corporation/judgment debtor is not entitled to deduct TDS issued directions to deposit the amount deducted. Directions were also issued to issue attachment warrant for the breach of the 5 O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 undertaking given by the officer while getting release of the vehicle attached by the court. Directions were issued to deduct a sum of Rs.19,948/- from the salary of Sri.Sabapathy Pandian. The prayer sought for in WP(C) 31473/2009 are as under: i) call for the records leading to issuing of Ext.P3 and P4 and quash the same. ii) Declare that the compensation payable under the MACT award, is subjected to the Tax deducted at source. iii) Declare that the Tribunal is not empowered to attach the salary of the official who had filed the affidavit for releasing the vehicle. 3. As identical issues are involved, both these petitions are taken up and disposed of by a common order. 4. Insofar as O.P(MAC) No.652/2011 is concerned, a Claim Petition filed by the respondent was awarded, and the Corporation was directed to pay a sum of Rs.3,02,000/- with 9% interest from 06.10.1998. The Corporation deducted a sum of Rs.38,191/- towards Tax Deducted at Source and issued a certificate under Section 203 of the Income Tax Act. The decree holder in the Execution Petition claimed that no amount was deductible, which was objected to by the judgment debtor. The Tribunal went on to hold that there was no justification in deducting the amount towards TDS and ordered refund. O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 6 5. Insofar as W.P.(C) No.31473/2009 is concerned, in a Claim Petition filed by the respondents seeking compensation for the death of the husband of the 1st respondent and the father of respondents 2 and 3, an award was passed by the Tribunal ordering the payment of compensation of Rs.6,00,000/with 7.5% interest from 05.09.2000. The Corporation deducted a sum of Rs.20,571/- towards Tax Deducted at Source and issued a certificate under Section 203 of the Income Tax Act. It appears from the impugned order that the award was challenged by the Corporation and finally their appeal was dismissed by the Hon’ble Supreme Court. The Tribunal ordered the deposit of the entire amount as per the attachment warrant and the vehicle of the Corporation was attached. An affidavit was filed by Sri.Sabhapathi, an officer of the judgment debtor, undertaking to pay the amount ordered by the Tribunal and the attached vehicle got released. It was in the said circumstances that Ext.P3 order was passed by the Tribunal holding that the officer had committed breach of undertaking given in the affidavit. For the said breach Ext.P4 order was issued to realise the balance amount due by attaching the salary of the officer who, after filing affidavit, violated the undertaking and got the vehicle released. 7 O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 6. The learned counsel appearing for the petitioner submitted that the order issued by the Tribunal cannot be sustained. The learned counsel would rely on the judgment rendered by a Division Bench of this Court in **Abdulla P.M. v. National Insurance Company & Anr** [2011 (3) KLT 496], and it was argued that the Hon’ble Division Bench had occasion to consider the difficulties faced by the claimants as well as the Insurance Companies and has issued directions to obviate the difficulties. Insofar as W.P.(C) No.31473/2009 is concerned, it is submitted that there was no justification in ordering the attachment of the salary of the officer who had filed the affidavit for releasing the vehicle. The learned counsel further contend that the officer was merely exercising his legal duty to deduct the amount towards income tax, and this was done strictly in accordance with the Income Tax Act. 7. The learned counsel appearing for the respondents vehemently opposed the prayer. He refers to the statutory provisions and submits that the petitioner was not bound to deduct income tax in terms of the provisions of the Income Tax source as the interest element was less than Rs.50,000/-. 8. I have considered the submissions advanced. O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 8 9. The short question that arises in this writ application is whether the petitioner is legally justified to deduct the income tax at source from the total amount of interest on the amount of compensation awarded by the Motor Vehicle Accident Claims Tribunal in favour of the claimants as per the provision of Section 194A(3)(ix) of the Income Tax Act,1961, if the amount of interest do not exceed Rs.50,000/- 10. To resolve the issue, reference is to be made to Section 194A of the Income Tax Act. The relevant provision of Section 194A(3)(ix) and(ixa) is quoted herein-below: "194A. (1) Any person not being an individual or a Hindu undivided family, who is responsible for paying to a resident any income by way of interest other than income [by way of interest on securities] shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rates in force: Provided that an individual or a Hindu undivided family, whose total sales, gross receipts or turnover from the business or profession carried on by him exceeds the monetary limits specified under clause(a) or clause(b) of section 44AB during the financial year immediately preceding the financial year in which such interest is credited or paid, shall be liable to deduct income-tax under this section. Explanation- For the purposes of this section, where any income by way of interest as aforesaid is credited to any account, whether called "Interest payable account", or "suspense account" or by any other name, in the books of account of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of the payee and the provisions of the section shall apply accordingly . O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 9 (3) The provisions of sub-section (1) shall not apply- .... (ix) to such income credited or paid by way of interest on the compensation amount awarded by the Motor Accidents Claims Tribunal where the amount of such income or, as the case may be, the aggregate of the amounts of such income credited or paid during the financial year does not exceed fifty thousand rupees." (ixa) to such income paid by way of interest on the compensation amount awarded by the Motor Accidents Claims Tribunal where the amount of such income or, as the case may be, the aggregate of the amounts of such income paid during the financial year does not exceed fifty thousand rupees; 11. A reading of the provisions above, it would be luculent that a statutory liability is cast upon the judgment debtor to deduct tax at source from the amount of interest payable on the total compensation awarded to a claimant, only if the interest exceeds Rs.50,000/-. In the case on hand, the interest element is less than Rs.50,000/-. In view of the clear prescription of law, the action on the part of the petitioner in deducting amount toward TDS cannot be sustained. The order passed by the Tribunal in O.P(MAC) 652/2011 therefore do not warrant any interference. However, insofar as W.P.(C) 31473/2009 is concerned, the records would reveal that an affidavit was filed by the officer concerned that the amount as ordered by the Tribunal would be deposited in terms of the attachment warrant and based on such undertaking, the attachment was lifted, and the vehicle which was attached was released. It was in the said 10 O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 circumstances that the Tribunal had ordered that the officer had violated the undertaking given before the Tribunal and ordered attachment of his salary by exercising its powers under Order XXI Rule 48 of CPC. It is not brought to the notice of this Court that the said order has been challenged by the officer concerned before any forum. In the facts and circumstances, I find no reason to interfere with the said order by exercising the discretionary powers under Article 226 of the Constitution of India. These petitions will stand dismissed. Sd/- **RAJA VIJAYARAGHAVAN V JUDGE** ``` Sru ``` 11 O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 ## `APPENDIX OF OP(MAC) 652/2011` ``` PETITIONER EXHIBITS ``` ``` EXHIBIT P1 ``` ``` TRUE COPY OF THE STATEMENT SUBMITTED AT THE TRIBUNAL BY THE PETIITONER. ``` ``` EXHIBIT P2TRUE COPY OF THE FORM 16A, A CERTIFICATE OF TAX DEDUCTED AS SOURCE FOR RS.26445/- DATED 10.12.10. ``` ``` EXHIBIT P3TRUE COPY OF THE FORM 16A, A CERTIFICATE OF TAX DEDUCTED AT SOURCE FOR RS.10315/- DATED 10.12.10. ``` ``` EXHIBIT P4TRUE COPY OF THE AUTHORISATION SLIP DATED 20.1.2011. ``` ``` EXHIBIT P5A TRUE COPY OF THE ORDER OF THE MACT IN EP 292/07 IN OP(MV) NO.391/99 DATED 14.2.11. ``` ``` EXHIBIT P6A TRUE COPY OF THE EXECUTION PETITION 292/07 IN OP(MV) NO.391/99 OF THE MACT, THIRUVANANTHAPURAM. ``` ``` RESPONDENTS EXHIBITS : NIL ``` 12 O.P(MAC) No.652/2011 &W.P.(C) No.31473/2009 ## `APPENDIX OF WPC 31473/2009` ``` PETITIONER EXHIBITS ``` ``` EXHIBIT P1TRUE COPY OF THE STATEMENT SUBMITTED AT THE TRIBUNAL BY THE PETITIONER. EXHIBIT P2TRUE COPY OF THE FORM 16A, A CERTIFICATE OF TAX DEDUCTED AT SOURCE. EXHIBIT P3TRUE COPY OF THE ORDER IN EP NO.457/2002 OF THE TRIBUNAL. EXHIBIT P4TRUE COPY OF THE ORDER OF ATTACHMENT DATED 14.7.09. ``` ``` RESPONDENTS EXHIBITS : NIL ```