The Delhi High Court in a landmark decision in  452 ITR 107 (Del) provided relief to an ex-kingfisher airlines employee in whose case taxes are deducted by the employer who defaulted in deposit of such TDS with the government.
The Court prevented the department from recovering such TDS as well as also called upon the department not to make any adjustment of such amounts from any refunds due and payable in future.
The revenue plea that since the withholding tax amount is not reflected in form 26AS, the demand shall remain outstanding and that it cannot be effaced is not acceded to by the Court who quashed the demand notice in this case.
This has been a case of kingfisher employee who is a well know defaulter. Like this there are several others in Or out of NCLT forums, ED , CBI investigations etcetera where the affected employees may take shelter from this decision in delhi ncr jurisdiction without having to go into a writ course.
Duty of Revenue
Taking cue from this decision the revenue may self identify similar nature of frivolous demands in case of salaried employees where their employer in the corresponding have defaulted in deposit of TDS based on which the demands pending against employees be kept in abeyance or written off, as the case may be to protect refunds due and payable in future.