CIT v. Eli Lily & Co.

312 ITR 225Supreme Court of India2009#403 most cited

What is CIT v. Eli Lily & Co. authority for?

Section 195 of the Income Tax Act, which mandates tax withholding on payments to non-residents, applies only to sums that are otherwise chargeable to tax under the Act. Tax withholding provisions are not charging provisions.

221

judgments rely on this decision, according to BharatTax’s citation analysis of 371,239 Indian tax judgments — from 2011 to 2026.

Also referred to as

CIT v. Eli Lily & Co. · section 195 · TDS · tax withholding · chargeable to tax · non-resident payments · not a charging provision · GE India Technology Centre Pvt. Ltd. v. CIT

Sections most often in play

Section 143(3)Section 153ASection 269SSSection 271DSection 275(1)(c)Section 273BSection 194CSection 132

Issues it is cited on

section 271csection 192section 156assessee in defaultsection 273bsection 271dsection 201(1)section 201(1a)section 195section 19section 201section 194

Judgments citing CIT v. Eli Lily & Co.

Aurora Educational Society, Hyderabad vs. ACIT., Central Circle 2(4), Hyderabad

In the result, the appeal filed by the assessee in ITA

ITA 1257/HYD/2025[2018-19]Status: DisposedITAT Hyderabad27 Mar 2026AY 2018-19
Section 11Section 132Section 143(3)Section 153ASection 254Section 269Section 269SSection 271D

…ered view, provisions of sec.271D of the Act, is not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee to exempt from penalty. The Hon’ble Supreme Court in the case of CIT vs., M/s. Eli Lilly and Company (India) Private Limited, [2009] 312 ITR 225 (SC) held that, penalty provision, such as sec.271C r.w.s.273B of the Act are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee from penalty. The Hon'ble Supreme Court observed that, “where a tax payer acts under a bonafide belief or in a situation where the legal position is un-settled and there is no intention to eva…

Aurora Educational Society, Hyderabad vs. DCIT., Central Circle 2(4), Hyderabad

In the result, the appeal filed by the assessee in ITA

ITA 1256/HYD/2025[2017-18]Status: DisposedITAT Hyderabad27 Mar 2026AY 2017-18
Section 11Section 132Section 143(3)Section 153ASection 254Section 269Section 269SSection 271D

…ered view, provisions of sec.271D of the Act, is not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee to exempt from penalty. The Hon’ble Supreme Court in the case of CIT vs., M/s. Eli Lilly and Company (India) Private Limited, [2009] 312 ITR 225 (SC) held that, penalty provision, such as sec.271C r.w.s.273B of the Act are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee from penalty. The Hon'ble Supreme Court observed that, “where a tax payer acts under a bonafide belief or in a situation where the legal position is un-settled and there is no intention to eva…

Aurora Educational Society, Hyderabad vs. ACIT., Central Circle 2(4), Hyderabad

In the result, the appeal filed by the assessee in ITA

ITA 1255/HYD/2025[2016-17]Status: DisposedITAT Hyderabad27 Mar 2026AY 2016-17
Section 11Section 132Section 143(3)Section 153ASection 254Section 269Section 269SSection 271D

…ered view, provisions of sec.271D of the Act, is not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee to exempt from penalty. The Hon’ble Supreme Court in the case of CIT vs., M/s. Eli Lilly and Company (India) Private Limited, [2009] 312 ITR 225 (SC) held that, penalty provision, such as sec.271C r.w.s.273B of the Act are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee from penalty. The Hon'ble Supreme Court observed that, “where a tax payer acts under a bonafide belief or in a situation where the legal position is un-settled and there is no intention to eva…

ACIT, Circle-2(1)(1), Agra vs. Emco Exports, Agra

In the result, revenue’s appeal stands dismissed

ITA 415/AGR/2025[2020-21]Status: DisposedITAT Agra15 Jan 2026AY 2020-21

Bench: : Shri S. Rifaur Rahman & Shri Sunil Kumar Singhassessment Year: 2020-21

Section 195Section 250Section 40Section 9

…d the charging Sections of that Act de hors the machinery Sections. The Act is to be read as an integrated Code. Section 195 appears in Chapter XVII which deals with collection and recovery. As held in the case of C.I.T. Vs. Eli Lilly & Co. (India) (P.) Ltd. [312 ITR 225] the provisions for deduction of TAS which is in Chapter XVII dealing with collection of taxes and the charging provisions of the I.T. Act form one single integral, inseparable Code and, therefore, the provisions relating to TDS applies only to those sums which are “chargeable to tax” under the I.T. Act. It is true that the judgment in Eli Lilly…

Maruti Suzuki India Ltd., New Delhi vs. DCIT, New Delhi

In the result, all the three appeals of the assessee are allowed as indicated above and the appeal of Revenue is partly allowed

ITA 901/DEL/2017[2012-13]Status: DisposedITAT Delhi08 Oct 2025AY 2012-13

Bench: Shris.Rifaur Rahman & Shri Vimal Kumar

For Appellant: Shri Ajay Vohra, Sr. AdvocateFor Respondent: Shri G.C. Srivastava, Spl. Counsel for the Department
Section 143(3)Section 144CSection 144C(1)Section 144C(5)Section 14ASection 32Section 35Section 43B

…foreign jurisdiction, retain lien on employment, so that the employee reverts to the parent jurisdiction after the deputation term. Reference is made in this regard to the decision of the Supreme Court in the case of CIT vs Eli Lilly and Co. India (P) Ltd. : 312 ITR 225, wherein the Court held as follows: “It cannot be stated as a broad proposition that the TDS provisions which are in the nature of machinery provisions to enable collection and recovery of tax are independent of the charging provisions which determines the assessability in the hands of the employee-assessee. Secondly, whether the Home Salary paym…

DCIT, New Delhi vs. M/S. Maruti Suzuki India Ltd., New Delhi

In the result, all the three appeals of the assessee are allowed as indicated above and the appeal of Revenue is partly allowed

ITA 1024/DEL/2016[2011-12]Status: DisposedITAT Delhi08 Oct 2025AY 2011-12

Bench: Shris.Rifaur Rahman & Shri Vimal Kumar

For Appellant: Shri Ajay Vohra, Sr. AdvocateFor Respondent: Shri G.C. Srivastava, Spl. Counsel for the Department
Section 143(3)Section 144CSection 144C(1)Section 144C(5)Section 14ASection 32Section 35Section 43B

…foreign jurisdiction, retain lien on employment, so that the employee reverts to the parent jurisdiction after the deputation term. Reference is made in this regard to the decision of the Supreme Court in the case of CIT vs Eli Lilly and Co. India (P) Ltd. : 312 ITR 225, wherein the Court held as follows: “It cannot be stated as a broad proposition that the TDS provisions which are in the nature of machinery provisions to enable collection and recovery of tax are independent of the charging provisions which determines the assessability in the hands of the employee-assessee. Secondly, whether the Home Salary paym…

Nimmatoori Ramesh Babu, Hyderabad vs. ACIT., Central Circle 2(4), Hyderabad

In the result, appeal ITA

ITA 597/HYD/2025[2017-18]Status: DisposedITAT Hyderabad12 Sept 2025AY 2017-18

Bench: Shri Manjunatha G & Shri Ravish Sood

For Respondent: Sri Posu Babu Alli, Sr. AR
Section 143(3)Section 269Section 271Section 271DSection 271D(2)Section 273BSection 4

…red view, provisions of sec.271D of the Act, are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee to exempt from penalty. The Hon’ble Supreme Court in the case of CIT vs., M/s. Eli Lilly and Company (India) Private Limited, [2009] 312 ITR 225 (SC) held that, penalty provision, such as sec.271C read with section 273B of the Act are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee from penalty. The Supreme Court observed that, “where a 26 ITA.Nos.594, 596 & 597 /Hyd./2025 tax payer acts under a bonafide belief or in a situation where the legal position is un…

Late Nimmatoori Rajababu L/R by Anudeep Nimmatoori, Hyderabad vs. ACIT., Central Circle 2(4), Hyderabad

In the result, appeal ITA

ITA 596/HYD/2025[2017-18]Status: DisposedITAT Hyderabad12 Sept 2025AY 2017-18

Bench: Shri Manjunatha G & Shri Ravish Sood

For Respondent: Sri Posu Babu Alli, Sr. AR
Section 143(3)Section 269Section 271Section 271DSection 271D(2)Section 273BSection 4

…red view, provisions of sec.271D of the Act, are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee to exempt from penalty. The Hon’ble Supreme Court in the case of CIT vs., M/s. Eli Lilly and Company (India) Private Limited, [2009] 312 ITR 225 (SC) held that, penalty provision, such as sec.271C read with section 273B of the Act are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee from penalty. The Supreme Court observed that, “where a 26 ITA.Nos.594, 596 & 597 /Hyd./2025 tax payer acts under a bonafide belief or in a situation where the legal position is un…

Nimmatoori Sulochana, Hyderabad vs. ACIT., Central Circle 2(4), Hyderabad

In the result, appeal of the assessee is allowed

ITA 603/HYD/2025[2017-18]Status: DisposedITAT Hyderabad10 Sept 2025AY 2017-18

Bench: Shri Vijay Pal Rao & Shri Manjunatha G

For Appellant: CA, P. Murali Mohan RaoFor Respondent: Sri Siva Prasad SV, Sr. AR
Section 143(3)Section 269Section 271Section 271DSection 271D(2)Section 273B

…view, the provisions of sec.271D of the Act are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee to exempt from penalty. The Hon’ble Supreme Court in the case of CIT vs., M/s. Eli Lilly and Company (India) Private Limited, [2009] 312 ITR 225 (SC) held that, penalty provision, such as sec.271C read with section 273B of the Act are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee from penalty. The Supreme Court observed that, “where a tax payer acts under a bonafide belief or in a situation where the legal position is un-settled and there is no intention to…

Nimmatoori Yashoda, Hyderabad vs. DCIT., Central Circle 2(4), Hyderabad

In the result, appeal of the assessee is allowed

ITA 602/HYD/2025[2017-18]Status: DisposedITAT Hyderabad10 Sept 2025AY 2017-18

Bench: Shri Vijay Pal Rao & Shri Manjunatha G

For Appellant: CA, P. Murali Mohan RaoFor Respondent: Sri Siva Prasad SV, Sr. AR
Section 143(3)Section 269Section 271Section 271DSection 271D(2)Section 273B

…view, the provisions of sec.271D of the Act are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee to exempt from penalty. The Hon’ble Supreme Court in the case of CIT vs., M/s. Eli Lilly and Company (India) Private Limited, [2009] 312 ITR 225 (SC) held that, penalty provision, such as sec.271C read with section 273B of the Act are not automatic and the exceptions of ‘reasonable cause’ exonerates an assessee from penalty. The Supreme Court observed that, “where a tax payer acts under a bonafide belief or in a situation where the legal position is un-settled and there is no intention to…

Commissioner of Income Tax -TDS-01 vs. Bose Corporation India Pvt. Ltd

The appeal of the assessee is allowed

ITA/261/2025HC Delhi01 Aug 2025

Bench: HON'BLE MR. JUSTICE V. KAMESWAR RAO,HON'BLE MR. JUSTICE VINOD KUMAR

Section 194Section 194CSection 201(1)

…efore, such tax cannot be recovered from the Appellant. 11. That on the facts and in the circumstances of the case and in law, the Ld. CIT (A) has vehemently ignored the law laid down by the Hon'ble Supreme Court in CIT Vs Eily Lilly & Co Pvt. Ltd. (2007) 312 ITR 225 (SC) and reiterated by Hon'ble Mumbai ITAP in ICICI Securities Limited, ITA No. 1511/ Mum /2022 that "the liability of deducting tax at source is in the nature of a vicarious liability, which pre-supposes existence of primary liability. The said liability is a vicarious liability and the principal liability is of the person who is taxable ..…

Commissioner of Income Tax -TDS-01 vs. Bose Corporation India Pvt. Ltd

The appeal of the assessee is allowed

ITA - 261 / 2025HC Delhi01 Aug 2025
Section 194Section 194CSection 201(1)

…efore, such tax cannot be recovered from the Appellant. 11. That on the facts and in the circumstances of the case and in law, the Ld. CIT (A) has vehemently ignored the law laid down by the Hon'ble Supreme Court in CIT Vs Eily Lilly & Co Pvt. Ltd. (2007) 312 ITR 225 (SC) and reiterated by Hon'ble Mumbai ITAP in ICICI Securities Limited, ITA No. 1511/ Mum /2022 that "the liability of deducting tax at source is in the nature of a vicarious liability, which pre-supposes existence of primary liability. The said liability is a vicarious liability and the principal liability is of the person who is taxable ..…

State Bank of India (Earlier Known As Sbbj), Ajmer vs. Income Tax Officer(TDS), Ajmer

In the result, appeal of the assessee is allowed for statistical purposes

ITA 173/JPR/2025[2017-18]Status: DisposedITAT Jaipur27 May 2025AY 2017-18
For Appellant: Mrs. Apeksha Kalra, AdvocateFor Respondent: Shri Gautam Singh Choudhary, Addl. CIT-DR
Section 142Section 201Section 201(1)Section 250(6)Section 253(5)Section 292BSection 5

…ascertain whether the deductee has discharged their tax liability before treating the ductor as an assessee-in-default. This principle has been upheld in various judicial pronouncements. Key Judicial Precedents: CIT v. Eli Lilly & Co. (India) Pvt. Ltd. (2009) 312 ITR 225 (SC): Facts: The AO initiated proceedings under Section 201 against the deductor without verifying if the deductees had paid taxes on the income received. Held: The Supreme Court emphasized that the liability of the deductor under Section 201(1) is not automatic. The AO must verify whether taxes have been paid by the deductees. If the deductees h…

Bhupendra Bora, Ghaziabad vs. DCIT, Dehradun

In the result, the appeal is allowed

ITA 230/DDN/2024[2019-20]Status: DisposedITAT Dehradun02 Apr 2025AY 2019-20

Bench: Shri M. Balaganesh & Shri Satbeer Singh Godara(Through Video Conferencing) Bhupendra Bora, Vs. Dcit, Flat No. S4, Plot No. 618A, Circle-1(1)(1), Sector-1, Vaishali, Dehradun Ghaziabad (Appellant) (Respondent) Pan: Ajkpb5486A Assessee By : None Revenue By: Shri A. S. Rana, Sr. Dr Date Of Hearing 17/03/2025 Date Of Pronouncement 02/04/2025

For Appellant: NoneFor Respondent: Shri A. S. Rana, Sr. DR
Section 139(1)Section 139(4)Section 143(1)Section 192Section 90

…THE INCOME TAX APPELLATE TRIBUNAL DEHRADUN BENCH, NEW DELHI BEFORE SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER (Through Video Conferencing) Bhupendra Bora, Vs. DCIT, Flat No. S4, Plot No. 618A, Circle-1(1)(1), Sector-1, Vaishali, Dehradun Ghaziabad (Appellant) (Respondent) PAN: AJKPB5486A Assessee by : None Revenue by: Shri A. S. Rana, Sr. DR Date of Hearing 17/03/2025 Date of pronouncement 02/04/2025 O R D E R PER M. BALAGANESH, A. M.: 1. The appeal in ITA No. 230/DDN/2024 for AY 2019-20, arises out of the order of the ld Commissioner of Income Tax (Appeals)-2, Pune [he…

Pr. Commissioner of Income Tax- 9 vs. M/S Tata Power Delhi Distribution Ltd. (Formerly Known As M/S North Delhi Power Limited)

ITA/687/2019HC Delhi13 Jan 2025

Bench: CASES PERTAINING TO SPL.DIVISION BENCHES

Section 10Section 10(34)Section 115Section 115JSection 143(1)Section 143(2)Section 143(3)Section 260A

…gnature Not Verified ITA 687/2019 Page 11 of 25 Supreme Court in Commissioner of Income Tax v. Eli Lilly and Co. (India) P. Ltd: (2009) 312 ITR 225, which clarified that the failure of a computation provision implies the inapplicability of the charging section. 16. The assessee submitted that the Finance Act, 2012 introduced a substantive amendment to Section 115JB of the Act, granting electricity, banking, and insurance companies the option to prepare their profit and loss accounts e…

Bose Corporation India Private Limited, Gurugram, Haryana vs. Deputy Commissioner of Income Tax, Circle 73 (1), New Delhi

ITA 2004/DEL/2024[2016-17]Status: DisposedITAT Delhi05 Dec 2024AY 2016-17

Bench: Sh. Satbeer Singh Godara & Sh. M. Balaganeshita No. 2003/Del/2024 : Asstt. Year : 2013-14 Ita No. 2004/Del/2024 : Asstt. Year : 2016-17 Bose Corporation India Pvt. Ltd., Vs Acit, 1St Floor, Tower-A, Building No. 10, Circle-73(1), Dlf Cyber City, Dlf Phase-Ii, New Delhi-110092 Gurugram, Haryana-122002 (Appellant) (Respondent) Pan No. Aaacb3260A Assessee By : Dr. Sashwat Bajpai, Adv. Revenue By : Sh. Poojan Rana, Sr. Dr Date Of Hearing: 19.11.2024 Date Of Pronouncement: 05.12.2024 Order Per Satbeer Singh Godara: These Assessee’S Instant Two Appeals Ita Nos. 2003 & 2004/Del/2024, For Assessment Years 2013-14 & 2016-17, Arise Against The Cit(A)/Nfac, Bengaluru’S Common Orders Dated 29.02.2024 In Din & Order No. Itba/Apl/S/250/2023- 24/1061748591(1) & In Din & Order No. Itba/Apl/S/250/2023-24/1061768679(1), In Proceedings U/S 201(1A) & 201 Of The Income Tax Act, 1961 (In Short “The Act”).

For Appellant: Dr. Sashwat Bajpai, AdvFor Respondent: Sh. Poojan Rana, Sr. DR
Section 194Section 194CSection 201Section 201(1)

…therefore, such tax cannot be recovered from the Appellant. 11. That on the facts and in the circumstances of the case and in law, the Ld. CIT (A) has vehemently ignored the law laid down by the Hon'ble Supreme Court in CIT Vs Eily Lilly & Co Pvt. Ltd. (2007) 312 ITR 225 (SC) and reiterated by Hon'ble Mumbai ITAT in ICICI Securities Limited, ITA No. 1511/Mum/2022 that "the liability of deducting tax at source is in the nature of a vicarious liability, which pre-supposes existence of primary liability. The said liability is a vicarious liability and the principal liability is of the person who is taxable..........…

Bose Corporation India Private Limited, Gurugram, Haryana vs. Assistant Commissioner of Income Tax, Circle 73 (1), New Delhi

ITA 2003/DEL/2024[2013-14]Status: DisposedITAT Delhi05 Dec 2024AY 2013-14

Bench: Sh. Satbeer Singh Godara & Sh. M. Balaganeshita No. 2003/Del/2024 : Asstt. Year : 2013-14 Ita No. 2004/Del/2024 : Asstt. Year : 2016-17 Bose Corporation India Pvt. Ltd., Vs Acit, 1St Floor, Tower-A, Building No. 10, Circle-73(1), Dlf Cyber City, Dlf Phase-Ii, New Delhi-110092 Gurugram, Haryana-122002 (Appellant) (Respondent) Pan No. Aaacb3260A Assessee By : Dr. Sashwat Bajpai, Adv. Revenue By : Sh. Poojan Rana, Sr. Dr Date Of Hearing: 19.11.2024 Date Of Pronouncement: 05.12.2024 Order Per Satbeer Singh Godara: These Assessee’S Instant Two Appeals Ita Nos. 2003 & 2004/Del/2024, For Assessment Years 2013-14 & 2016-17, Arise Against The Cit(A)/Nfac, Bengaluru’S Common Orders Dated 29.02.2024 In Din & Order No. Itba/Apl/S/250/2023- 24/1061748591(1) & In Din & Order No. Itba/Apl/S/250/2023-24/1061768679(1), In Proceedings U/S 201(1A) & 201 Of The Income Tax Act, 1961 (In Short “The Act”).

For Appellant: Dr. Sashwat Bajpai, AdvFor Respondent: Sh. Poojan Rana, Sr. DR
Section 194Section 194CSection 201Section 201(1)

…therefore, such tax cannot be recovered from the Appellant. 11. That on the facts and in the circumstances of the case and in law, the Ld. CIT (A) has vehemently ignored the law laid down by the Hon'ble Supreme Court in CIT Vs Eily Lilly & Co Pvt. Ltd. (2007) 312 ITR 225 (SC) and reiterated by Hon'ble Mumbai ITAT in ICICI Securities Limited, ITA No. 1511/Mum/2022 that "the liability of deducting tax at source is in the nature of a vicarious liability, which pre-supposes existence of primary liability. The said liability is a vicarious liability and the principal liability is of the person who is taxable..........…

Tdi Infrastructure Limited, New Delhi vs. DCIT Circle 76(1), New Delhi

In the result, appeals of the assessee are allowed for statistical purposes

ITA 3398/DEL/2023[2015-16]Status: DisposedITAT Delhi11 Jun 2024AY 2015-16

Bench: Shri S. Rifaur Rahman & Ms. Madhumita Royi.T.A. Nos. 3398 & 3417/Del/2023 (Assessment Year : 2015-16) Tdi Infrastructure Ltd. Vs. Dcit 11, Vandana Building, Circle – 76(1) Upper Ground Floor, New Delhi Tolstoy Marg, Connaught Place, New Delhi-110 001 Pan : Aaaci 5799 P (Appellant) .. (Respondent)

For Appellant: Respondent byFor Respondent: Shri Amit Katoch, Sr. D.R
Section 194CSection 201Section 201(1)Section 263

…pearing for the parties, having regard to the facts and circumstances of the case, particularly, the order passed by the Hon’ble High Court following the judgment passed by the Hon’ble Apex Court in the matter of Eli Lilly & Co. (India) (P.) Ltd., reported in 312 ITR 225 (SC), we set aside the issue to the file of the Learned AO with the direction upon him to determine the quantum of default under Section 201(1) of the Act and interest payable under Section 201(1-A) of the Act having regard the observation made by the Hon’ble Delhi High Court as above and to pass a reasoned order. The Learned AR is further direct…

ACIT Circle 13(1), New Delhi vs. Lx Pantos India Private Limited, New Delhi

In the result, the appeal of the Revenue is dismissed

ITA 912/DEL/2023[2018-19]Status: DisposedITAT Delhi17 May 2024AY 2018-19

Bench: Shri Kul Bharat & Shri M.Balaganesh

Section 143(3)Section 195Section 40Section 9(1)Section 9(1)(i)

…tax at source on the entire sum paid by him to the recipient. Under section 195 of the Act, the obligation to deduct tax at source was attracted only when the payment was chargeable to tax in India. Hon'ble Supreme Court in the case of Elly Lilly Co. P. Ltd. 312 ITR 225 (SC) has held that the purpose of provisions for deduction of tax at source in Chapter XVII- B of the Income-tax Act, 1961 is to see that from the sum which is chargeable under section 4 for levy and collection of Indian tax, the payer should deduct tax at the rates if the amount is to be paid to non-resident. They are meant for tentative deducti…

ACIT Circle 13(1), New Delhi vs. Lx Pantos India Private Limited, New Delhi

In the result, the appeal of the Revenue is dismissed

ITA 911/DEL/2023[2017-18]Status: DisposedITAT Delhi17 May 2024AY 2017-18

Bench: Shri Kul Bharat & Shri M.Balaganesh

Section 143(3)Section 195Section 40Section 9(1)Section 9(1)(i)

…tax at source on the entire sum paid by him to the recipient. Under section 195 of the Act, the obligation to deduct tax at source was attracted only when the payment was chargeable to tax in India. Hon'ble Supreme Court in the case of Elly Lilly Co. P. Ltd. 312 ITR 225 (SC) has held that the purpose of provisions for deduction of tax at source in Chapter XVII- B of the Income-tax Act, 1961 is to see that from the sum which is chargeable under section 4 for levy and collection of Indian tax, the payer should deduct tax at the rates if the amount is to be paid to non-resident. They are meant for tentative deducti…