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.

The Commissioner of Income Tax vs. N. Annapurna

ITTA/371/2005HC Telangana14 Mar 2016

Bench: RAMESH RANGANATHAN,M.SATYANARAYANA MURTHY

ACIT, New Delhi vs. M/S. C.J. International Hotels Ltd., New Delhi

In the result, the appeals of the assessee for both the

ITA 21/DEL/2015[2006-07 (F.Y.- 2005-06)]Status: DisposedITAT Delhi10 Mar 2016

Bench: Shri R.S. Syal, Am & Shri A.T. Varkey, Jm

For Appellant: Shri Tarandeep Singh, CA
Section 133ASection 192Section 194CSection 194JSection 201Section 201(1)

…on of the employer in deducting tax at source on such tips u/s 192 of the Act. At this juncture, we consider it expedient to discuss the judgment dt. 25th March, 2009 delivered by the Hon’ble Apex Court in CIT VS. Eli Lilly & Company (India) (P) Ltd. (2009) 312 ITR 225 (SC). In this case, the issue for consideration was about the home salary/special allowance(s) paid abroad to expatriate employees by the foreign company, particularly when no work stood performed for the foreign company and the total remuneration was paid only on account of services rendered in ITA Nos.21,22, 25&26/Del/2015 India during the…

ACIT, New Delhi vs. M/S. C.J. International Hotels Ltd., New Delhi

In the result, the appeals of the assessee for both the

ITA 5347/DEL/2011[2006-07 (F.Y. 2005-06)]Status: DisposedITAT Delhi10 Mar 2016

Bench: Shri R.S. Syal, Am & Shri A.T. Varkey, Jm

For Appellant: Shri Tarandeep Singh, CA
Section 133ASection 192Section 194CSection 194JSection 201Section 201(1)

…on of the employer in deducting tax at source on such tips u/s 192 of the Act. At this juncture, we consider it expedient to discuss the judgment dt. 25th March, 2009 delivered by the Hon’ble Apex Court in CIT VS. Eli Lilly & Company (India) (P) Ltd. (2009) 312 ITR 225 (SC). In this case, the issue for consideration was about the home salary/special allowance(s) paid abroad to expatriate employees by the foreign company, particularly when no work stood performed for the foreign company and the total remuneration was paid only on account of services rendered in ITA Nos.21,22, 25&26/Del/2015 India during the…

M/S. Cj International Hotels Ltd., New Delhi vs. Addl. CIT, New Delhi

In the result, the appeals of the assessee for both the

ITA 4791/DEL/2011[2006-07 (F.Y. 2005-06)]Status: DisposedITAT Delhi10 Mar 2016

Bench: Shri R.S. Syal, Am & Shri A.T. Varkey, Jm

For Appellant: Shri Tarandeep Singh, CA
Section 133ASection 192Section 194CSection 194JSection 201Section 201(1)

…on of the employer in deducting tax at source on such tips u/s 192 of the Act. At this juncture, we consider it expedient to discuss the judgment dt. 25th March, 2009 delivered by the Hon’ble Apex Court in CIT VS. Eli Lilly & Company (India) (P) Ltd. (2009) 312 ITR 225 (SC). In this case, the issue for consideration was about the home salary/special allowance(s) paid abroad to expatriate employees by the foreign company, particularly when no work stood performed for the foreign company and the total remuneration was paid only on account of services rendered in ITA Nos.21,22, 25&26/Del/2015 India during the…

DCIT 7(3), Mumbai vs. Zodiac Clothing Co.Ltd, Mumbai

In the result, the appeal filed by the revenue is dismissed

ITA 3973/MUM/2014[2009-10]Status: DisposedITAT Mumbai04 Mar 2016AY 2009-10

Bench: S/Shri B.R.Baskaran & Shri Sandeep Gosainआयकर अपीऱ सं./I.T.A. No.3973/Mum/2014 (निर्धारण वर्ा / Assessment Year :2009-10)

For Appellant: Ms.Anu K AggarwalFor Respondent: Mrs.Vasanti B Patel
Section 195Section 195(2)Section 40

…d, were made in that context. In our view too, the said decision by the apex court, which we find to be in consonance with the decisions rendered earlier, as in CIT v. Cooper Engg. Ltd. [1968] 68 ITR 457 (Bom.); CIT v. Eli Lilly & Co. (India) (P.) Ltd. [2009] 312 ITR 225/178 Taxman 505 (SC); Vijay Ship Breaking Corpn. v. CIT[2009] 314 ITR 309/[2008] 175 Taxman 77 (SC) and, rather Transmission Corpn. of A.P. Ltd. (supra) as well, squarely covers the facts of the instant case. The Revenue, to enable us to disturb the like finding by the ld. CIT(A), ought to have explained as to how it is infirm or does not amount t…

Boscj Limited, Bangalore vs. DCIT, Bangalore

In the result, the appeal filed by the assessee company is treated as

ITA 1583/BANG/2014[2012-13]Status: DisposedITAT Bangalore01 Mar 2016AY 2012-13

Bench: Smt Asha Vijayaraghavan & Shri Inturi Rama Rao

For Appellant: Shri K.P.Kumar, Sr. CounselFor Respondent: Smt. Rukmani Attri, JCIT
Section 195Section 201(1)Section 40Section 95

…d in that section. While interpreting the provisions of the Income Tax Act one cannot read the charging sections of that Act de hors the machinery sections. The Act is to be read as an integrated code. Section 195 ITA No.1583(B)/2014 (India) (P) Ltd. (2009) 312 ITR 225 the provisions for deduction of TAS which are in Chapter XVII dealing with collection of taxes and the charging provisions of the Income Tax Act form one single integral, inseparable code and, therefore, the provisions relating to TDS apply only to those sums which are “ chargeable to tax” under the Income-Tax Act. It is true that the judgment in…

Central Electronics Ltd., Uttar Pradesh vs. DCIT, New Delhi

In the result, the appeal of the assessee is allowed

ITA 207/DEL/2014[2010-11]Status: DisposedITAT Delhi24 Feb 2016AY 2010-11

Bench: Smt. Diva Singh & Sh. O.P. Kantassessment Year: 2010-11 Ddit, Circle-3(1), 3Rd Floor, C.R. Central Electronics Ltd., 4, Vs. Industrial Area, Sahibabad, Uttar Building, I.P. Estate, New Delhi Pradesh. (Pan:Aaacc1262G) (Appellant) (Respondent)

Section 143(2)Section 143(3)Section 195Section 40Section 42Section 43BSection 9(1)(vii)

…considering the Circulars issued by the CBDT and judgments of various High Courts and Supreme Court, held as under: “…………………………………. In the light of the judgments of the Supreme Court in Commissioner of Income Tax Vs. Eli Lilly and Co. (India) P. Ltd. [2009], 312 ITR 225 (SC) and GE India Technology Centre P. Ltd. Vs. Commissioner of Income Tax [2010] 327 ITR 456 (SC), once the income was not exigible or chargeable to tax, TDS was not required to be deducted. Money paid to the third parties, who did not have any office or permanent establishment in India, was exempt and not chargeable to tax. Thus, on the said pa…

M/S Wipro Ltd vs. ITO

In the result, the appeals of the assessee are allowed and S

ITA 1544/BANG/2013[2010-11]Status: DisposedITAT Bangalore12 Feb 2016AY 2010-11

Bench: Shri Abraham P George & Shri Vijaypal Rao

For Appellant: Shri B.K. Manjunatha, C.AFor Respondent: Shri Rajashekar, Addl. CIT (D.R)
Section 139ASection 156Section 200ASection 206ASection 90(2)Section 90A(2)

…h casts a duty on the assessee to deduct tax at source on payments to a non-resident cannot be looked upon as a charging provision. In-fact, in the context of section 195 of the Act also, the Hon’ble Supreme Court in the case of CIT vs. Eli Lily & Co., (2009) 312 ITR 225 (SC) observed that the provisions of tax withholding i.e. section 195 of the Act would apply only to sums which are otherwise chargeable to tax under the Act. The Hon’ble Supreme Court in the case of GE India Technology Centre Pvt. Ltd. vs. CIT, (2010) 327 ITR 456 (SC) held that the provisions of DTAAs along with the sections 4, 5, 9, 90 & 91 of…

ACIT, Circle - 52, Kolkata vs. Shri Subhotosh Majumdar, Kolkata

In the result, the appeals of revenue are dismissed

ITA 366/KOL/2012[2008-09]Status: DisposedITAT Kolkata27 Nov 2015AY 2008-09

Bench: Shri Mahavir Singh, Jm & Shri M. Balaganesh, Am]

For Appellant: Shri S. Srivastava, CITFor Respondent: Shri J. P. Khaitan, Advocate
Section 143(3)Section 195Section 40Section 5Section 9Section 9(1)(i)

…ssee was in default and had failed to deduct at source, though it was mandated and required. The respondent was entitled to rely upon the circulars. In light of the judgments of the Supreme Court in CIT versus Eli Lilly Company (India) Private Limited, (2009) 312 ITR 225 (SC) and G.E India Technologies Centre Private Limited versus CIT, (2010) 327 ITR 456 (SC), once the income was not exigible or chargeable to tax, TDS was not required to be deducted. Money paid to the third parties, who did not have any office or permanent establishment in India, was exempt and not chargeable to tax. Thus on the said payments or…

DCIT, Circle-52, Kolkata vs. Sri Subhotosh Majumder . S. Jamumbder &Co, Kolkata

In the result, the appeals of revenue are dismissed

ITA 1629/KOL/2012[2009-10]Status: DisposedITAT Kolkata27 Nov 2015AY 2009-10

Bench: Shri Mahavir Singh, Jm & Shri M. Balaganesh, Am]

For Appellant: Shri S. Srivastava, CITFor Respondent: Shri J. P. Khaitan, Advocate
Section 143(3)Section 195Section 40Section 5Section 9Section 9(1)(i)

…ssee was in default and had failed to deduct at source, though it was mandated and required. The respondent was entitled to rely upon the circulars. In light of the judgments of the Supreme Court in CIT versus Eli Lilly Company (India) Private Limited, (2009) 312 ITR 225 (SC) and G.E India Technologies Centre Private Limited versus CIT, (2010) 327 ITR 456 (SC), once the income was not exigible or chargeable to tax, TDS was not required to be deducted. Money paid to the third parties, who did not have any office or permanent establishment in India, was exempt and not chargeable to tax. Thus on the said payments or…

ACIT, Circle - 52, Kolkata vs. Shri Subhotosh Majumder, Kolkata

In the result, the appeals of revenue are dismissed

ITA 2058/KOL/2009[2006-07]Status: DisposedITAT Kolkata27 Nov 2015AY 2006-07

Bench: Shri Mahavir Singh, Jm & Shri M. Balaganesh, Am]

For Appellant: Shri S. Srivastava, CITFor Respondent: Shri J. P. Khaitan, Advocate
Section 143(3)Section 195Section 40Section 5Section 9Section 9(1)(i)

…ssee was in default and had failed to deduct at source, though it was mandated and required. The respondent was entitled to rely upon the circulars. In light of the judgments of the Supreme Court in CIT versus Eli Lilly Company (India) Private Limited, (2009) 312 ITR 225 (SC) and G.E India Technologies Centre Private Limited versus CIT, (2010) 327 ITR 456 (SC), once the income was not exigible or chargeable to tax, TDS was not required to be deducted. Money paid to the third parties, who did not have any office or permanent establishment in India, was exempt and not chargeable to tax. Thus on the said payments or…

ITO, Faridabad vs. M/S Mitsubishi Heavy Industries Ltd., Faridabad

In the result, the appeal filed by the Revenue is dismissed

ITA 2915/DEL/2011[2009-10 (F.Y. 2008-09)]Status: DisposedITAT Delhi30 Oct 2015

Bench: Shri Inturi Rama Rao & Shri Sudhanshu Srivastavaassessment Year: 2009-10 Income Tax Officer, Vs. Mitsubishi Heavy Industries Ltd., Tds Ward, Faridabad 12/4, Mathura Road, Faridabad (Pan: Aaacm1432F) (Appellant) (Respondent) Appellant By : Sh. P. Dam Kanunjna, Sr. Dr Respondent By : Sh. Deepak Chopra & Ms. Ananya Kapoor, Advocates Date Of Hearing: 08.10.2015 Date Of Pronouncement: 30.10.2015 Order Per Inturi Rama Rao, A.M.: This Appeal Filed By The Revenue Is Directed Against The Order Of Ld. Cit(A), Dated 14.03.2011 Passed For The Assessment Year 2009-10. The Revenue Raised The Following Grounds Of Appeal: I. On The Facts & In The Circumstances Of The Case, The Ld. Cit(A) Erred In Facts & Law In Deleting The Penalty As Tax Deductor Continued Deducting The Tax, But Failed To Deposit The Same Into The Central Govt. Account Within The Stipulated Time. Ii. On The Facts & In The Circumstances Of The Case, The Finding Of Ld. Cit(A) Deleting The Penalty On The Ground That The Tax Deductor Was Ignorant Of Indian Tax Laws Is Not Correct As It Took The Tax Deductor More Than One Year To Understand & Comply With The Indian Tax Laws. Iii. That The Appellant Craves For The Permission To Add, Delete Or Amend The Grounds Of Appeal Before Or At The Time Of Hearing Of The Appeal. 2. The Brief Facts Of The Case Are As Follows:

For Appellant: Sh. P. DAM Kanunjna, Sr. DRFor Respondent: Sh. Deepak Chopra & Ms. Ananya Kapoor, Advocates
Section 201

…making payment in their country or by their joint venture partners in India. In the context of provisions of section 192 read with section 9 of the Act vis-a-vis the deduction of tax at source, the Hon 'ble Apex court in the case of CIT vs. Eli Lilly and Co. (312 ITR 225) has held that this was the first instance' that such an issue was examined by the Court. The Hon'ble Court also went ahead in holding that where the tax deductor was under a genuine and bonafide belief that it was not under an obligation to withhold taxes, there was no question of imposition of penalty as the assessees had been able to discharge…

Director of Income Tax vs. M/S Ericsson Communications Ltd

The appeal is dismissed

ITA/106/2002HC Delhi04 Sept 2015
For Appellant: Mr Rohit Madan and Mr Zoheb HossainFor Respondent: Mr M.S. Syali, Sr. Advocate with Mr Mayank
Section 195Section 201Section 23Section 260A

…g provisions of the Income-tax Act from one single integral, inseparable code and, therefore, the provisions relating to TDS apply only to those sums which are “chargeable to tax” under the Income tax Act. It is true that the judgment in Eli Lilly [2009] 312 ITR 225 was similarity between the two. If one looks at section 192 one finds that it imposes statutory obligation on the payer to deduct TAS when he pays any income “chargeable under the head salaries”. Similarly, section 195 imposes a statutory obligation on any person responsible for paying to a non-resident any sum “chargeable under the provi…

Dy DIT vs. M/S Infosys Bpo Ltd

In the result, all the appeals of the revenue and the cross

ITA 1143/BANG/2013[2011-12]Status: DisposedITAT Bangalore29 Jun 2015AY 2011-12

Bench: Shri Vijay Pal Rao & Shri Jason P Boaz

For Respondent: Dr. P.K.Srihari, Addl.CIT
Section 115ASection 200A(1)Section 200A(1)(b)Section 206ASection 246A

…h casts a duty on the assessee to deduct tax at source on payments to a non-resident cannot be looked upon as a charging provision. In-fact, in the context of section 195 of the Act also, the Hon’ble Supreme Court in the case of CIT vs. Eli Lily & Co., (2009) 312 ITR 225 (SC) observed that the provisions of tax withholding i.e. section 195 of the Act would apply only to sums which are otherwise chargeable to tax under the Act. The Hon’ble Supreme Court in the case of GE India Technology Centre Pvt. Ltd. vs. CIT, (2010) 327 ITR 456 (SC) held that the provisions of DTAAs along with the sections 4, 5, 9, 90 & 91 of…

Broadcom India Research Private Limited, Bangalore vs. DCIT, Bangalore

In the result the appeal by the Assessee is partly allowed

ITA 1180/BANG/2011[2007-08]Status: DisposedITAT Bangalore28 Jan 2015AY 2007-08

Bench: Shri N.V. Vasudevan & Shri Abraham P. George

For Appellant: Shri Sreeram Seshadri, AdvocateFor Respondent: Shri.C.H. Sundar Rao, CIT-I (DR)
Section 143(3)Section 92Section 92C

…06 to March, 2007 admitted were not paid to the non-resident and therefore the same cannot be brought to tax in India. Since the obligation to deduct tax is linked to chargeability to tax in the hands of the non-resident as held in the case of Eli Lilly & Co. 312 ITR 225 (SC), it was submitted by him that there was no obligation to deduct tax at source and consequently no disallowance could be made u/s.40(a)(i) of the Act. 42. The learned DR submitted that none of the decisions on which reliance was placed by the learned counsel for the Assessee are in the context of obligation to deduct tax at source u/s.195 of…

Director of Income Tax International Taxation vs. Ge Packaged Power Inc

ITA/352/2014HC Delhi12 Jan 2015

…ions 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. v. Eli Lilly & Co. (India) (P.) Ltd. [MANU/SC/0487/2009 : 312 ITR 225) the previsions 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…

Commissioner of Income Tax-I vs. Angelique International Ltd

ITA/280/2013HC Delhi23 Sept 2013
Section 260ASection 40Section 5Section 5(2)Section 9Section 9(1)(i)Section 9(1)(vii)

…as in default and had failed to deduct at source, though it was mandated and required. The respondent was entitled to rely upon the circulars. In light of the judgments of the Supreme Court in CIT versus Eli Lilly Company (India) Private Limited, (2009) 312 ITR 225 (SC) and G.E India Technologies Centre Private Limited versus CIT, (2010) 327 ITR 456 (SC), once the income was not exigible or chargeable to tax, TDS was not required to be deducted. Money paid to the third parties, who did not have any office or permanent establishment in India, was exempt and not chargeable to tax. Thus on the said paym…

M\S.Chennakesava Vijayawada vs. The Commissioner of Income Tax Vijayawad

ITTA/33/2000HC Telangana27 Aug 2012

Bench: GODA RAGHURAM,M.S.RAMACHANDRA RAO

CIT vs. Japan Airlines International Co Ltd

ITA/305/2011HC Delhi15 Jul 2011

Bench: HON'BLE MR. JUSTICE A.K.SIKRI,HON'BLE MR. JUSTICE M.L. MEHTA

Section 192Section 271Section 271CSection 271C(1)(a)Section 273

…e head "salary" was a nascent issue at the relevant time. Law on this aspect was in fluid situation and there was no clear cut authority/ pronouncements on this aspect. This is observed by the Apex Court itself in CIT Vs. Eli Lilly & Co. (India) (P) Ltd. 312 ITR 225. In that .... - ... - .. -._.---_._. __ ........ - case also, on identical circumstances, in this very ground, the SupremE!! Court upheld the deletion of penalty imposed under Section 271 (c) of Act. The relevant observations of the Supreme Court discussing this aspect is as follows:- "(iv) On the Scope of Section 271C read with Section 2…

CIT vs. Japan Airlines International Co Ltd

ITA - 298 / 2011HC Delhi15 Jul 2011
Section 192Section 271Section 271CSection 271C(1)(a)Section 273BSection 40

…er the head "salary" was a nascent issue at the relevant time. Law on this aspect was in fluid situation and there was no clear cut authority/ pronouncements on this aspect. This is observed by the Apex Court itself in CIT Vs. Eli Lilly & Co. (India) (P) Ltd. 312 ITR 225. In that ![](_page_2_Picture_1.jpeg) case also, on identical circumstances, in this very ground, the Supreme Court upheld the deletion of penalty imposed under Section 271 (c) of Act. The relevant observations of the Supreme Court discussing this aspect is as follows:- "(iv) On the Scope of Section 271C read with Section 273B: Section 271C in…