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“liable to tax”

Chapter I - PreliminarySection 2 - DefinitionsSection 2(29A)2,645 judgments

The decision most relied on for liable to tax is DIT v. NGC Network Asia LLC (313 ITR 187), cited in 144 judgments on BharatTax.

Leading authorities on liable to tax

DIT v. NGC Network Asia LLC
313 ITR 187 · 2009 · High Court
144
citing judgments

Where a duty is cast on the payer to deduct and pay tax at source under Section 195, the payee-assessee cannot be levied interest under Section 234B for failure to pay advance tax if the payer defaults on its TDS obligation. This principle may also extend to interest under Section 234C.

CIT v. Nestle India Ltd.
14 Taxmann 99 · 1983 · High Court
125
citing judgments

Club entrance fees, if incurred wholly and exclusively for business purposes, are allowable as revenue expenditure under Section 37(1). Furthermore, an order holding a deductor liable for TDS defaults under Section 201 must be preceded by an inquiry into the deductee's actual tax payment.

CIT v. Karnataka Power Corporation
247 ITR 268 · 2001 · Supreme Court
124
citing judgments

Income earned during the project construction stage, which has a direct nexus or is inextricably linked to the project's setting up, constitutes a capital receipt not liable to tax and reduces the project cost.

CIT v. Rasoi Ltd.
335 ITR 438 · 2011 · High Court
107
citing judgments

Sales tax subsidies and Industrial Promotion Assistance received under the West Bengal Incentive Scheme are capital receipts and therefore not liable to tax. The ruling clarifies the inapplicability of the Sahney Steel judgment to such subsidies.

(supra), Rama Bai v. CIT
181 ITR 408 · 1990 · Supreme Court
84
citing judgments

Interest received on delayed payment or enhanced compensation awarded under compulsory acquisition is a revenue receipt and is liable to income tax.

Bank Vs. ACIT (2005) 142 Taxman 98 (Kerala) (v) CIT(TDS) v. Director, DPS
115 ITD 411 · ITAT
81
citing judgments

The case is an authority regarding the conditions under which an assessee can be held liable, and orders confirmed, under Section 201(1) of the Income-tax Act for failure to deduct tax at source (TDS). It clarifies the circumstances for deeming an assessee to be in default for non-deduction or non-payment of TDS.

CIT v. Chaphalkar Brothers
351 ITR 309 · 2013 · High Court
77
citing judgments

A subsidy or incentive provided by the government for meeting capital expenditure, to achieve a national objective or public interest, is a capital receipt and thus not liable to income tax. The nature of the subsidy is determined by applying the 'purpose test'.

CIT v. Wipro Ltd. (
70 Taxmann.com 129 · Reported
77
citing judgments

Payments are liable for deduction of tax at source when they are in the nature of royalty. The withholding tax liability can be worked out by applying a proportion to the total remittance.

Judgments citing liable to tax

DCIT, Circle 3(4), Mumbai vs. Tata Consultancy Services Limited, Mumbai

In the result, appeals of both, revenue and assessee are partly

ITA 2245/MUM/2025[2016-17]Status: DisposedITAT Mumbai30 Dec 2025AY 2016-17

Bench: Shri Pawan Singh & Shri Girish Agrawal

For Appellant: Shri Porus Kaka, Sr. AdvocateFor Respondent: Shri Ajay Chandra, CIT DR
Section 92CSection 92C(3)

erred in holding that the commission paid to non-resident agents operating outside India was not liable to tax in India and hence assessee was not liable to deduct tax under section 195 of the Act, despite it being clearly held by the 12 ITA No. 1516/Mum/2025 and others Tata ... erred in holding that the commission paid to non-resident agents operating outside India was not liable to tax in India and hence assessee was not liable to deduct tax under section 195 of the Act, despite it being clearly held by the Assessing Officer that the commissions

DCIT, Circle 3 4, Mumbai vs. Tata Consultancy Services Limited, Mumbai

In the result, appeals of both, revenue and assessee are partly

ITA 2244/MUM/2025[2017-18]Status: DisposedITAT Mumbai30 Dec 2025AY 2017-18

Bench: Shri Pawan Singh & Shri Girish Agrawal

For Appellant: Shri Porus Kaka, Sr. AdvocateFor Respondent: Shri Ajay Chandra, CIT DR
Section 92CSection 92C(3)

erred in holding that the commission paid to non-resident agents operating outside India was not liable to tax in India and hence assessee was not liable to deduct tax under section 195 of the Act, despite it being clearly held by the 12 ITA No. 1516/Mum/2025 and others Tata ... erred in holding that the commission paid to non-resident agents operating outside India was not liable to tax in India and hence assessee was not liable to deduct tax under section 195 of the Act, despite it being clearly held by the Assessing Officer that the commissions

Tata Consultancy Services Limited, Mumbai vs. Deputy Commissioner of Incometax 3(4), Mumbai

In the result, appeals of both, revenue and assessee are partly allowed for all the three assessment years

ITA 1518/MUM/2025[2018-19]Status: DisposedITAT Mumbai30 Dec 2025AY 2018-19

Bench: Shri Pawan Singh & Shri Girish Agrawal

For Appellant: Shri Porus Kaka, Sr. Advocate and Shri Manish Kumar Kanth, AdvocateFor Respondent: Shri Ajay Chandra, CIT DR
Section 1Section 92CSection 92C(3)

erred in holding that the commission paid to non-resident agents operating outside India was not liable to tax in India and hence assessee was not liable to deduct tax under section 195 of the Act, despite it being clearly held by the Tata Consultancy Services ... erred in holding that the commission paid to non-resident agents operating outside India was not liable to tax in India and hence assessee was not liable to deduct tax under section 195 of the Act, despite it being clearly held by the Assessing Officer that the commissions

Tata Consultancy Services Limited, Mumbai vs. Deputy Commissioner of Incometax 3(4), Mumbai

In the result, appeals of both, revenue and assessee are partly

ITA 1517/MUM/2025[2017-18]Status: DisposedITAT Mumbai30 Dec 2025AY 2017-18

Bench: Shri Pawan Singh & Shri Girish Agrawal

For Appellant: Shri Porus Kaka, Sr. AdvocateFor Respondent: Shri Ajay Chandra, CIT DR
Section 92CSection 92C(3)

erred in holding that the commission paid to non-resident agents operating outside India was not liable to tax in India and hence assessee was not liable to deduct tax under section 195 of the Act, despite it being clearly held by the 12 ITA No. 1516/Mum/2025 and others Tata ... erred in holding that the commission paid to non-resident agents operating outside India was not liable to tax in India and hence assessee was not liable to deduct tax under section 195 of the Act, despite it being clearly held by the Assessing Officer that the commissions

Deloitte Haskins and Sells LLP, Mumbai vs. Assistant Commissioner of Income Tax, Circle 16(2), Mumbai

In the result, appeal of the assessee is partly allowed

ITA 351/MUM/2024[2017-18]Status: DisposedITAT Mumbai30 Dec 2025AY 2017-18

Bench: Shri Amit Shukla & Shri Girish Agrawal

For Appellant: Shri P.J. Pardiwala, Sr. AdvocateFor Respondent: Shri Krishna Kumar Sr. DR
Section 143(3)Section 37(1)Section 40

section 1941 to submit that the professional services and technical services are different. Accordingly the Id AR submitted that the payments are not liable to tax in India in view of the Article 15 of the Tax Treaty between India and USA. It is also submitted that the services

Deloitte Haskins and Sells LLP, Mumbai vs. Assistant Commissioner of Income Tax, Circle 16(2), Mumbai

In the result, appeal of the assessee is partly allowed

ITA 350/MUM/2024[2013-14]Status: DisposedITAT Mumbai30 Dec 2025AY 2013-14

Bench: Shri Amit Shukla & Shri Girish Agrawal

For Appellant: Shri P.J. Pardiwala, Sr. AdvocateFor Respondent: Shri Krishna Kumar Sr. DR
Section 143(3)Section 37(1)Section 40

section 1941 to submit that the professional services and technical services are different. Accordingly the Id AR submitted that the payments are not liable to tax in India in view of the Article 15 of the Tax Treaty between India and USA. It is also submitted that the services

Deloitte Haskins and Sells LLP, Mumbai vs. Assistant Commissioner of Income-Tax, Mumbai

In the result, appeal of the assessee is partly allowed

ITA 320/MUM/2024[2015-16]Status: DisposedITAT Mumbai30 Dec 2025AY 2015-16

Bench: Shri Amit Shukla & Shri Girish Agrawal

For Appellant: Shri P.J. Pardiwala, Sr. AdvocateFor Respondent: Shri Krishna Kumar Sr. DR
Section 143(3)Section 37(1)Section 40

section 1941 to submit that the professional services and technical services are different. Accordingly the Id AR submitted that the payments are not liable to tax in India in view of the Article 15 of the Tax Treaty between India and USA. It is also submitted that the services

Deloitte Haskins and Sells LLP, Mumbai vs. Assistant Commissioner of Income-Tax, Mumbai

ITA 319/MUM/2024[2016-17]Status: DisposedITAT Mumbai30 Dec 2025AY 2016-17

Bench: Shri Amit Shukla & Shri Girish Agrawal

For Appellant: Shri P.J. Pardiwala, Sr. AdvocateFor Respondent: Shri Krishna Kumar Sr. DR
Section 143(3)Section 40

section 1941 to submit that the professional services and technical services are different. Accordingly the Id AR submitted that the payments are not liable to tax in India in view of the Article 15 of the Tax Treaty between India and USA. It is also submitted that the services

Devang Yogesh Metha, Mumbai vs. ITO Ward-19(1)(5), Mumbai

ITA 5211/MUM/2025[2021-22]Status: DisposedITAT Mumbai29 Dec 2025AY 2021-22

Bench: Shri Amit Shukla, Jm & Shri Arun Khodpia, Am

For Appellant: Shri. Vijay Mehta, ARFor Respondent: Assessee by
Section 139Section 139(4)Section 139(9)Section 140BSection 143(1)Section 143(1)(a)Section 154Section 2Section 250Section 44A

complied before 23.04.2022. In response, assessee to which furnished a response on 11.04.2022, clarifying that the assessee is not liable to Tax Audit for AY 2021-11, as per provisions of section 2 Devang Yogesh Mehta 44AB(a), as his Turnover of Rs. 6.33 crore is less than the prescribed

V Ramakrishnan, Chennai vs. DCIT Central Circle III(4), Chennai

In the result, the appeal for the A

ITA 744/CHNY/2005[2000-01]Status: DisposedITAT Chennai26 Dec 2025AY 2000-01

Bench: Shri Manu Kumar Giri & Shri S. R. Raghunatha

For Appellant: Shri. N. Arjun Raj, AdvocateFor Respondent: Shri. Bipin. C.N., C.I.T
Section 132Section 148Section 15Section 158BSection 17(1)(iv)

capital loss suffered by the appellate in the present case is a negative of the capital receipts. Since capital receipts are not liable to tax under the Income Tax Act, the capital loss suffered by the Appellant also cannot be allowed as deduction under the Income Tax Act.” 58. Aggrieved

V Ramakrishnan, Chennai vs. DCIT Central Circle III(4), Chennai

In the result, the appeal for the A

ITA 2197/CHNY/2005[1999-2000]Status: DisposedITAT Chennai26 Dec 2025AY 1999-2000

Bench: Shri Manu Kumar Giri & Shri S. R. Raghunatha

For Appellant: Shri. N. Arjun Raj, AdvocateFor Respondent: Shri. Bipin. C.N., C.I.T
Section 132Section 148Section 15Section 158BSection 17(1)(iv)

capital loss suffered by the appellate in the present case is a negative of the capital receipts. Since capital receipts are not liable to tax under the Income Tax Act, the capital loss suffered by the Appellant also cannot be allowed as deduction under the Income Tax Act.” 58. Aggrieved

Pratima Reddy Muthu, Hyderabad vs. ACIT., Circle-14(1), Hyderabad

ITA 1310/HYD/2025[2010-11]Status: DisposedITAT Hyderabad24 Dec 2025AY 2010-11

Bench: Shri Vijay Pal Rao & Shri Manjunatha G.आ.अपी.सं /Ita No.1310/Hyd/2025 Assessment Year 2010-2011 Pratima Reddy Muthu, Hyderabad – 500 034. The Acit, Circle-14(1), Vs. Hyderabad – 500 004. Telangana. Pan Aaopm8335J (Appellant) (Respondent) िनधा"रती "ारा /Assessee By: Sri Yogesh K Jagia & Sri Amit Sood, Advocates. राज" व "ारा /Revenue By: Ms U Mini Chandran, Cit-Dr सुनवाई की तारीख/Date Of Hearing: 24.11.2025 घोषणा की तारीख/Pronouncement: 24.12.2025 आदेश/Order

For Appellant: Sri Yogesh K Jagia And Sri Amit Sood, AdvocatesFor Respondent: MS U Mini Chandran, CIT-DR
Section 14Section 143(3)Section 159(1)Section 159(6)Section 171(1)Section 2(11)Section 2(29)Section 250Section 28

under consideration declaring total income of Rs.1.39 crores and also claiming balance amount of compensation as capital 6 ITA.No.1310/Hyd./2025 receipt not liable to tax. Thereafter, on receipt of information from the DDIT-(Inv.) regarding the compensation received by the assessee and her son of Rs.23 ... appeals filed by the Department were finally decided/disposed of by the Hon’ble High Court, the income would be considered as accrued and liable for tax. The learned Authorised Representative of the Assessee has further submitted that in any case the entire amount of compensation cannot be assessed as income

Asia Today Ltd, Mumbai vs. ADIT (It) 2(2), Mumbai

In the result, Assessee's appeal is allowed

ITA 1403/MUM/2008[2004-2005]Status: DisposedITAT Mumbai24 Dec 2025AY 2004-2005

Bench: Shri Narender Kumar Choudhry & Shri Omkareshwar Chidaraassessment Year: 2004-05 M/S. Asia Today Limited, Asst. Director Of Income C/O. Zee Entertainment Enterprises Tax (International Ltd., Vs. Taxation)-2(2), 135, Dr. Annie Besant Road, Scindia House, Worli, Mumbai – 400 018 Bellard Estate, Pan: Aabca0249F Mumbai - 400039 (Appellant) (Respondent) Present For: Assessee By : Shri Niraj Sheth, Ld. A.R. Revenue By : Shri Krishna Kumar, Ld. Sr. D.R. Date Of Hearing : 10.10.2025 Date Of Pronouncement : 24.12.2025 O R D E R Per : Narender Kumar Choudhry: This Appeal Has Been Preferred By The Assessee Against The Order Dated 25.01.2007, Impugned Herein, Passed By The Ld. Commissioner Of Income Tax (Appeals) (In Short Ld. Commissioner) U/S 250 Of The Income Tax Act, 1961 (In Short ‘The Act’) For The A.Y. 2004-05. 2. The Relevant Facts For Adjudication Of This Appeal Are As Under: The Assessee, Being A Foreign Telecasting Company Incorporated In Mauritius & Having Tax Residency Certificate Of Mauritius , During The Ay Under Consideration Was Engaged In The Production & Acquiring Rights Of Various Television Films Including Feature Films, As A Copy Right Owner/Holder Of Various Hindi Feature Films Produced & Censored In India, As Mentioned In Schedule ‘C’ Annexed With The ‘Agreement Of 2 M/S Asia Today Ltd. Vs Asst. Dit (Int. Taxation)-2(2)

For Appellant: Shri Niraj Sheth, Ld. A.RFor Respondent: Shri Krishna Kumar, Ld. Sr. D.R
Section 250Section 9(1)(vi)

agreement and delivered the films abroad, as transaction neither done in India nor money received in India and therefore the Assessee is not liable to tax in India. Further the Assessee has no Permanent Establishment (in short “PE”) in India and thus the income from license of films ... film rights is held to be taxable by way of income from Royalty. 6.4 The appellant stated that a Foreign Company is not liable to tax on the Income from the transactions done outside India. In this case the appellant has sold 100 Cinematographic films from his library abroad

Dy. Commissioner of Income Tax Central Circle-I Noida, Noida vs. M/S Rudra Buildwell Homes Pvt. Ltd., Delhi

Accordingly, all the grounds of appeal taken by Revenue are dismissed

ITA 4119/DEL/2025[2022-23]Status: DisposedITAT Delhi24 Dec 2025AY 2022-23

Bench: Shri Satbeer Singh Godara & Shri Manish Agarwaldy. Cit, M/S Rudra Buildwell Homes Central Circle-I, Private Limited, Noida-201301, Vs. D-53, Okhla, Phase-1, Uttar Pradesh. Delhi-110020. Pan-Aafcr6959P (Appellant) (Respondent) Dy. Cit, M/S Rudra Buildwell Projects Central Circle-I, Private Limited, Noida-201301, Vs. D-53, Okhla, Phase-1, Uttar Pradesh. Delhi-110020. Pan-Aaecr9589E (Appellant) (Respondent)

Section 142(1)Section 143(2)Section 143(3)Section 41(1)

reduction in liability due to acquisition of loan by the Asset Reconstruction Company (ARC) at a discounted value constituted a deemed benefit liable to tax in the case of the assessee. 2. Whether on facts and circumstances of the case and in law, the Ed. CELA) has erred in relying ... allowance or deduction claimed by assessee for previous years, when creditor waived repayment of said amount, it amounted to capital receipt not liable to tax - Whether Special Leave Petition filed against impugned order was to be dismissed Held, yes [Para 7][in favour of assessee] c) [2018] 93 taxmarin.com

Sms Group Gmbh, Delhi vs. ACIT.Circle-3(1)(2), New Delhi

In the result, the appeal of the assessee in ITA No

ITA 377/DEL/2025[2022-23]Status: DisposedITAT Delhi24 Dec 2025AY 2022-23

Bench: Shri M. Balaganesh & Shri Vimal Kumar

For Appellant: Shri Percy Pardiwala, Sr. AdvFor Respondent: Shri M. S. Nethrapal, CIT DR
Section 143(3)Section 144C(5)

drawings and designs was inextricably linked to sale of plant and equipment and represented consideration of the nature of 'Business Profits' not liable to tax in India, as per the provision of DTAA between India and Germany read with Indian Income-tax Act. 4. (a) That the learned A.O./DRP ... India. 5. That the learned A.O./DRP has erred in erroneously holding that amounts received towards reimbursement of cost towards intranet, SAP are liable to tax in India as 'Fees for Technical Services'. 6. That the learned A.O./DRP has erred in levying interest u/s 234B of the Income-tax

Sms Group Gmbh, New Delhi vs. ACIT, Circle 3(1)(2), International Txation, New Delhi

In the result, the appeal of the assessee in ITA No

ITA 993/DEL/2023[2020-21]Status: DisposedITAT Delhi24 Dec 2025AY 2020-21

Bench: Shri M. Balaganesh & Shri Vimal Kumar

For Appellant: Shri Percy Pardiwala, Sr. AdvFor Respondent: Shri M. S. Nethrapal, CIT DR
Section 143(3)Section 144C(5)

drawings and designs was inextricably linked to sale of plant and equipment and represented consideration of the nature of 'Business Profits' not liable to tax in India, as per the provision of DTAA between India and Germany read with Indian Income-tax Act. 4. (a) That the learned A.O./DRP ... India. 5. That the learned A.O./DRP has erred in erroneously holding that amounts received towards reimbursement of cost towards intranet, SAP are liable to tax in India as 'Fees for Technical Services'. 6. That the learned A.O./DRP has erred in levying interest u/s 234B of the Income-tax

Sms Group Gmbh, New Delhi vs. ACIT Circle - 3(1)(2) Intl. Taxation, New Delhi

In the result, the appeal of the assessee in ITA No

ITA 3297/DEL/2023[2021-22]Status: DisposedITAT Delhi24 Dec 2025AY 2021-22

Bench: Shri M. Balaganesh & Shri Vimal Kumar

For Appellant: Shri Percy Pardiwala, Sr. AdvFor Respondent: Shri M. S. Nethrapal, CIT DR
Section 143(3)Section 144C(5)

drawings and designs was inextricably linked to sale of plant and equipment and represented consideration of the nature of 'Business Profits' not liable to tax in India, as per the provision of DTAA between India and Germany read with Indian Income-tax Act. 4. (a) That the learned A.O./DRP ... India. 5. That the learned A.O./DRP has erred in erroneously holding that amounts received towards reimbursement of cost towards intranet, SAP are liable to tax in India as 'Fees for Technical Services'. 6. That the learned A.O./DRP has erred in levying interest u/s 234B of the Income-tax

Sms Group Gmbh, New Delhi vs. ACIT, Circle-3(1)(2) Int. Taxation, New Delhi

In the result, the appeal of the assessee in ITA No

ITA 1592/DEL/2022[2018-19]Status: DisposedITAT Delhi24 Dec 2025AY 2018-19

Bench: Shri M. Balaganesh & Shri Vimal Kumar

For Appellant: Shri Percy Pardiwala, Sr. AdvFor Respondent: Shri M. S. Nethrapal, CIT DR
Section 143(3)Section 144C(5)

drawings and designs was inextricably linked to sale of plant and equipment and represented consideration of the nature of 'Business Profits' not liable to tax in India, as per the provision of DTAA between India and Germany read with Indian Income-tax Act. 4. (a) That the learned A.O./DRP ... India. 5. That the learned A.O./DRP has erred in erroneously holding that amounts received towards reimbursement of cost towards intranet, SAP are liable to tax in India as 'Fees for Technical Services'. 6. That the learned A.O./DRP has erred in levying interest u/s 234B of the Income-tax

Sms Group Gmbh, New Delhi vs. ACIT, Circle-3(1)(2), Int. Taxation, New Delhi

In the result, the appeal of the assessee in ITA No

ITA 1591/DEL/2022[2017-18]Status: DisposedITAT Delhi24 Dec 2025AY 2017-18

Bench: Shri M. Balaganesh & Shri Vimal Kumar

For Appellant: Shri Percy Pardiwala, Sr. AdvFor Respondent: Shri M. S. Nethrapal, CIT DR
Section 143(3)Section 144C(5)

drawings and designs was inextricably linked to sale of plant and equipment and represented consideration of the nature of 'Business Profits' not liable to tax in India, as per the provision of DTAA between India and Germany read with Indian Income-tax Act. 4. (a) That the learned A.O./DRP ... India. 5. That the learned A.O./DRP has erred in erroneously holding that amounts received towards reimbursement of cost towards intranet, SAP are liable to tax in India as 'Fees for Technical Services'. 6. That the learned A.O./DRP has erred in levying interest u/s 234B of the Income-tax

Ankit Kabra, Surat vs. ITO, Ward-1(3)(1), Surat

In the result, the appeal of the assessee is dismissed

ITA 873/SRT/2025[2024-25]Status: DisposedITAT Surat23 Dec 2025AY 2024-25

Bench: Shri Sandeep Gosain () & Shri Om Prakash Kant () Assessment Year: 2024-2025 Ankit Kabra Ito, Ward-1(3)(1), A-402, Empire Regency, Current Jurisdiction Near Star Galaxy, Vip Road, Vs. Surat-395007 Vesu, Surat, Gujarat-395007 Pan No. Cdhpk 5978 D Appellant Respondent

For Appellant: Shri Yash Kapadia, CAFor Respondent: Shri J. K. Chandnani, Sr. DR
Section 112ASection 115BSection 87A

None of the decisions relied are upon by the assessee are in relation to income containing gain from VDA liable to tax under section 115BBH of the Act. Accordingly, we hold that business is not entitled for the rebate under section 87A of the Act. 7. In the result