“assessee in default”

TDS / TCSSection 201Section 2011,654 judgments

The decision most relied on for assessee in default is Rashmikant Kundalia v. Union of India (54 Taxmann.com 200), cited in 702 judgments on BharatTax.

Leading authorities on assessee in default

Rashmikant Kundalia v. Union of India

54 Taxmann.com 200 · 2015 · High Court

702

citing judgments

Section 234E, levying late fees for delayed filing of TDS statements under section 200(3), is constitutionally valid and constitutes a compensatory fee, not a punitive penalty. Before treating any person as an assessee-in-default, an opportunity of being heard must be provided.

Hindustan Coca Cola Beverage Pvt. Ltd. v. CIT

293 ITR 226 · 2007 · Supreme Court

576

citing judgments

The deductor cannot be treated as an assessee-in-default under Section 201(1) if the deductee has already paid the tax or offered the impugned receipts in their return of income. However, interest under Section 201(1A) for delayed deposit of tax can still be levied up to the date of filing of the return of income by the deductee.

Earthmoving Equipment Service Corporation v. DCIT 22(2), Mumbai

84 Taxmann.com 51 · 2017 · ITAT

263

citing judgments

A penalty levied under Section 271(1)(c) for concealment of income or furnishing inaccurate particulars cannot be deleted merely due to technical defects in the penalty notice, such as not ticking the specific default, if the assessee understood the charges.

DIT v. GE Packaged Power Inc.

373 ITR 65 · 2015 · High Court

199

citing judgments

Interest under section 234B for default in payment of advance tax is not leviable when the entire income is subject to tax deduction at source under section 195, as no advance tax liability arises for the assessee in such circumstances.

247 ITR 305 (Guj) CIT v. Nestle India Ltd.

140 ITR 832 · 1983 · High Court

172

citing judgments

An employer is not in default under section 201 if they have made a bona fide estimate of employee income and deducted tax at source based on that estimate.

Jagaran Prakashan Ltd. v. DCIT

345 ITR 288 · 2012 · High Court

164

citing judgments

A deductor cannot be treated as an assessee in default for failure to deduct tax at source if the recipient has already paid the income tax directly. The onus is on the deductor to prove that the recipient has paid the tax.

CIT v. Kotak Securities Ltd.

340 ITR 333 · 2012 · High Court

161

citing judgments

A deductor's bonafide belief or reliance on a Tax Residency Certificate (TRC) can influence whether they are deemed an 'assessee in default' under Section 195 for failing to deduct tax at source on payments to non-residents. The decision clarifies the due diligence required when interpreting tax treaties and TRCs for TDS compliance.

CIT v. Idea Cellular Ltd.

325 ITR 148 · 2010 · High Court

155

citing judgments

Discounts offered to distributors under a tightly controlled relationship constitute commission and are subject to tax deduction at source under Section 194H of the Income-tax Act.

Judgments citing assessee in default

Hebros Ahl Ifmr Capital 2014, Mumbai vs. ITO Ward TDS 1(2)(3), Mumbai

In the result, appeal of the assessee is allowed

ITA 6886/MUM/2025[2017-18]Status: DisposedITAT Mumbai09 Feb 2026AY 2017-18

Bench: Shri Anikesh Banerjee & Shri Prabhash Shankarhebros Ahl Ifmr V/S. Income Tax Officer, Tds Ward Capital 2014 बनाम – 1(2)(3) 901, 9Th Floor, Tower-B, Mtnl Telephone Exchange, Peninsula Business Park, Cumballa Hills, Pedder Road, Senapati Bapat Marg, Mumbai – 400026, Lower Parel (W), Mumbai – Maharashtra 400 098, Maharashtra स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aabth2476G Appellant/अपीलार्थी .. Respondent/प्रतिवादी

For Appellant: Shri Siddhesh Chaugule,ARFor Respondent: Shri Ritesh Misra, CIT(DR)

Section 115TSection 139Section 194LSection 201Section 201(1)

personal hearing before disposing off the appeal even when the same was requested by the Appellant. Ground No 2: Appellant being treated as ‘assessee in default’ The learned CIT(A) erred on facts and in law in dismissing the appeal filed against the order passed under section 201/201 ... Income-tax, Act 1961 (‘the Act’) of the Income-tax officer (TDS)-1(2)(3) [‘learned AO’] and by treating the Appellant as ‘assessee in default". Ground No 3: Non-applicability of section 194LBC of the Act The learned CIT(A) erred on facts and in law in upholding

DCIT (TDS)-2 3, Mumbai vs. Novartis India Limited, Mumbai

In the result, both the appeal of the Revenue and cross-

ITA 5681/MUM/2025[2016-17]Status: DisposedITAT Mumbai09 Feb 2026AY 2016-17

Bench: Shri Om Prakash Kant () And

Section 194HSection 201

Assessing Officer passed an order under sections 201(1) and 201(1A) of the Act dated 20.01.2020, treating the assessee as an assessee in default and raising a consolidated demand of %2,38,30,140/-. 3.1 Aggrieved, the assessee preferred an appeal before the Ld. CIT(A), who partly allowed

Kumud Bajaj, Hyderabad vs. ITO, Ward-1, Khammam

In the result, appeal filed by the assessee is dismissed

ITA 782/HYD/2025[2016-17]Status: DisposedITAT Hyderabad06 Feb 2026AY 2016-17

Bench: Shri Manjunatha G. & Shri Ravish Soodआ.अपी.सं /Ita No.782/Hyd/2025 ("नधा"रण वष"/Assessment Year: 2016-17) Kumud Bajaj, Vs. Income Tax Officer, Hyderabad. Ward-1, Pan: Acepb3914A Khammam. (Appellant) (Respondent) "नधा"रती "वारा/Assessee By: Smt. S. Sandhya, Advocate राज" व "वारा/Revenue By: Shri K. Vamsi Krishna, Sr. Ar

For Appellant: Smt. S. Sandhya, AdvocateFor Respondent: Shri K. Vamsi Krishna, Sr. AR

Section 142(1)Section 147Section 148Section 69A

made under section 201 on or after the 1st day of October, 1998 but before the 1st day of June, 2000 and the assessee in default has not presented any appeal within the time specified in that sub-section, he may present such appeal before the 1st day of July

Rao Khem Chand Vidya Vihar Shiksha Samiti, Rewari vs. ITO-TDS, Rohtak

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

ITA 3856/DEL/2024[2016-17]Status: DisposedITAT Delhi06 Feb 2026AY 2016-17

Bench: Ms. Madhumita Roy & Shri Naveen Chandra

For Appellant: Shri M.R. Sahu, CAFor Respondent: Ms. Harpreet Kaur Hansra, Sr. DR

Section 12ASection 191Section 200(3)Section 200A(1)Section 201Section 234ESection 40a

order of the ITO, TDS (Rohtak) [ITO, TDS] as null and void because the ITO, Tds exceeds his jurisdiction to declare the assessee as default u/s.201/201(1A) without ascertaining as to whether taxes had been deposited or not by recipient of income by not following the mandatory provisions of section ... income received from the Payer, again the Department can not recover tax on the same income by treating the Payer to be assessee-in-default for shortfall in tax deduction, thus the assessee prays for deletion of Rs.3,88,408/- in full. (B). Additional legal jurisdictional grounds of appeal raised

Youcloud Dmcc, Dubai vs. Deputy Commissioner of Income Tax, Gurugram

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

ITA 1220/DEL/2024[2018-2019]Status: DisposedITAT Delhi06 Feb 2026AY 2018-2019

Bench: Shri Ramit Kochar & Shri Raj Kumar Chauhan

Section 143(2)Section 144C(1)Section 144C(5)Section 147Section 148Section 148(1)(d)Section 201(1)

further observed that the said M/s Comviva,India was held to be an 'assessee in default' u/s 201(1)/201(1A) of the Act for non-deduction of TDS on payments made to the assessee as the said payments were in the nature of FTS chargeable to tax in India

Punjab National Bank, Baijnath vs. ITO(TDS), Palampur

In the result, all appeals of the assessee are allowed

ITA 778/CHANDI/2025[2016-17]Status: DisposedITAT Chandigarh05 Feb 2026AY 2016-17

Bench: the Commissioner. Similarly, it has been used in section 5 of Indian Limitation Act, 1963. Whenever interpretation and construction of this expression has fallen for consideration before Hon'ble High Court as well as before the Hon'ble Supreme Court, then, Hon'ble Court were unanimous in their conclusion that this expression is to be used liberally. We may make reference to the following observations of the Hon'ble Supreme court from the decision in the case of Collector Land Acquisition Vs

Section 249Section 253Section 3Section 5

proceed to decide them on merit. 7. The common issue involved in all these appeals is whether assessee deserves to be treated as assessee in default ITA No.410, 748,777 &778/CHD/2025 A.Y.2013-4 to 2016-17 7 u/s 201(1) and also liable to interest u/s 201(1A) of the Income

Punjab National Bank, Baijnath vs. ITO(TDS), Palampur

In the result, all appeals of the assessee are allowed

ITA 777/CHANDI/2025[2015-16]Status: DisposedITAT Chandigarh05 Feb 2026AY 2015-16

Section 249Section 253Section 3Section 5

Punjab National Bank, Baijnath vs. ITO(TDS), Palampur

In the result, all appeals of the assessee are allowed

ITA 748/CHANDI/2025[2014-15]Status: DisposedITAT Chandigarh05 Feb 2026AY 2014-15

Section 249Section 253Section 3Section 5

Punjab National Bank, Parwanoo vs. Income Tax Officer (TDS), Solan

In the result, all appeals of the assessee are allowed

ITA 410/CHANDI/2025[2013-14]Status: DisposedITAT Chandigarh05 Feb 2026AY 2013-14

Section 249Section 253Section 3Section 5

Arcil Sbps 001 I Trust, Mumbai vs. DCIT(TDS)-1(1), Mumbai

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

ITA 4700/MUM/2025[2017-18]Status: DisposedITAT Mumbai04 Feb 2026AY 2017-18

Bench: Shri Amit Shukla & Shri Makarand Vasant Mahadeokararcil Sbps 001 I Trust Dcit (Tds)-(1)(1), The Ruby, 10Th Floor, 29, Mtnl Building, Senapati Bapat Marg, Vs. Cumballa Hills, Dadar (W), Mumbai- Pedder Road, 400 028 Mumbai-400 026 Pan/Gir No. Aabta3859J (Applicant) (Respondent) Assessee By Shri Rahul Sarda, Ld. Ar Revenue By Shri Surendra Mohan, Ld. Dr Date Of Hearing 29.01.2026 Date Of Pronouncement 04.02.2026

Section 115TSection 133Section 194LSection 201Section 201(1)Section 250

Assessing Officer, represented income accrued to the investors. A show cause notice was issued proposing to treat the assessee as an assessee in default under section 201(1) for failure to deduct tax at source under section 194LBC of the Act. 3 Arcil SBPS 001 I Trust 4. The assessee ... previous year and, therefore, tax was required to be deducted under section 194LBC. The Assessing Officer accordingly treated the assessee as an assessee in default under section 201(1) and levied interest under section 201(1A). The computation made by the Assessing Officer was as under: - Surplus

Deputy Commissioner of Income Tax, Delhi vs. M/S Agilus Diagnostics Limited, Gurgaon

ITA 2836/DEL/2025[2017-18]Status: DisposedITAT Delhi04 Feb 2026AY 2017-18

Bench: Shri Anubhav Sharma & Shri Manish Agarwaldcit, Vs. M/S Agilus Diagnostics Circle-73(1), Room Ltd, No.413, 4Th Floor, Aayakar 306, Tower A, Unitech Bhawa, Laxmi Nagar, Cyber Park, Sector 39, Delhi Gurugram 122002 "थायीलेखासं./जीआइआरसं./Pan/Gir No: Aaacs 2809 J Appellant .. Respondent

For Appellant: Sh. Devashish Jain, Adv &For Respondent: Sh. Rajesh Kumar Dhanesta, Sr

Section 192Section 194JSection 201Section 201(1)Section 246(2)Section 250

passed impugned order dated 22.06.2018 under Section 201(1)/201(14) of the IT Act, treating the Respondent to be an 'assessee in default for deducting TDS on payments made to Consultants under Section 194J of the IT Act instead of Section 192 of the IT Act, thereby raising ... already offered the professional income to income-tax while filing their income tax return(s) Accordingly, the Respondent cannot be considered as an 'assessee in default' on the basis the Proviso attached to Section 201 of IT Act. Reliance in this regard can be placed on Hindustan Coca Cola Beverage

M/S Motor & General Sales Limited, Lucknow vs. Income Tax Officer(TDS)-II, Kanpur

In the result, the appeal of the assessee is partly allowed

ITA 136/LKW/2020[2012-13]Status: DisposedITAT Lucknow02 Feb 2026AY 2012-13

Bench: Shri Kul Bharat & Shri, Nikhil Choudharyassessment Year: 2012-13 M/S. Motor & General Sales V. Income Tax Officer Ltd (Tds)-Ii 11, M. G. Marg, Hazratganj, Commissioner Of Income Lucknow-226001. Tax (Appeals-Ii), Kanpur- 208001. Pan:Lknmo0336A (Appellant) (Respondent) Appellant By: Shri Rakesh Garg, Ca Respondent By: Shri S. H. Usmani, Cit- Dr Date Of Hearing: 06 11 2025 Date Of Pronouncement: 02 02 2026 O R D E R

For Appellant: Shri Rakesh Garg, CAFor Respondent: Shri S. H. Usmani, CIT- DR

Section 133ASection 194ASection 2Section 201(1)Section 250(6)

that the assessee ought to have deducted tax at source at the rate of 10% thereon. He accordingly treated the assessee as an assessee in default u/s 201(1) of the Act to the extent of Rs.4,78,950/-. Since the assessee had failed to deposit the said amount into

Urban Administration Amd Development, Bhopal vs. Deputy Commissioner of Income Tax (TDS), Bhopal

In the result, the impugned order is set aside as & by way of

ITA 477/IND/2025[2015-16]Status: DisposedITAT Indore30 Jan 2026AY 2015-16

Bench: Shri B.M. Biyani & Shri Paresh M Joshidirectorate Of Urban Deputy बनाम/ Administrations & Development, Commissioner Of Vs. Nagar Palika Bhawan, 6 No.Bus Income Tax-Tds, Stop, R.S.Market, Bhopal S.O. Huzur, Bhopal(M.P.) (Tan: Bpldo1618B) (Appellant) (Respondent) Assessee By Shri Sapan Usrethe, Adv. & Ms. Apoorva Garg, Ca Revenue By Shri Anup Singh, Cit Dr Date Of Hearing 21.01.2026 Date Of Pronouncement 30.01.2026 आदेश / O R D E R

Section 201Section 201(1)Section 246ASection 250Section 253

DCIT(TDS), Bhopal dated 28.12.2021, the assessee was found & deemed to be an Assessee in Default for Short deduction of Tax of Rs. 2,98,992/- u/s 201(1) of the Act-for AY 2015-16 & as per provision of section 201(1A), the assessee was held liable

Dhandeep Concretes, Jaipur vs. Income Tax Officer(TDS), Ujjain

In the result we set aside the “Impugned order” &

ITA 429/IND/2025[2018-2019]Status: DisposedITAT Indore30 Jan 2026AY 2018-2019

Bench: Shri B.M. Biyani & Shri Paresh M Joshidhandeep Concretes, Ito -(Tds), बनाम/ 409-410, Jaipur Centre 4Th Bharatpuri, Vs. Floor, B2 Bypass Junction, Ujjain. Tonk Road, Jaipur. (Appellant) (Respondent) Assessee By Ms. Priya Agrawal, Ca Revenue By Shri Ashish Porwal, Sr.Dr Date Of Hearing 15.01.2026 Date Of Pronouncement 30.01.2026 आदेश/ O R D E R

Section 132Section 194CSection 201Section 201(1)Section 246ASection 250Section 253

case, Id. CIT(A) has grossly erred in confirming the actions of the Id. AO in treating the appellant as an assessee in default under section 201(1) & 201(1A) of the Income-tax Act, 1961, despite the fact that the alleged payments were not recorded in the regular books

Karthik Lakshman, Chennai vs. Iyo, Intl Taxationward-1(2), Chennai

In the result, appeal of the assessee is allowed

ITA 2182/CHNY/2025[2024-25]Status: DisposedITAT Chennai30 Jan 2026AY 2024-25

Bench: Shri George George Kand Ms. Padmavathy.Sआयकर अपील सं./Ita No.2182/Chny/2025 िनधा"रण वष" /Assessment Year: 2024-25

For Respondent: Ms. R.Kavitha, Addl. CIT

Section 143(1)Section 205Section 250

control over the matter. The responsibility of such person is to the extent that he has to be deemed to be an ‘assessee in default’ in respect of tax. Going by the ratio laid down by the Hon’ble Gujarat High Court in the case of Kartik Vijaysinh Sonavane

Shekhar Narayan, Patna vs. NFAC, Delhi

In the result, both the appeals filed by the assessee are partly allowed for statistical purposes

ITA 355/PAT/2025[2018-19]Status: DisposedITAT Patna29 Jan 2026AY 2018-19

Bench: Shri Sonjoy Sarma & Shri Rakesh Mishra

Section 13Section 194Section 194JSection 250Section 44A

case. ITA Nos.: 354 & 355/PAT/2025 AYs: 2017-18 & 2018-19 Shekhar Narayan. 19. For that the appellant may not be treated as assessee in default in respect of the disputed demand including interest. 20. For that the whole order is bad in fact and law of the case ... unjustified on the facts and in the circumstances of the appellant's case. 19. For that the appellant may not be treated as assessee in default in respect of the disputed demand including interest. 20. For that the whole order is bad in fact and law of the case

Shekhar Narayan, Patna vs. NFAC, Delhi

In the result, both the appeals filed by the assessee are partly allowed for statistical purposes

ITA 354/PAT/2025[2017-18]Status: DisposedITAT Patna29 Jan 2026AY 2017-18

Bench: Shri Sonjoy Sarma & Shri Rakesh Mishra

Section 13Section 194Section 194JSection 250Section 44A

Gujarat Urban Development Co. Ltd., Gandhinagar vs. The Dy.CIT, Gandhinagar Circle, Gandhinagar

In the result, both the appeals of the assessee stand allowed

ITA 2158/AHD/2025[2018-19]Status: DisposedITAT Ahmedabad28 Jan 2026AY 2018-19

Bench: Shri Sanjay Garg & Annapurna Gupta1. आयकर अपील सं /Ita No.2157/Ahd/2025 2. आयकर अपील सं /Ita No.2158/Ahd/2025 िनधा"रण वष" /Assessment Year : 2018-19 Gujarat Urban Development The Dy.Cit, बनाम/ Co.Ltd. Gandhinagar Circle V/S. Karmayogi Bhavan It Office Block-1, Udhyog Bhavan B 1 Wing, Ground Floor Sector-11 Sector-10A Gandhinagar – 382 010 Gandhinagar – 382 010 "थायी लेखा सं./Pan: Aabcg 1330 R (अपीलाथ(/ Appellant) ()* यथ(/ Respondent) Assessee By : Shri S.N. Soparkar, Sr. Advocate & Ms. Ukti Shah, Ars Revenue By : Shri Alpesh Parmar, Cit-Dr & Shri Arvind R. Kumbhare Sr.Dr सुनवाई की तारीख/Date Of Hearing : 21/012026 घोषणा की तारीख /Date Of Pronouncement: 28/01/2026 आदेश/O R D E R Per Sanjay Garg:

For Appellant: Shri S.N. Soparkar, Sr. Advocate and Ms. Ukti Shah, ARsFor Respondent: Shri Alpesh Parmar, CIT-DR and Shri Arvind R. Kumbhare Sr.DR

Section 234BSection 250Section 270A

levied by AO u/s 272A of the Act. 2. Ld. CIT (A) erred in law and on facts confirming action of AO holding assessee in default for non-compliance to notices issued u/s 143(2) & 142(1) of the Act not considering documentary evidence of responses to the notices submitted

Gujarat Urban Development Co. Ltd., Gandhinagar vs. The Dy.CIT, Gandhinagar Circle, Gandhinagar

In the result, both the appeals of the assessee stand allowed

ITA 2157/AHD/2025[2018-19]Status: DisposedITAT Ahmedabad28 Jan 2026AY 2018-19

For Appellant: Shri S.N. Soparkar, Sr. Advocate and Ms. Ukti Shah, ARsFor Respondent: Shri Alpesh Parmar, CIT-DR and Shri Arvind R. Kumbhare Sr.DR

Section 234BSection 250Section 270A

Mech Secons, Durgapur vs. D.C.I.T., CC - 3(3), Kolkata

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 2401/KOL/2025[2017-2018]Status: DisposedITAT Kolkata28 Jan 2026AY 2017-2018

Bench: Shri George Mathan & Shri Rakesh Mishra

Section 133ASection 133A(1)Section 140ASection 147Section 148Section 250

provisions of sub-section (1), he shall, without prejudice to any other consequences which he may incur, be deemed to be an assessee in default in respect of the tax, interest or fee remaining unpaid, and all the provisions of this Act shall apply accordingly. Thus, there are consequences