Section 201(1) of the Income Tax Act

Income-tax Act, 2025: s.398

Section 201(1) falls under section 201 of the Income-tax Act, 1961, which corresponds to section 398 (Consequences of failure to deduct or pay or, collect or pay) of the Income-tax Act, 2025.

Read section 398 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 201(1) is Kourani v. Union OF India (83 Taxmann.com 137), cited in 1,708 of the 3,835 judgments on BharatTax that turn on this section.

Leading authorities on Section 201(1)

Kourani v. Union OF India
83 Taxmann.com 137 · 2017 · High Court
1,708
citing judgments

The fee under Section 234E for late filing of TDS/TCS statements cannot be levied retrospectively by processing an intimation under Section 200A for defaults occurring before the amendment allowing such processing.

Fateh Raj Singhvi & Ors. v. UOI
289 CTR 602 · 2016 · High Court
844
citing judgments

A fee under Section 234E cannot be levied or adjusted in an intimation under Section 200A for TDS statements pertaining to periods prior to June 1, 2015, as the enabling amendment to Section 200A(1)(c) came into effect only from that date.

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.

GE India Technology Centre Pvt. Ltd. v. CIT
327 ITR 456 · 2010 · Supreme Court
663
citing judgments

Tax must be deducted at source from payments made to a non-resident under Section 195 only if such payment is chargeable to tax in India. The Assessing Officer bears the onus to establish that the payments made are indeed chargeable to tax under the Income Tax Act.

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.

Gajanan Constructions v. DCIT
74 Taxmann.com 6 · 2016 · ITAT
465
citing judgments

Late fees under section 234E can only be levied prospectively from June 1, 2015. Levying late fees for periods prior to this date is not permissible.

Dundlod Shikshan Sansthan v. Union of India
63 Taxmann.com 243 · 2015 · High Court
397
citing judgments

The imposition of fees for late filing of TDS/TCS returns prior to the Finance Act, 2015 amendments was not illegal, and the Rajasthan High Court found no justification to interfere with such compensatory fees.

CIT v. Ansal Land Mark Township (P) Ltd.
377 ITR 635 · 2015 · High Court
369
citing judgments

The second proviso to Section 40(a)(ia), introduced by the Finance Act, 2012, is curative and applies retrospectively from April 1, 2005. Consequently, if the recipient of a payment has filed their return and paid taxes on the amount from which tax was not deducted at source, the payer's expenditure cannot be disallowed under Section 40(a)(ia).

Sree Narayana Guru Smaraka Sangam Upper Primary School v. Union of India and Others
392 ITR 457 · 2017 · High Court
217
citing judgments
137 (Guj.) IV. Qatalys Software Technologies (P.) Ltd. v. UOI
115 Taxmann.com 345 · 2020 · High Court
178
citing judgments

The Madras High Court has upheld the validity of the levy of fees under Section 234E and penalties under Section 271H, finding the charging provision to be Section 234E, with the power to levy existing from 01/07/2012.

Judgments on Section 201(1)

Arya Roadways Co.Pvt. Ltd., Kolkata vs. ITO, Ward - 3(3), Kolkata [New ITO, Ward - 12(1), Kolkata]

Appeal is allowed

ITA 1454/KOL/2017[2010-11]Status: DisposedITAT Kolkata26 Dec 2018AY 2010-11

Bench: Shri S.S.Godara & Shri, M. Balaganeshassessment Year :2010-11 Arya Roadways Co Pvt V/S. Ito Ward-3(3), [New Ltd., Tivoli Court, Block-B, Ito Ward-12(1)] Aayakar Bhavana, 7Th Flat-93, 1C, Ballygunge Circular Road, Floor, P-7, Chowringhee Kolkata-700 019 Square, Kolkata-69 [Pan No.Aaeca 9139 M] .. अपीलाथ" /Appellant ""यथ"/Respondent Shri Brijesh Kr. Singh, Advocate अपीलाथ" क" ओर से/By Appellant Shri A.K. Singh, Cit-Dr ""यथ" क" ओर से/By Respondent 06-12-2018 सुनवाई क" तार"ख/Date Of Hearing 26-12-2018 घोषणा क" तार"ख/Date Of Pronouncement आदेश /O R D E R Per S.S.Godara:- This Assessee’S Appeal For Assessment Year 2010-11 Arises Against The Commissioner Of Income Tax (Appeals)-15, Kolkata’S Order Dated 21.02.2017 Passed In Case No.385/Cit(A)-15/15-16/3(3)/R&T/Kol Involving Proceedings U/S 143(3) Of The Income Tax Act, 1961; In Short ‘The Act’. Heard Both The Sides. 2. The Assessee Has Raised Two Substantive Grounds In The Instant Appeal. It Firstly Seeks To Reverse Both The Lower Authorities’ Action Disallowing / Adding Its Freight Charges Of ₹11,68,46,218/- As Well As Loading / Unloading Charges Of ₹10,87,385/- Paid To Various Parties On

Section 139Section 143(3)Section 192Section 201(1)Section 40