Section 201(1A) of the Income Tax Act

Income-tax Act, 2025: s.398

Section 201(1A) 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(1A) is GE India Technology Centre Pvt. Ltd. v. CIT (327 ITR 456), cited in 663 of the 4,608 judgments on BharatTax that turn on this section.

Leading authorities on Section 201(1A)

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.

MALPE VISHWANATH ACHARYA AND OTHERS v. STATE OF MAHARASHTRA AND ANOTHER. 365 32
9 SCC 1 · 2018 · Supreme Court
533
citing judgments
254 ITR 121 (Guj) ITO v. Gujarat Narmada Valley Fertilizers Co. Ltd.
243 ITR 435 · 2000 · High Court
173
citing judgments
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.

Chandra Kishore Jha v. Mahavir Prasad
8 SCC 266 · 1999 · Supreme Court
163
citing judgments

If a statute or law prescribes that a thing must be done in a particular manner, then it must be done in that manner alone and in no other way. This principle mandates strict adherence to statutory procedures.

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 vs. Nicholas Piramal India Ltd (2008) 299 ITR 0356 (BOMBAY); CIT v. Semiconductor Complex Ltd.
282 ITR 263 · 2006 · High Court
159
citing judgments

An employer making a bona fide estimate of taxable salary income is acting in accordance with established legal precedent.

Verizon Communications Singapore Pte Ltd. v. ITO
361 ITR 575 · 2014 · High Court
156
citing judgments

Payments for the use of equipment or copyrighted articles constitute royalty income under section 9(1)(vi) of the Income-tax Act, necessitating TDS deduction under section 195 and attracting disallowance under section 40(a)(i) for non-compliance.

Judgments on Section 201(1A)

Ssj Finance & Securities P. Ltd, Mumbai vs. ITO (TDS) WD 3(3), Mumbai

ITA 6623/MUM/2014[2011-12]Status: DisposedITAT Mumbai18 Jan 2017AY 2011-12

Bench: Shri Rajendra, A.M. & Shri Pawan Singh,J.M. आयकर अपील सं./Ita No.6621/Mum/2014,िनधा"रण िनधा"रण वष" वष" /Assessment Year: 2008-09 िनधा"रण िनधा"रण वष" वष" आयकर अपील सं./Ita No.6622/Mum/2014,िनधा"रण वष" िनधा"रण वष" /Assessment Year: 2009-10 िनधा"रण वष" िनधा"रण वष" M/S.Ssj Commodities Pvt. Ltd. Income Tax Officer-(Tds) 1St Floor, Surya Mahal Ward-3(3) Vs. Bb Marg, Fort, Mumbai-400 023. Mumbai-400 020. Pan: Aahcs 5863 M (अपीलाथ" /Appellant) (""यथ" / Respondent) आयकर अपील सं./Ita No.6623/Mum/2014,िनधा"रण वष" िनधा"रण वष" िनधा"रण वष" /Assessment Year: 2011-12 िनधा"रण वष" M/S.Ssj Finance & Securities Pvt. Ltd. Income Tax Officer-(Tds) 1St Floor, Surya Mahal Ward-3(3) Vs. Bb Marg, Fort, Mumbai-400 023. Mumbai-400 020. Pan: Aabcs 4245 H (अपीलाथ" /Appellant) (""यथ" / Respondent) Revenue By: Ms. Beena Santosh-Dr Assessee By: Shri Ritesh Jain सुनवाई क" तारीख / Date Of Hearing: 12.01.2017 घोषणा क" तारीख / Date Of Pronouncement: 18.01.2017 आयकर आयकर अिधिनयम आयकर आयकर अिधिनयम अिधिनयम,1961 क" अिधिनयम क" क" धारा क" धारा धारा 254(1)के अ"तग"त आदेश धारा के अ"तग"त आदेश के अ"तग"त आदेश के अ"तग"त आदेश Order U/S.254(1)Of The Income-Tax Act,1961(Act) लेखा लेखा सद"य लेखा लेखा सद"य सद"य, राजे"" सद"य राजे"" राजे"" केकेकेके अनुसार राजे"" अनुसार अनुसार/ Per Rajendra A.M.- अनुसार Challenging The Orders,Dated 18/08/2014 Of The Cit (A)-14,Mumbai The Assessees Have Filed Appeals For The Above Mentioned Assessment Years(Ay.S). Issues Involved In All The Appeals Are Identical Except For The Amounts Involved & All The Assessees Are From The Same Group.So,For The Sake Of Convenience, We Are Adjudicating These Appeals By Passing A Single Order.

For Appellant: Shri Ritesh JainFor Respondent: Ms. beena Santosh-DR
Section 194Section 194JSection 201Section 201(1)Section 254(1)Section 9

Ssj Commodities P.Ltd, Mumbai vs. ITO (TDS) WD 3(3), Mumbai

ITA 6621/MUM/2014[2008-09]Status: DisposedITAT Mumbai18 Jan 2017AY 2008-09

Bench: Shri Rajendra, A.M. & Shri Pawan Singh,J.M. आयकर अपील सं./Ita No.6621/Mum/2014,िनधा"रण िनधा"रण वष" वष" /Assessment Year: 2008-09 िनधा"रण िनधा"रण वष" वष" आयकर अपील सं./Ita No.6622/Mum/2014,िनधा"रण वष" िनधा"रण वष" /Assessment Year: 2009-10 िनधा"रण वष" िनधा"रण वष" M/S.Ssj Commodities Pvt. Ltd. Income Tax Officer-(Tds) 1St Floor, Surya Mahal Ward-3(3) Vs. Bb Marg, Fort, Mumbai-400 023. Mumbai-400 020. Pan: Aahcs 5863 M (अपीलाथ" /Appellant) (""यथ" / Respondent) आयकर अपील सं./Ita No.6623/Mum/2014,िनधा"रण वष" िनधा"रण वष" िनधा"रण वष" /Assessment Year: 2011-12 िनधा"रण वष" M/S.Ssj Finance & Securities Pvt. Ltd. Income Tax Officer-(Tds) 1St Floor, Surya Mahal Ward-3(3) Vs. Bb Marg, Fort, Mumbai-400 023. Mumbai-400 020. Pan: Aabcs 4245 H (अपीलाथ" /Appellant) (""यथ" / Respondent) Revenue By: Ms. Beena Santosh-Dr Assessee By: Shri Ritesh Jain सुनवाई क" तारीख / Date Of Hearing: 12.01.2017 घोषणा क" तारीख / Date Of Pronouncement: 18.01.2017 आयकर आयकर अिधिनयम आयकर आयकर अिधिनयम अिधिनयम,1961 क" अिधिनयम क" क" धारा क" धारा धारा 254(1)के अ"तग"त आदेश धारा के अ"तग"त आदेश के अ"तग"त आदेश के अ"तग"त आदेश Order U/S.254(1)Of The Income-Tax Act,1961(Act) लेखा लेखा सद"य लेखा लेखा सद"य सद"य, राजे"" सद"य राजे"" राजे"" केकेकेके अनुसार राजे"" अनुसार अनुसार/ Per Rajendra A.M.- अनुसार Challenging The Orders,Dated 18/08/2014 Of The Cit (A)-14,Mumbai The Assessees Have Filed Appeals For The Above Mentioned Assessment Years(Ay.S). Issues Involved In All The Appeals Are Identical Except For The Amounts Involved & All The Assessees Are From The Same Group.So,For The Sake Of Convenience, We Are Adjudicating These Appeals By Passing A Single Order.

For Appellant: Shri Ritesh JainFor Respondent: Ms. beena Santosh-DR
Section 194Section 194JSection 201Section 201(1)Section 254(1)Section 9

ITO TDS 3(3), Mumbai vs. Syncom Formulations (India ) Ltd, Mumbai

ITA 3913/MUM/2014[2007-08]Status: DisposedITAT Mumbai10 Jan 2017AY 2007-08

Bench: Shri Rajendra, A.M. & Shri Pawan Singh,J.M. आयकर अपील सं./Ita No.3913/Mum/2014,िनधा" िनधा" िनधा"रण वष" िनधा" रण वष" रण वष" /Assessment Year: 2007-08 रण वष" Income Tax Officer(Tds)-3(3) M/S. Syncom Formulations (India) Ltd. 1010, 10Th Floor, Gala-7, Niraj Industrial Estate Smt. K.G. Mittal Ayurvedic Hospital Off, Mahakali Caves Road, Andheri(E) Vs. Bldg., Charni Road(W) Mumbai-400 093. Mumbai-400 002. Pan: Aafcs 6794 R (अपीलाथ" /Appellant) (""यथ" / Respondent) Revenue By: Ms. Beena Santosh Assessee By: None सुनवाई क" तारीख / Date Of Hearing: 10.01.2017 घोषणा की तारीख / Date Of Pronouncement: 10.01.2017 आयकर आयकर अिधिनयम अिधिनयम,1961 क" क" धारा धारा 254(1)के अ"तग"त आदेश के अ"तग"त आदेश आयकर आयकर अिधिनयम अिधिनयम क" क" धारा धारा के अ"तग"त आदेश के अ"तग"त आदेश Order U/S.254(1)Of The Income-Tax Act,1961(Act) लेखा सद"य लेखा सद"य, राजे"" राजे"" केकेकेके अनुसार अनुसार/ Per Rajendra A.M.- लेखा लेखा सद"य सद"य राजे"" राजे"" अनुसार अनुसार Challenging The Order,Dated 10/03/2014,Of The Cit (A)-14,Mumbai The Assessing Officer(Ao) Has Filed The Present Appeal.While Examining The Records Of The Assessee, He Found That The Assessee Had Filed The Tds Returns After The Due Dates That Were Required To Be Filed At The End Of Every Quarter Under The Provisions Of Section 200(3) Read With Rule 31A Of The Income Tax Rules,1962 (Rules).He Further Found That The Quarterly Statement Of Tds In Form Number 24Q & 26Q Was Required To Be Filed On Its Specified Dates Were Also Not Filed.He Compiled The Delay In Submission The Tds Returns For The Ay.2007-08 As Under: Quarter No. Of Days Delay Tds Amount Penalty Amount (In Rs.) 24-Q1 976 22000 22000

For Appellant: NoneFor Respondent: Ms. Beena Santosh
Section 200Section 200(3)Section 201Section 254(1)Section 272A(2)(k)

DCIT (It) 2(2)(1), Mumbai vs. Ingram Micro India Ltd, Mumbai

ITA 1385/MUM/2015[2008-09]Status: DisposedITAT Mumbai06 Jan 2017AY 2008-09

Bench: S/Shri Rajendra & C.N. Prasadआयकर आयकर आयकर अपील आयकर अपील अपील संसंसंसं/ Ita No.1385 & 1386/Mum/2015:िनधा"रण अपील वष"/Assessment Year-2008-09 िनधा"रण वष" िनधा"रण िनधा"रण वष" वष" Dcit(It)-2(2)(1), M/S. Ingram Micro India Limited, Godrej I.T. Park, B-Block, 5Th Floor, Mumbai. Vs. Pirojshahnagar, Lbs Road, Vikhroli (West), Mumbai – 79 Pan : Aabct 1296 R (Appellant) (Respondent) ""या ""या ""या"े"े"े"ेप /Co.No.169 & 170/Mum/2015:िनधा"रण ""या वष"/Assessment Year-2008-09 िनधा"रण वष" िनधा"रण िनधा"रण वष" वष" M/S. Ingram Micro India Limited, Vs. Dcit(It)-2(2)(1), Vikhroli (West), Mumbai – 79 Mumbai. (Appellant) (Respondent) Revenue By: Shri K. Mohandas - Dr Assessee By: Shri P.B. Chhapgar – Ca सुनवाई क" तारीख / Date Of Hearing: 25/10/2016 घोषणा क" तारीख / Date Of Pronouncement: 06/01/2017 आयकर आयकर अिधिनयम आयकर आयकर अिधिनयम अिधिनयम,1961 अिधिनयम 1961 1961 क" धारा 1961 क" धारा क" धारा 254 क" धारा 254 254(1)के अ"तग"त आदेश 254 के अ"तग"त आदेश के अ"तग"त आदेश के अ"तग"त आदेश Order U/S.254(1)Of The Income-Tax Act,1961(Act) लेखा सद"य लेखा सद"य, राजे"" लेखा सद"य लेखा सद"य राजे"" राजे"" के अनुसार राजे"" के अनुसार के अनुसार/ Per Rajendra A.M.- के अनुसार Challenging The Orders Dated 30/10/2014 Of The Cit(A)-10, Mumbai, The Assessing Officer (Ao)And The Assessee Have Filed The Above Appeals/Cross Objections (Co.S).

For Appellant: Shri P.B. Chhapgar – CAFor Respondent: Shri K. Mohandas - DR
Section 133ASection 201Section 254(1)Section 9(1)(vii)