Section 201 of the Income Tax Act

Income-tax Act, 2025: s.398

Section 201 of the Income-tax Act, 1961 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 is Hindustan Coca Cola Beverage Pvt. Ltd. v. CIT (293 ITR 226), cited in 576 of the 1,566 judgments on BharatTax that turn on this section.

Leading authorities on Section 201

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
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 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.

CIT v. Associated Cement Companies Ltd.
172 ITR 257 · 1988 · Supreme Court
126
citing judgments

An expenditure is classified as either capital or revenue; the 'enduring benefit' test is a key criterion for this distinction, and income tax law does not generally recognize deferred revenue expenditure unless specifically provided.

State Lotteries & Ors. (2001) 249 ITR 186 and Ahmedabad Stamp Vendors Association v. Union of India
257 ITR 202 · 2002 · High Court
121
citing judgments

Supplementary commission forional or extra services does not fall within the ambit of Section 194H of the Income Tax Act, 1961. This may affect the applicability of certificates issued under Section 197.

CIT v. NHK Japan Broadcasting Corporation
305 ITR 137 · 2008 · High Court
96
citing judgments

When no specific statutory period of limitation exists, proceedings under Section 201(1) and 201(1A) of the Income-tax Act, particularly for payments to non-residents, must be initiated within a reasonable period of four years. This limitation also applies to consequential penalty proceedings under Section 271C.

Judgments on Section 201

M/S Google India Private Limited, Bangalore vs. Dy. D.I.T., Bangalore

In the result, the appeals filed by the assessee are allowed

ITA 1516/BANG/2013[2012-13]Status: DisposedITAT Bangalore19 Oct 2022AY 2012-13

Bench: Shri George George K, Jm & Ms.Padmavathy S, Am It(Tp)A No.1513/Bang/2013 : Asst.Year 2009-2010 It(Tp)A No.1514/Bang/2013 : Asst.Year 2010-2011 It(Tp)A No.1515/Bang/2013 : Asst.Year 2011-2012 It(Tp)A No.1516/Bang/2013 : Asst.Year 2012-2013 M/S.Google India Private Limited The Deputy Commissioner Of No.3, Rmz Infinity Tower-E Income-Tax (International V. 4Th Floor, Old Madras Road Taxation), Circle 1(1) Bangalore. Bangalore – 560 016. Pan : Aaccg0527D. (Appellant) (Respondent) Appellant By : Sri.Percy Pardiwala, Sr.Advocate, Sri.Anmol Anand, Advocate, Miss.Priya Tandon, Advocate & Sri.Vinay Mangla, Ca Respondent By : Sri.K.V.Aravind, Standing Counsel Date Of Pronouncement : 19.10.2022 Date Of Hearing : 13.09.2022 O R D E R Per George George K, Jm : These Appeals At The Instance Of The Assessee Were Originally Disposed By The Itat Vide Its Common Order Dated 23.10.2017. On Further Appeal At The Instance Of The Assessee, The Hon’Ble High Court Vide Judgment Dated 17.04.2021 In Ita No.883/2017, 897/2017 To 899/2017, Restored The Matter To The Itat For De Novo Consideration. The Relevant Finding Of The Hon’Ble High Court Reads As Follows:-

For Appellant: Sri.Percy Pardiwala, Sr.Advocate, Sri.Anmol AnandFor Respondent: Sri.K.V.Aravind, Standing Counsel
Section 201Section 201(3)Section 9(1)(vi)

M/S Google India Private Limited, Bangalore vs. Dy. D.I.T., Bangalore

In the result, the appeals filed by the assessee are allowed

ITA 1515/BANG/2013[2011-12]Status: DisposedITAT Bangalore19 Oct 2022AY 2011-12

Bench: Shri George George K, Jm & Ms.Padmavathy S, Am It(Tp)A No.1513/Bang/2013 : Asst.Year 2009-2010 It(Tp)A No.1514/Bang/2013 : Asst.Year 2010-2011 It(Tp)A No.1515/Bang/2013 : Asst.Year 2011-2012 It(Tp)A No.1516/Bang/2013 : Asst.Year 2012-2013 M/S.Google India Private Limited The Deputy Commissioner Of No.3, Rmz Infinity Tower-E Income-Tax (International V. 4Th Floor, Old Madras Road Taxation), Circle 1(1) Bangalore. Bangalore – 560 016. Pan : Aaccg0527D. (Appellant) (Respondent) Appellant By : Sri.Percy Pardiwala, Sr.Advocate, Sri.Anmol Anand, Advocate, Miss.Priya Tandon, Advocate & Sri.Vinay Mangla, Ca Respondent By : Sri.K.V.Aravind, Standing Counsel Date Of Pronouncement : 19.10.2022 Date Of Hearing : 13.09.2022 O R D E R Per George George K, Jm : These Appeals At The Instance Of The Assessee Were Originally Disposed By The Itat Vide Its Common Order Dated 23.10.2017. On Further Appeal At The Instance Of The Assessee, The Hon’Ble High Court Vide Judgment Dated 17.04.2021 In Ita No.883/2017, 897/2017 To 899/2017, Restored The Matter To The Itat For De Novo Consideration. The Relevant Finding Of The Hon’Ble High Court Reads As Follows:-

For Appellant: Sri.Percy Pardiwala, Sr.Advocate, Sri.Anmol AnandFor Respondent: Sri.K.V.Aravind, Standing Counsel
Section 201Section 201(3)Section 9(1)(vi)

M/S Google India Private Limited, Bangalore vs. Dy. D.I.T., Bangalore

In the result, the appeals filed by the assessee are allowed

ITA 1514/BANG/2013[2010-11]Status: DisposedITAT Bangalore19 Oct 2022AY 2010-11

Bench: Shri George George K, Jm & Ms.Padmavathy S, Am It(Tp)A No.1513/Bang/2013 : Asst.Year 2009-2010 It(Tp)A No.1514/Bang/2013 : Asst.Year 2010-2011 It(Tp)A No.1515/Bang/2013 : Asst.Year 2011-2012 It(Tp)A No.1516/Bang/2013 : Asst.Year 2012-2013 M/S.Google India Private Limited The Deputy Commissioner Of No.3, Rmz Infinity Tower-E Income-Tax (International V. 4Th Floor, Old Madras Road Taxation), Circle 1(1) Bangalore. Bangalore – 560 016. Pan : Aaccg0527D. (Appellant) (Respondent) Appellant By : Sri.Percy Pardiwala, Sr.Advocate, Sri.Anmol Anand, Advocate, Miss.Priya Tandon, Advocate & Sri.Vinay Mangla, Ca Respondent By : Sri.K.V.Aravind, Standing Counsel Date Of Pronouncement : 19.10.2022 Date Of Hearing : 13.09.2022 O R D E R Per George George K, Jm : These Appeals At The Instance Of The Assessee Were Originally Disposed By The Itat Vide Its Common Order Dated 23.10.2017. On Further Appeal At The Instance Of The Assessee, The Hon’Ble High Court Vide Judgment Dated 17.04.2021 In Ita No.883/2017, 897/2017 To 899/2017, Restored The Matter To The Itat For De Novo Consideration. The Relevant Finding Of The Hon’Ble High Court Reads As Follows:-

For Appellant: Sri.Percy Pardiwala, Sr.Advocate, Sri.Anmol AnandFor Respondent: Sri.K.V.Aravind, Standing Counsel
Section 201Section 201(3)Section 9(1)(vi)

M/S Google India Private Limited, Bangalore vs. Dy. D.I.T., Bangalore

In the result, the appeals filed by the assessee are allowed

ITA 1513/BANG/2013[2009-10]Status: DisposedITAT Bangalore19 Oct 2022AY 2009-10

Bench: Shri George George K, Jm & Ms.Padmavathy S, Am It(Tp)A No.1513/Bang/2013 : Asst.Year 2009-2010 It(Tp)A No.1514/Bang/2013 : Asst.Year 2010-2011 It(Tp)A No.1515/Bang/2013 : Asst.Year 2011-2012 It(Tp)A No.1516/Bang/2013 : Asst.Year 2012-2013 M/S.Google India Private Limited The Deputy Commissioner Of No.3, Rmz Infinity Tower-E Income-Tax (International V. 4Th Floor, Old Madras Road Taxation), Circle 1(1) Bangalore. Bangalore – 560 016. Pan : Aaccg0527D. (Appellant) (Respondent) Appellant By : Sri.Percy Pardiwala, Sr.Advocate, Sri.Anmol Anand, Advocate, Miss.Priya Tandon, Advocate & Sri.Vinay Mangla, Ca Respondent By : Sri.K.V.Aravind, Standing Counsel Date Of Pronouncement : 19.10.2022 Date Of Hearing : 13.09.2022 O R D E R Per George George K, Jm : These Appeals At The Instance Of The Assessee Were Originally Disposed By The Itat Vide Its Common Order Dated 23.10.2017. On Further Appeal At The Instance Of The Assessee, The Hon’Ble High Court Vide Judgment Dated 17.04.2021 In Ita No.883/2017, 897/2017 To 899/2017, Restored The Matter To The Itat For De Novo Consideration. The Relevant Finding Of The Hon’Ble High Court Reads As Follows:-

For Appellant: Sri.Percy Pardiwala, Sr.Advocate, Sri.Anmol AnandFor Respondent: Sri.K.V.Aravind, Standing Counsel
Section 201Section 201(3)Section 9(1)(vi)