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

DCIT, Cir-12(2), Kolkata vs. M/S. Selvel Media Services Pvt. Ltd., Kolkata

In the result, the appeal filed by the Revenue ( Ground No

ITA 2205/KOL/2014[2011-2012]Status: DisposedITAT Kolkata30 Aug 2017AY 2011-2012

Bench: Shri N. V. Vasudevan, Jm & Dr. A.L.Saini, Am आयकर अपील सं./Ita No.2205/Kol/2014 (िनधा"रण वष" / Assessment Year: 2011-12 D.C.I.T, Cirle-12(2), Vs. M/S Selvel Media Services Pvt. Ltd. Kolkata 10/1B, Diamond Harbour Road, Kolkata – 700 027. "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aadcs 7951 G (Revenue/Department) .. (Assessee) Assessee By :Shri Subash Agarwal, Advocate Revenue/Department By :Shri G. Mallikarjuna, Cit Dr सुनवाई की तारीख / Date Of Hearing : 13/07/2017 घोषणा की तारीख/Date Of Pronouncement : 30/08/2017 आदेश / O R D E R Per Dr. Arjun Lal Saini, Am: The Captioned Appeal Filed By The Assessee, Pertaining To Assessment Year 2011-12, Is Directed Against The Order Passed By The Ld. Commissioner Of Income Tax (Appeals)–Xii, Kolkata, In Appeal No.237/Xii/Cir-12/14-15 Dated 17.09.2014, Which In Turn Arises Out Of An Order Passed By The Assessing Officer U/S.143(3) Of The Income Tax Act 1961, (Hereinafter Referred To As The ‘Act’), Dated 20.03.2014. 2. Revenue Has Taken The Following Grounds Of Appeal: 1. “That In The Facts & Circumstances Of The Case & In The Law The Ld. Cit(A) Erred In Deleting The Disallowance Of Rs. 1,42,76,824/- Made By The A.O. On Depreciation On Hoarding Structures.” 2. “That In The Facts & Circumstances Of The Case & In The Law The Ld. Cit(A) Erred In Deleting The Disallowance Of Rs. 1,66,53,847/- Made By The A.O. On Account Of Deduction U/S. 80-Ia.”

For Appellant: Shri Subash Agarwal, AdvocateFor Respondent: Shri G. Mallikarjuna, CIT DR
Section 143(1)Section 143(2)Section 143(3)Section 40Section 80