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Section204
The Income-tax Act, 1961

Meaning of "person responsible for paying"

Repealed From 01 Apr 1962 Act 43 of 1961 As on 17 Oct 2026

Act 43 of 1961 Ministry Finance Enacted 13 Sep 1961 In force 01 Apr 1962 Cited by 11 provisions

This provision is repealed. Repealed by the Income-tax Act, 2025 with effect from 1 April 2026. It is reproduced because conduct before that date is still charged, tried and appealed under it.

Section 204 of the Income-tax Act, 1961 deals with meaning of "person responsible for paying". For the purposes of the foregoing provisions of this Chapter and section 285, the expression "person responsible for paying" means— (i) in the case of payments of income chargeable under the head "Salaries", other than payments by the Central Government or the Government of a State, the employer him The Act came into force on 01 Apr 1962. Repealed by the Income-tax Act, 2025 with effect from 1 April 2026, but conduct before that date is still charged, tried and appealed under it.

For the purposes of the foregoing provisions of this Chapter and section 285, the expression "person responsible for paying" means—

(i) in the case of payments of income chargeable under the head "Salaries", other than payments by the Central Government or the Government of a State, the employer himself or, if the employer is a company, the company itself, including the principal officer thereof;

(ii) in the case of payments of income chargeable under the head "Interest on securities", other than payments made by or on behalf of the Central Government or the Government of a State, the local authority, corporation or company, including the principal officer thereof; (iia) in the case of any sum payable to a non-resident Indian, being any sum representing consideration for the transfer by him of any foreign exchange asset, which is not a short-term capital asset, the authorised person responsible for remitting such sum to the non-resident Indian or for crediting such sum to his Non-resident (External) Account maintained in accordance with the Foreign Exchange Management Act, 1999 (42 of 1999), and any rules made thereunder; (iib) in the case of furnishing of information relating to payment to a non-resident, not being a company, or to a foreign company, of any sum, whether or not chargeable under the provisions of this Act, the payer himself, or, if the payer is a company, the company itself including the principal officer thereof;

(iii) in the case of credit, or, as the case may be, payment of any other sum chargeable under the provisions of this Act, the payer himself, or, if the payer is a company, the company itself including the principal officer thereof;

(iv) in the case of credit, or as the case may be, payment of any sum chargeable under the provisions of this Act made by or on behalf of the Central Government or the Government of a State, the drawing and disbursing officer or any other person, by whatever name called, responsible for crediting, or as the case may be, paying such sum;

(v) in the case of a person not resident in India, the person himself or any person authorised by such person or the agent of such person in India including any person treated as an agent under section 163.

Explanation.—For the purposes of this section,—

(a) "non-resident Indian" and "foreign exchange asset" shall have the meanings assigned to them in Chapter XII-A;

(b) "authorised person" shall have the meaning assigned to it in clause (c) of section 2 of the Foreign Exchange Management Act, 1999 (42 of 1999).

Bar against direct demand on assessee.

Section 204, The Income-tax Act, 1961 (Act 43 of 1961).

Now in the Income-tax Act

INCOME-TAX-ACT-2025 402 Interpretation Official correspondence

Measured by comparing the text of the two provisions, not taken from an official correspondence table — there is no machine-readable one. See both texts side by side before relying on it.

Both regimes are live. The repealed enactment still governs what happened while it was in force. We never redirect one to the other.

Cross-references

Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.

This section refers to

  1. Foreign Exchange Management Act s. 2 Definitions
  2. s. 163 Who may be regarded as agent
  3. s. 285 Submission of statement by a non-resident having liaison office

Referred to by 11

  1. Finance Act s. 31 Amendment of section 204
  2. Finance Act s. 32 Amendment of section 204
  3. Finance Act s. 61 Amendment of section 204
  4. Finance Act s. 43 Amendment of sections 198 to 200 and 202 to 205
  5. Finance Act s. 40 Amendment of sections 198 to 200 and 202 to 205
  6. Finance Act s. 78 Amendment of section 198 to 200, 202 to 203A, 204 and 205
  7. Finance Act s. 47 Amendment of section 204
  8. Finance Act s. 80 Amendment of section 204
  9. Finance Act s. 71 Amendment of section 204
  10. Finance Act s. 93 Amendment of Section 204
  11. Finance Act s. 58 Amendment of section 204

Related judgements & precedents

These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.

  1. Commr. of Income Tax, Delhi vs Alcatel South Asia Pacific

    Supreme Court of India 25 Mar 2009 Binding (Supreme Court Division Bench) Reportable

    Court's Decision & Legal Precedent

    Tax Deduction at Source (TDS) provisions in Chapter XVII-B of the Income Tax Act, 1961, which are machinery provisions enabling collection and recovery of tax, are NOT independent of the charging provisions that determine assessability of income in the hands of the employee. Instead, TDS provisions form an integrated code with the charging and computation provisions. Consequently, when any income falls under the head "Salaries" and is deemed to accrue or arise in India under Section 9(1)(ii) (i.e., earned in India through services rendered in India), the TDS obligation under Section 192(1) applies to any person responsible for paying such income, regardless of whether the payment is made inside or outside India. The obligation is to deduct tax on the basis of the estimated income of the employee under the head "Salaries" for that financial year. When multiple employers pay salary to the same employee for services rendered in India, all such payments are part of the income chargeable under head "Salaries" in India, and TDS applies. Section 192(1) must be read conjunctively with Section 9(1)(ii) and the Explanation thereto.

    On this section: Defines "person responsible for paying" salary as either employer or, if company, the company itself including its principal officer

    Read the full order on eCourts India

The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.

Questions about Section 204

What have the courts held on Section 204 of the Income-tax Act?

Commr. of Income Tax, Delhi vs Alcatel South Asia Pacific (25 Mar 2009) is the leading judgment on this section among those set out below: Defines "person responsible for paying" salary as either employer or, if company, the company itself including its principal officer.

How do I find court cases under Section 204 of the Income-tax Act?

In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Income Tax Act 204, section 204 Income Tax Act, section 204 of the Income-tax Act. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 1 reported judgment on this section is set out on this page, beginning with Commr. of Income Tax, Delhi vs Alcatel South Asia Pacific (25 Mar 2009).

What should I read with Section 204 of the Income-tax Act, and has it changed?

Its own text turns on Foreign Exchange Management Act 2 (Definitions), section 163 (Who may be regarded as agent), section 285 (Submission of statement by a non-resident having liaison office), so none of them can safely be read on its own. 11 other provisions in this corpus refer back to it. For anything done on or after 1 April 2026 the provision to read is Income-tax Act, 2025, section 402 (Interpretation), which replaced it; conduct before that date is still charged, tried and appealed under this section.

When did Section 204 of the Income-tax Act come into force?

Section 204 of the Income-tax Act, cited as Income Tax Act 204, came into force on 01 Apr 1962, having been enacted on 13 Sep 1961. It is no longer in force.

Other sections of this Act

Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Recovered from the consolidated text published by the Income Tax Department, as amended by the Finance Act, 2026. India Code holds no record of this Act in any form. This page is not a substitute for legal advice.