27 February 2008
The Tribunal had ruled that Eli Lilly India need not pay tax on salaries given to its expatriates by a different entity outside India. It had further held that under Section 191 of Income Tax Act, the expatriates were liable to pay tax directly where tax at source (TDS) had not been deducted.
The income tax authorities had sought levy of around Rs 4.96 crore (Rs 49.6 million) on the ground that the joint venture had failed to deduct TDS on salaries paid abroad to its four expatriate employees who have been on its roll since its inception.