JUDGMENT

S.H. Kapadia, J.—

1. Delay condoned.

2. Leave granted.

3. In this batch of civil appeals, the question which arises for determination is - whether TDS provisions in Chapter XVII-B, which are in the nature of machinery provisions to enable collection and recovery of taxes, are independent of the charging provisions which determines the assessability of income chargeable under the head “Salaries” in the hands of the recipient? Broadly stated, we have cases in which the tax-deductor-assessee(s) has not deducted tax at source on the Home Salary/special allowance(s) (education allowance or retention) payments made by the Foreign Company/HO to its employees (expatriates to India) outside India in foreign currency.

I. Facts in Civil Appeal No. 5114/07: [CIT v. M/s Eli Lilly & Co. (I) Pvt. Ltd.]

4. Assessee was engaged in manufacturing and selling pharmaceutical products during the financial years 1992-93 to 1999-00. In the course of survey under Section 133A of the Income-tax Act, 1961 (“1961 Act” for short), the AO noticed that the foreign company had seconded four expatriates to the Joint Venture in India; that, the tax-deductor-assessee was a Joint Venture Company; that, the