An Indian company pays a foreign supplier, parent or consultant, and deducts nothing. The invoice is settled, the money has left India, and a notice arrives two years later. From 1 April 2026 this sits in the Income-tax Act, 2025, where the withholding obligation on payments to non-residents is in Section 393(2) and the consequences of failure are in Section 398. The liability falls first on the Indian payer, but the recipient is rarely left untouched, because the payer usually looks to the contract to recover what it has paid. This note takes both sides in turn. The firm sets out the framework on its page on withholding tax on payments to non-residents.
