<h1>Mumbai High Court Clarifies Tax Responsibilities in Foreign M&A Transactions Involving Indian Assets u/ss 191 and 201.</h1> The High Court of Mumbai ruled on the taxability of a foreign merger and acquisition transaction involving assets in India. The appellant argued that income tax should be paid by the recipient, not the payer, except in specific cases where the payer is deemed an 'assessee in default' (AID) under Indian law. The court examined the applicability of sections 191 and 201 of the Income Tax Act, emphasizing that failure to deduct tax can lead to penalties but does not transfer tax liability to the payer. The court found that the transaction involved assets in India and held that the show cause notice was valid, requiring further investigation into the facts and agreements involved.