IMPORTANT INCOME TAX CASE LAWS 03.01.2026 Relevant Act Section Case Law Title Brief Summary Citation Income-tax Act, 1961 Section 4 Vishnu Trimbak Thakur v. PCIT-1 Self-assessment tax paid on undisclosed income under the Income Declaration Scheme (IDS), 2016 (which was deemed rejected) is “inextricably linked” to that income. Credit for such tax must be given… Read More »
Limitation Period is Sacrosanct: Section 148 Notice for AY 2013-14 Issued on 31.07.2022 Held Invalid as Issued Beyond ‘Surviving Time’ Under Reassessment Scheme ISSUE Whether a notice under Section 148 dated 31.07.2022, issued for Assessment Year 2013-14 pursuant to the procedure under Section 148A (following the Supreme Court’s Ashish Agarwal directions), is valid, or… Read More »
Reassessment Against Deceased Assessee Set Aside: Department Cannot Continue Proceedings Against Dead Person After Receiving Intimation of Death; Liberty Granted to Issue Fresh Notice to Legal Heirs ISSUE Whether an assessment order passed in the name of a deceased assessee is valid when the Assessing Officer (AO) was informed of the death during the… Read More »
Reassessment Invalid Where AO Relies Solely on Suspicious Transaction Report (STR) and Ignores Assessee’s Detailed Reply and Evidence Regarding Related Party Transactions ISSUE Whether the Assessing Officer (AO) can validly pass an order under Section 148A and issue a reopening notice under Section 148 solely based on inputs from a Suspicious Transaction Report (STR)… Read More »
Rejection of Section 132B Application Void for Want of Jurisdiction: High Court Quashes Order Passed in Contravention of MP High Court Directions and Remands Matter to Jurisdictional AO in Mumbai ISSUE Whether an order rejecting an application for the release of seized jewellery under Section 132B is valid if passed by an Assessing Officer… Read More »
Co-operative Societies: Interest on Statutory Compulsory Deposits Qualifies for 80P Deduction; Section 80P(4) Not Applicable to Societies Without RBI License ISSUES Statutory Deposits: Whether interest income earned by a co-operative society from bank investments made under statutory compulsion (Karnataka Co-operative Societies Act) qualifies for deduction under Section 80P(2)(a)(i) as operational income, or is it taxable… Read More »
Reassessment Remanded: Addition for Unexplained Investment in Securities Set Aside for Verification of Duplicate Reporting (NSE vs. NSDL/Bank Data) ISSUE Whether the Assessing Officer (AO) was justified in making separate additions under Section 69 for “purchase of securities” based on NSE data and “transactions reported in Form 61B” (Statement of Reportable Account) without verifying… Read More »
Date of Issuance Prevails Over Date of Signing: Section 148 Notice Issued on 01-04-2021 Without Following New Section 148A Procedure is Invalid ISSUE Whether a reassessment notice under Section 148, which was digitally signed by the Assessing Officer on 31.03.2021 (under the old regime) but was actually issued/emailed via the ITBA portal on 01.04.2021 (when… Read More »
Section 43B Allowability: Customs Duty Paid Under Protest Constitutes “Actual Payment” and is Deductible; Disallowance Would Cause Double Taxation if Refund is Taxed Later ISSUE Whether the payment of Customs Duty made by the assessee “under protest” upon a demand raised by authorities qualifies as an allowable deduction under Section 43B in the year of… Read More »
Ad-hoc Disallowance Based on “Increase in Expenses” Invalid; Turnover Difference Due to Rounding Off Deleted; TDS Disallowance Upheld for Lack of Auditor’s Rectification ISSUES Ad-hoc Disallowance: Whether the Assessing Officer (AO) is justified in making a flat 50% disallowance on miscellaneous expenses (meetings/AGM) merely because the amount increased compared to the previous year, despite… Read More »