IMPORTANT INCOME TAX CASE LAWS 03.02.2026 Section Case Law Core Ruling & Strategic Summary Citation S. 11 / 11(3) AWARE (Hyderabad Trib.) [Accumulation Audit] Deletion of an addition u/s 11(3) is invalid if the appellate authority fails to verify the actual utilization of brought-forward accumulated funds (₹1.24 Cr). Click Here S. 12AB / 80G Kush… Read More »
Coal Import Disputes: Remand on Shortages and TP Adjustments, Victory on TDS Credit The Legal Issue The case involves three distinct issues for AY 2008-09: The allowability of business expenditure for “shortages and quality cuts” in coal imports from an Associated Enterprise (AE). The validity of Transfer Pricing (TP) adjustments when credit notes (discounts) are… Read More »
Spouse’s Bank Account Cannot Be Attached for Company Tax Dues The Legal Issue The primary legal question is whether the Income Tax Department can invoke Section 226 (Recovery of Tax) or Section 179 (Liability of Directors of Private Company) to attach the personal bank account of a director’s spouse to satisfy the tax liabilities of… Read More »
Reassessment Quashed: Audit Objections Cannot Override a “Threadbare” Original Inquiry The Legal Issue The primary legal dispute is whether the Income Tax Department can reopen a completed assessment under Section 147 based solely on an audit objection, especially when the Assessing Officer (AO) had already conducted a “threadbare” inquiry into the same issue during the… Read More »
Insurance Business: Excess Management Expenses Allowed as Business Expenditure The Legal Issue The primary question was whether management expenses incurred by a general insurance company in excess of the limits prescribed by IRDAI Regulations can be disallowed under Section 37(1) or its Explanation 1 (expenditure for an offence or prohibited by law), given the specific… Read More »
Registration Under Section 12AB: Tribunal Cannot Grant Approval Without Verifying Activities The Legal Issue The core legal question is whether the Income Tax Appellate Tribunal (ITAT) can directly order the Commissioner (Exemptions) to grant final registration under Section 12AB and approval under Section 80G without first recording specific findings on the genuineness of the trust’s… Read More »
Accumulation and Utilization of Income under Section 11 This case pertains to the Assessment Year (AY) 1995-96 involving an assessee-society claiming exemption for its charitable activities. The core of the dispute lies in the interpretation of Section 11(2) (Accumulation of Income) and Section 11(3) (Consequences of non-utilization or mis-utilization of such income). The Legal Issue… Read More »
Section 170A: Modified Return Must Be Considered in Pending Assessment Proceedings The Legal Issue The central question is whether the Assessing Officer (AO) is required to consider a modified return filed under Section 170A within the ongoing (pending) assessment proceedings, or whether the AO can ignore it, pass an assessment order on the old return,… Read More »
FMCG Anti-Profiteering: Failure to Reduce Prices After Rate Cut Leads to Recovery Order The Legal Issue The primary legal issue is the application of Section 171 regarding “commensurate reduction” in prices. Specifically, whether a supplier can maintain the same Maximum Retail Price (MRP) after a tax rate reduction (from 28% to 18%) by citing “commercial… Read More »
Delhi High Court Remands Real Estate Anti-Profiteering Probe Over Faulty Methodology The Legal Issue The central legal issue is whether the Director General of Anti-Profiteering (DGAP) is justified in using a generic “ratio-based” methodology (comparing ITC to turnover) to calculate profiteering, or if it must adopt an “item-wise” data approach when requested by a developer.… Read More »