IMPORTANT INCOME TAX CASE LAWS 24.01.2026

Relevant Act	Section	Case Law Title	Brief Summary	Citation
Income-tax Act, 1961	Section 6	Sanjay Bhaskar v. DCIT	[Stay in India] For determining residential status, the day of arrival in India is to be excluded when computing the total number of days of stay.	Click Here
Income-tax Act, 1961	Section 12AB	Rajah Annamalaipuram Temple Trust v. PCIT	[Portal Glitch Protection] A trust’s right to regular registration (5 years) cannot be defeated by technical limitations of the IT portal (e.g., restricted drop-down options). Authorities must process applications based on legal entitlement.	Click Here
Income-tax Act, 1961	Section 28(iv)	AMD India (P.) Ltd. v. DCIT	[Free Assets for Testing] Fixed assets received free of cost from a holding company solely for testing purposes (without claiming depreciation) do not constitute a taxable benefit/perquisite under Section 28(iv).	Click Here
Income-tax Act, 1961	Section 37(1)	ICICI Securities Ltd. v. PCIT	[Penalties vs compensatory charges] Charges paid for operational lapses under SEBI/Stock Exchange regulations are compensatory, not “penalties for violation of law.” Hence, they are deductible business expenses.	Click Here
Income-tax Act, 1961	Section 50C	Vanraj Ranchhoddas Merchant v. ITO	[Life Interest Assignment] Assigning a limited “life interest” in a trust property is not a transfer of land or building. Therefore, the deeming fiction of Section 50C (Stamp Duty Value) cannot be applied.	Click Here
Income-tax Act, 1961	Section 80G	ICICI Securities Ltd. v. PCIT	[CSR & 80G] Disallowing an expense as CSR under Section 37(1) does not create a bar on claiming it as a deduction under Section 80G, provided statutory conditions of the donation are met.	Click Here
Income-tax Act, 1961	Section 92C (TP)	ACIT v. Cargil India (P.) Ltd.	[CUP Method] For sugar imports (CIF), the CUP Method was correctly applied by converting CIF to FOB and using an average of NYBOT and Kingsman prices with a ±5% range.	Click Here
Income-tax Act, 1961	Section 92C (TP)	AMD India (P.) Ltd. v. DCIT	[Turnover Filter] Companies with turnovers 22 to 37 times higher than the assessee (and possessing high brand value) are not comparable to a captive software development service provider.	Click Here
Income-tax Act, 1961	Section 115BBE	Jagathesh v. ACIT	[Retroactive Rate Bar] The enhanced 60% tax rate under Section 115BBE is applicable only from AY 2018-19. It cannot be applied to unexplained money additions for AY 2017-18.	Click Here
Income-tax Act, 1961	Section 144C	Sun Pharmaceutical Industries v. DCIT	[DRP is Mandatory] Even if an assessment is set aside u/s 263 for a de novo frame, the AO must follow the draft assessment order (DRP) procedure u/s 144C for cases involving TP adjustments.	Click Here
Income-tax Act, 1961	Section 199	Ajay Kumar Goel v. DCIT	[TDS Recovery Protection] If an employer deducts TDS from salary but fails to deposit it, the Revenue cannot raise a demand against the employee. Recovery must be made from the employer.	Click Here

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