INCOME TAX CASE LAWS 18.08.2026
| Relevant Act | Section / Rule | Case Law Title / Update | Brief Summary | Citation |
| Finance Act, 2026 | Notification No. 114/2026 | Foreign Assets of Small Taxpayers Disclosure Scheme Rules, 2026 | Govt. notified the voluntary disclosure scheme rules and FAQs enabling eligible taxpayers to declare undisclosed foreign assets/income (open from 16-Aug-2026 to 31-Dec-2026). | Click Here |
| Income-tax Act, 1961 | Section 2(15) | CIT (Exemptions) v. Ahmedabad Urban Development Authority | Urban development authority’s activities for general public utility qualify as charitable; exemption under Sections 11 & 12 cannot be denied under proviso to Sec 2(15) r.w.s. 13(8). | Click Here |
| Income-tax Act, 1961 | Section 11 | CIT (Exemptions) v. Ahmedabad Urban Development Authority | Set-off of earlier years’ deficit/excess application is permissible; permissible 15% accumulation is to be computed after deducting application of income from gross receipts. | Click Here |
| Income-tax Act, 1961 | Section 12 | CIT (Exemptions) v. Ahmedabad Urban Development Authority | Grants received by a trust for generic or non-project-specific purposes constitute voluntary contributions and are includible as income u/s 12. | Click Here |
| Income-tax Act, 1961 | Section 12AB | Chaturbhuja Mata Mai Seva Trust v. CIT (Exemptions) | Rejection of renewal application u/s 12AB cannot be sustained merely on general observations regarding trust deed amendments without pointing out statutory non-compliance or granting proper notice. | Click Here |
| Income-tax Act, 1961 | Section 28(i) | SKF Engineering & Lubrication India (P.) Ltd. v. ACIT | Write-off of non-recoverable vendor advances (due to non-supply of materials) with undisputed business nexus is an allowable business loss u/s 28. | Click Here |
| Income-tax Act, 1961 | Section 32 | CIT (Exemptions) v. Ahmedabad Urban Development Authority | Depreciation u/s 32 is allowable on fixed assets used in activities akin to business carried out without commercial motive by an eligible charitable entity. | Click Here |
| Income-tax Act, 1961 | Section 32 | Royal Multisport (P.) Ltd. v. ACIT | Depreciation on IPL franchise rights is allowable on the entire capitalised contractual cost of the intangible asset, not just on the instalment paid during the year. | Click Here |
| Income-tax Act, 1961 | Section 32(1)(ii) | PCIT-1 v. Sabarkantha District Co. Op. Milk Producers Union Ltd. | Milk cans/equipment qualify as plant & machinery eligible for additional depreciation; balance 10% additional depreciation is allowable in the immediately succeeding year as per 3rd proviso. | Click Here |
| Income-tax Act, 1961 | Section 36(1)(iii) | L.K. Trust v. DCIT | Where assessee has sufficient interest-free funds and advances to sister concerns are for commercial purposes, presumption arises that interest-free funds were utilized; no disallowance warranted. | Click Here |
| Income-tax Act, 1961 | Section 37(1) | SKF Engineering & Lubrication India (P.) Ltd. v. ACIT | Relief fund contributions without business nexus are disallowable; however, repairs/racks for existing plants and fully documented housekeeping expenses are allowable revenue expenses. | Click Here |
| Income-tax Act, 1961 | Section 50D / Sec 43CA | L.K. Trust v. DCIT | In a JDA where land is converted to stock-in-trade, full value of consideration for constructed area received must be computed based on FMV / stamp guideline value, not developer’s construction cost. | Click Here |
| Income-tax Act, 1961 | Section 68 | Nisha Projects (P.) Ltd. v. DCIT | Reassessment treating loan as unexplained cash credit is valid where assessee failed to file return in response to Section 148 notice and participated in proceedings admitting notice issuance. | Click Here |
| Income-tax Act, 1961 | Section 68 / Sec 148 | Rajesh Sunderdas Vaswani v. DCIT | Reopening cannot be sustained solely on Suspicious Transaction Reports (STR) or suspicion when full books/details were furnished and no material shows transactions were bogus/accommodation. | Click Here |
| Income-tax Act, 1961 | Section 68 / Sec 148A | ACIT v. Mukesh Manubhai Shah | SLP dismissed; AO exceeded jurisdiction by conducting roving inquiries u/s 148A solely on high-value banking channel transactions where all party details were fully explained. | Click Here |
| Income-tax Act, 1961 | Section 69A / Sec 148 | Kanubhai Joitaram Patel v. ACIT | Reassessment based on vague/non-specific entries from a seized register with arbitrary rates applied prospectively without a live link lacks valid nexus and is liable to be quashed. | Click Here |
| Income-tax Act, 1961 | Section 80P(2)(d) | PCIT-1 v. Sabarkantha District Co. Op. Milk Producers Union Ltd. | Co-operative society is eligible for deduction u/s 80P(2)(d) on interest and dividend income derived from investments made with other co-operative entities. | Click Here |
| Income-tax Act, 1961 | Section 92C | Royal Multisport (P.) Ltd. v. ACIT | ALP of management fees paid to AE cannot be determined at nil merely on the ground of lack of perceived benefit; matter remanded for invoice verification. | Click Here |
| Income-tax Act, 1961 | Section 92CA | Royal Multisport (P.) Ltd. v. ACIT | Where international transactions exceed CBDT monetary limits, AO is mandatorily required to refer the matter to TPO; ALP determined without reference is unsustainable. | Click Here |
| Income-tax Act, 1961 | Section 115BAA | Mysim Therapeutics (P.) Ltd. v. ITO | Denial of concessional tax regime u/s 115BAA is unjustified when failure to file Form 10-IC/return on time was caused by genuine technical glitches. | Click Here |
| Income-tax Act, 1961 | Section 147 / Sec 147A | Nate Nandha v. ACIT | Reassessment proceedings initiated/continued by JAO between 1-4-2021 and 1-4-2024 are valid in light of the retrospective insertion of Section 147A. | Click Here |
| Income-tax Act, 1961 | Section 153C | Bhartiben Dharmeshbhai Gathani v. DCIT | Section 153C proceedings quashed where AO recorded the satisfaction note more than four years after the search instead of immediately after completing the searched person’s assessment. | Click Here |
| Income-tax Act, 1961 | Section 270A | Kavita Mamidi v. ACIT | Penalty for under-reporting/misreporting is not leviable u/s 270A(6) where salaried individual bona fide believed employer filed return, disclosed all income u/s 148, and income was subject to TDS. | Click Here |
| Income-tax Act, 1961 | Section 271(1)(c) | Hitesha Sachin Takur v. ITO | No penalty for concealment lies when return filed u/s 148 is accepted without addition and prepaid TDS exceeds the assessed tax liability. | Click Here |
| Income-tax Act, 2025 | Section 365 | Airports Authority of India v. DCIT | Tribunal’s ex parte order passed without service of hearing notice violates Rule 20 and principles of natural justice; matter remanded for fresh hearing. | Click Here |