INCOME TAX CASE LAWS 03.09.2026

Relevant Act	Section	Case Law Title	Citation	Brief Summary
Prohibition of Benami Property Transactions Act, 1988	Section 2(9)	Alishan Complex (P.) Ltd. v. Initiating Officer	Click Here	Retracted statement of a CA recorded during search without cross-examination could not be relied upon to allege benami cash routing where pre-existing reserves were backed by documents; matter remanded for fresh determination.
Income-tax Act, 1961	Section 2(24)	Aditya Birla Real Estate Ltd. v. Commissioner of Income-tax	Click Here	Accounting treatment under Ind AS 20 crediting EPCG export-linked government grants to P&L does not override the Act; mere credit to P&L does not make it taxable income.
Income-tax Act, 1961	Section 4	Nain Krupa Premises Co-operative Society Ltd. v. Assessing Officer	Click Here	Maintenance and tax recoveries collected exclusively from members and applied for collective benefit meet mutuality tests; surplus is non-taxable under the doctrine of mutuality.
Income-tax Act, 1961	Section 5	Aditya Birla Real Estate Ltd. v. Commissioner of Income-tax	Click Here	Notional rental income credited under Ind AS without real income accrual or deduction of amortisation can be neutralized via ICDS IV; additions based solely on P&L reflection are invalid.
Income-tax Act, 1961	Section 10(37)	Venkata Siddi Raju Subramanyam Raju Konduru v. ACIT	Click Here	Enhanced compensation received on compulsory acquisition of agricultural land where agricultural operations and title were substantiated qualifies for full exemption under Section 10(37).
Income-tax Act, 1961	Section 35	Aditya Birla Real Estate Ltd. v. Commissioner of Income-tax	Click Here	Weighted deduction under Section 35(2AB) cannot be denied solely due to non-issuance of Form 3CL by the authority when Form 3CM approval for the in-house R&D facility is valid.
Income-tax Act, 1961	Section 36(1)(iii)	Aditya Birla Real Estate Ltd. v. Commissioner of Income-tax	Click Here	Differences in borrowing cost capitalisation arising between Ind AS and ICDS IX methodologies cannot justify disallowance absent evidence of an actual double deduction.
Income-tax Act, 1961	Section 36(1)(iv)	Principal Commissioner of Income-tax v. Syama Prasad Mookherjee Port	Click Here	Special contributions paid to an approved Superannuation Fund to bridge actuarial deficits are remedial and fall outside the 27% statutory ceiling applicable to ordinary annual contributions under Rule 87.
Income-tax Act, 1961	Section 36(1)(vii)	PPG Asian Paints (P.) Ltd. v. Deputy Commissioner of Income-tax	Click Here	Disallowance of provisions for bad and doubtful debts overturned in light of applicable judicial precedents governing allowable bad debt claims.
Income-tax Act, 1961	Section 37(1)	PPG Asian Paints (P.) Ltd. v. Deputy Commissioner of Income-tax	Click Here	Ad hoc disallowance of business expenses paid via banking channels with partial vouchers set aside to grant assessee opportunity to file complete evidentiary backing.
Income-tax Act, 1961	Section 37(1)	Aditya Birla Real Estate Ltd. v. Commissioner of Income-tax	Click Here	Claim of business expenditure on gifts distributed to employees and clients remanded to AO to examine business purpose, nexus, and supporting documentation.
Income-tax Act, 1961	Section 37(1)	Deputy Commissioner of Income Tax v. Bajaj Finserv Direct Ltd.	Click Here	Digital sales promotion expenses including SEO, content generation, and online ads do not create enduring capital assets; allowable fully as recurring revenue expenditure.
Income-tax Act, 1961	Section 37(1)	Deputy Commissioner of Income Tax v. Bajaj Finserv Direct Ltd.	Click Here	Vendor IT service expenses enhancing website user experience (search indexing, spell-check, product sorting) are integral to digital business operations and deductible as revenue expenditure.
Income-tax Act, 1961	Section 43B	Aditya Birla Real Estate Ltd. v. Commissioner of Income-tax	Click Here	Leave encashment provision remanded to AO for limited factual verification; duplicate disallowance cannot stand if already added back in the computation under Section 43B.
Income-tax Act, 1961	Section 45	Venkata Siddi Raju Subramanyam Raju Konduru v. ACIT	Click Here	Inadvertent reporting of capital gains on office sale as STCG can be reclassified as LTCG where verified holding period satisfies long-term statutory thresholds.
Income-tax Act, 1961	Section 48	Aditya Birla Real Estate Ltd. v. Commissioner of Income-tax	Click Here	AO’s determination of TDR cost of acquisition as nil on compulsory land surrender set aside; fair market value computation of TDRs requires fresh assessment.
Income-tax Act, 1961	Section 115BBI	Council for Fair Business Practices v. Income-tax Officer	Click Here	Valid application of accumulated income shown in revised Form 10-BB without violation of Section 11(2) cannot be taxed under Section 115BBI merely for reporting mismatches.
Income-tax Act, 1961	Section 132	Income-tax Department v. Vikas Chaudhary	Click Here	Look Out Circular (LOC) issued on grounds of undisclosed foreign assets, hawala transactions, and bogus export claims sustained; not open to quashing when grounded in substantial search material.
Income-tax Act, 1961	Section 143	PPG Asian Paints (P.) Ltd. v. Deputy Commissioner of Income-tax	Click Here	Enhancements in regular assessment made by relying on an unserved Section 143(1) intimation are invalid; remanded to provide proper notice and opportunity of hearing.
Income-tax Act, 1961	Section 145	Aditya Birla Real Estate Ltd. v. Commissioner of Income-tax	Click Here	Upfront operational rights royalty offered fully to tax in year of receipt cannot be taxed again as amortised revenue under Ind AS in subsequent years, preventing double taxation.
Income-tax Act, 1961	Section 147	Yash Nirupam Nanavaty v. Income-tax Officer	Click Here	Reassessment notice under Section 148 issued against a deceased individual despite intimation of death is void ab initio, without jurisdiction, and liable to be quashed.
Income-tax Act, 1961	Section 148A	Shanmugha Arts, Science Technology and Research Academy v. ACIT (Exemptions)	Click Here	Reassessment proceedings initiated after 01.04.2021 without adhering to the limitation periods prescribed under amended Section 148A read with TOLA are barred by limitation.
Income-tax Act, 1961	Section 194C	Deputy Commissioner of Income-tax (TDS) v. Pfizer Ltd.	Click Here	Year-end ad hoc expense provisions without identifiable payees, reversed in the subsequent period with TDS deducted upon crystallization, do not attract Section 201(1) defaults.
Income-tax Act, 1961	Section 201	Deputy Commissioner of Income-tax (TDS) v. Pfizer Ltd.	Click Here	Where the assessee has already disallowed 30% of expenditure under Section 40(a)(ia) for non-deduction of TDS, treating the assessee as in default under Section 201(1) for the same default is unsustainable.
Income-tax Act, 1961	Section 234A	PPG Asian Paints (P.) Ltd. v. Deputy Commissioner of Income-tax	Click Here	Consequential interest levied under Sections 234A, 234B, 234C and penalties under Section 270A set aside for fresh adjudication following re-examination of primary assessment issues.
Income-tax Act, 1961	Section 234F	Nain Krupa Premises Co-operative Society Ltd. v. Assessing Officer	Click Here	Late fee under Section 234F is not leviable when a co-operative society required to get accounts audited files its return within the extended audit due date of October 31.
Income-tax Act, 1961	Section 270A	Assistant Commissioner of Income-tax v. Discovery Networks Asia-pacific Pte Ltd.	Click Here	Under-reporting penalty under Section 270A deleted where full disclosure was made under DTAA on a bona fide debatable issue and the statutory notice failed to specify the charge.
Income-tax Act, 1961	Section 271(1)(c)	Commissioner of Income-tax v. Nirma Ltd.	Click Here	Concealment penalty under Section 271(1)(c) is not attracted where the disallowance of interest on Secured Premium Notes involved a bona fide, debatable legal issue.