IMPORTANT INCOME TAX CASE LAW 29.10.2025

Section	Case Law Title	Brief Summary	Citation	Relevant Act
Section 11	Masoomeen Education Society v. Commissioner (Appeals), Sangli	The claim for exemption under Section 11 cannot be denied merely for delay in filing the audit report if the assessee-trust uploaded Form No. 10B within the time allowed by the CPC.	Click Here	Income-Tax Act, 1961
Section 14A	HDFC Bank Ltd. v. Deputy Commissioner of Income-tax	Where the assessee made suo motu disallowance under section 14A, the Assessing Officer (AO) could invoke Rule 8D only after recording objective dissatisfaction with the assessee’s accounts.	Click Here	Income-Tax Act, 1961
Section 14A	HDFC Bank Ltd. v. Deputy Commissioner of Income-tax	The value of shares held as stock-in-trade must be excluded while computing disallowance under section 14A.	Click Here	Income-Tax Act, 1961
Section 37(1)	HDFC Bank Ltd. v. Deputy Commissioner of Income-tax	ESOP discount (difference between market price and grant price at exercise) is allowable as business deduction under section 37(1).	Click Here	Income-Tax Act, 1961
Section 37(1)	Colgate Palmolive (India) Ltd. v. Principal Commissioner of Income-tax	Where the AO thoroughly examined and allowed ESOP expenses under section 37(1), the PCIT’s initiation of revision under section 263, alleging lack of proper enquiry, was unjustified and liable to be quashed.	Click Here	Income-Tax Act, 1961
Section 37(1)	Deputy Commissioner of Income-tax v. AIA Engineering Ltd.	Explanation 3 to section 37(1), which includes violations of laws outside India, was inserted with effect from 1-4-2022 and is applicable prospectively, not retrospectively.	Click Here	Income-Tax Act, 1961
Section 37(1)	Deputy Commissioner of Income-tax v. AIA Engineering Ltd.	Payment of USD 6 million to a private party to settle a long-pending civil litigation, which was not a fine or for an offense, was allowed as business expenditure under section 37(1).	Click Here	Income-Tax Act, 1961
Section 48 & 50C & 55A	Harshadkumar Hargovandas Patel v. Income-tax Officer	Matter remanded back to AO for fresh examination where cost of improvement/transfer expenses were disallowed solely on assumptions and for fresh determination of sale consideration under section 50C and reference to DVO under section 55A (for FMV as on 1-4-1981).	Click Here	Income-Tax Act, 1961
Section 50C	Bhupendrabhai Bhikhalal Patel v. Income-tax Officer	Where the assessee disputed the stamp duty valuation as excessive, the AO was required to refer the matter to the Departmental Valuation Officer; the matter was remanded for fresh determination and recomputation of capital gains.	Click Here	Income-Tax Act, 1961
Section 68 & 153D	Tremendous Mining And Minerals (P). Ltd v. Deputy Commissioner of Income-tax	Reopening of assessment on the basis that share application money was unexplained cash credit under section 68, where all documents were provided during scrutiny, was based on stale information and amounted to a reopening for convenience by change of opinion. Reopening of assessment after completion under section 153A does not attract section 153D approval.	Click Here	Income-Tax Act, 1961
Section 80G	Colgate Palmolive (India) Ltd. v. Principal Commissioner of Income-tax	Where the AO allowed deduction under section 80G for donations, including CSR expenses, after due consideration, the PCIT’s invocation of revision proceedings under section 263 alleging lack of proper enquiries was unjustified.	Click Here	Income-Tax Act, 1961
Section 80G	HDFC Bank Ltd. v. Deputy Commissioner of Income-tax	CSR expenditure incurred as per section 135 of the Companies Act, 2013 is allowable as a deduction under section 80G.	Click Here	Income-Tax Act, 1961
Section 149	Independent and Public Spirited Media Foundation v. Assistant Commissioner of Income-tax	Reopening notice issued beyond the period of limitation (about five years later), alleging payment of legal/professional fees without actual services, was liable to be quashed, where the original assessment was completed after the assessee filed a return.	Click Here	Income-Tax Act, 1961
Section 254	Hindustan Sports Club Ltd. v. Income-tax Officer	Tribunal rightly dismissed the application for recall under section 254(2) where no mistake apparent from the record was found, as section 254(2) cannot be invoked to review alleged violations arising from an assessment order passed prior to a scheduled hearing date.	Click Here	Income-Tax Act, 1961

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