IMPORTANT INCOME TAX CASE LAWS 02.01.2026

Relevant Act	Section	Case Law Title	Brief Summary	Citation
Income-tax Act, 1961	Section 11	Goswami Bhagwan Lal Education Society v. ITO	Denial of exemption under Section 11 for non-filing of Form 10B without giving an opportunity to rectify the defect under Section 139(9) is a debatable issue and cannot be done via a summary adjustment under Section 143(1).	Click Here
Income-tax Act, 1961	Section 11	Krishna Janmashtmi Mahotsav Samiti v. ITO (Exemption)	Donations received for organizing Janmashtami Mahotsav (religious/cultural events) and spent on free meals/publicity for the event cannot be treated as business promotion receipts; they are consistent with the trust’s charitable objects.	Click Here
Income-tax Act, 1961	Section 35ABB	DCIT v. Bharti Hexacom Ltd.	Variable license fees paid to the Department of Telecommunications (DoT) under the New Telecom Policy 1999 are capital in nature and must be amortized under Section 35ABB.	Click Here
Income-tax Act, 1961	Section 37(1)	DCIT v. Bharti Hexacom Ltd.	Subscriber verification penalties paid to the DoT for violation of KYC norms are allowed as business expenditure under Section 37(1) (not treated as penalty for offence). Spectrum usage charges are also allowable revenue expenditure.	Click Here
Income-tax Act, 1961	Section 37(1)	Natural Capsules Ltd. v. ITO	Expenditure on share transfer work, listing fees, and reconciliation (not related to fresh capital issue) is allowable revenue expenditure. Similarly, costs for replacing minor equipment (magnetic enclosures) to prevent contamination do not create an enduring benefit and are revenue in nature.	Click Here
Income-tax Act, 1961	Section 68	Bhamiraben Prashantkumar Patel v. ITO	Reopening based on bogus LTCG from penny stocks was unjustified where the assessee demonstrated she was a bona fide investor, having held the scrip and even incurred losses in subsequent years.	Click Here
Income-tax Act, 1961	Section 69	DCIT v. Jagathrakshakan Srinisha	Addition for unexplained jewellery found at the father’s premises was deleted as the assessee explained the holdings through VDIS disclosures, family gifts, and drawings.	Click Here
Income-tax Act, 1961	Section 115BBE	DCIT v. Jagathrakshakan Srinisha	If an addition is sustained only as estimated business income (and not under S. 68-69D), the higher tax rate under Section 115BBE cannot be invoked via rectification under Section 154.	Click Here
Income-tax Act, 1961	Section 119	Sirez Ltd. v. Union of India	Delay of 30 months in filing a return due to an inter se dispute between directors was not condoned as the assessee failed to produce court records showing how the dispute actually prevented the filing.	Click Here
Income-tax Act, 1961	Section 132	Jigishaben Minesh Patel v. ACIT	Continued detention of seized jewellery after the assessee discharged her full tax liability (via Vivad Se Vishwas Scheme) was illegal. The department cannot hold it for the tax demand of a joint locker holder.	Click Here
Income-tax Act, 1961	Section 139	Exim Infrastructure India (P.) Ltd. v. CBDT	Successive resignation of key finance employees constitutes a “reasonable cause” for delay in filing the return. The CBDT was directed to condone the delay.	Click Here
Income-tax Act, 1961	Section 194H	DCIT v. Bharti Hexacom Ltd.	Section 194H (TDS on Commission) is not applicable to discounts allowed by telecom companies to distributors on prepaid instruments/SIM cards, as the relationship is principal-to-principal.	Click Here

For More :- Read IMPORTANT GST CASE LAWS 31.12.2025