IMPORTANT INCOME TAX CASE LAWS 04.12.2025
| Section | Case Law Title / Notification | Brief Summary | Citation | Relevant Act |
| Section 80G) | Income Tax NOTIFICATION NO. 166 / 2025, DATED 02-12-2025 | CBDT notified ‘Shree Balakrishna Lalji & other deities temple’, Bhuleshwar, Mumbai, as a place of historic importance and public worship of renown for the purpose of Section 80G exemption (deduction for donations). | NOTIFICATION NO. 166 / 2025, DATED 02-12-2025 | Income-tax Act, 1961 |
| Section 2(9) | Deputy Commissioner of Income-tax v. Dhanrishi Commosales (P.) Ltd. | Property purchased in a company’s name using routed funds, where the funding company neither got shares nor had a loan agreement, making advances time-barred. The shareholders/directors who took over the property indirectly became beneficial owners, classifying the transaction as a benami transaction under Section 2(9)(A). | Click Here | Prohibition of Benami Property Transactions Act, 1988 |
| Section 2(15) | GIA India v. Income-tax Officer (Exemptions) | Assessee, a non-profit company, imparted systematic instructions in gemmology and related fields. This activity was held to amount to ‘education’ within Section 2(15), making the denial of exemption under Section 11 unsustainable, despite no affiliation to a recognized authority. | Click Here | Income-tax Act, 1961 |
| Section 4 | Sterling Holiday Resorts Ltd. v. Deputy Commissioner of Income-tax | Where an assessee engaged in a time-share business consistently recognized only part of the membership fee as income in the year of receipt and deferred the remainder, and this policy was accepted by the Tribunal in earlier years, the addition of the deferred income to taxable income for the current year was not justified. | Click Here | Income-tax Act, 1961 |
| Section 9 | Cognizant Technology Solutions India (P.) Ltd. v. Commissioner of Income-tax | Payments made by the assessee-company to a foreign company for availing International Private Leased Circuits (IPLC) services were held not to constitute royalty, as Explanations to Section 9 (Finance Act, 2012) were not applicable to the pre-amendment assessment years. | Click Here | Income-tax Act, 1961 |
| Section 10A | Cognizant Technology Solutions India (P.) Ltd. v. Commissioner of Income-tax | Loss of eligible Section 10A units could be set-off against other income of the taxpayer. Also, interest on employee loans and sale of scrap (arising in the ordinary course of the export business) were entitled to 100\% exemption/deduction under Section 10A/10B. | Click Here | Income-tax Act, 1961 |
| Section 32 | Deputy Commissioner of Income-tax v. Echjay Industries (P). Ltd. | Goodwill recorded upon amalgamation, representing the excess of consideration over net assets, was held to constitute an intangible asset eligible for depreciation under Section 32(1)(ii). | Click Here | Income-tax Act, 1961 |
| Section 37(1) | Sterling Holiday Resorts Ltd. v. Deputy Commissioner of Income-tax | Disallowance of Employee Stock Option Plan (ESOP) expenditure was deleted by applying the principle of judicial consistency, as identical expenditure had been allowed by the Tribunal in earlier years. | Click Here | Income-tax Act, 1961 |
| Section 37(1) | SAP India (P.) Ltd. v. Deputy Commissioner of Income-tax | Following precedent in the assessee’s own case, employee stock compensation cost (ESOP expenditure) was held to be allowable under Section 37 despite being disallowed by the A.O. as capital and notional. | Click Here | Income-tax Act, 1961 |
| Section 40(a)(i) | Cognizant Technology Solutions India (P.) Ltd. v. Commissioner of Income-tax | Payments made to a USA company for IPLC services could not be disallowed under Section 40(a)(i) for non-deduction of tax at source, as the disallowance provision is discriminatory and not applicable in terms of Article 26(3)of the India – USA DTAA (Non-Discrimination Clause). | Click Here | Income-tax Act, 1961 |
| Section 44AE | Kulandaivel Thaalamuthu v. Assistant Commissioner of Income-tax | Assessee owning not more than ten LPG goods carriages during the year was prima facie computable under the presumptive scheme of Section 44AE, not Section 44AD. Rectification to apply Section 44AE(2) was justified. | Click Here | Income-tax Act, 1961 |
| Section 48 | Sterling Holiday Resorts Ltd. v. Deputy Commissioner of Income-tax | Where the assessee failed to provide the collector or circle rate to substantiate the Fair Market Value (FMV) as of 01.04.2001 for Long-Term Capital Loss calculation, the matter was remanded to re-determine the capital gains/loss after obtaining the relevant collector or circle rate. | Click Here | Income-tax Act, 1961 |
| Section 68 | Basaveswar Co-Op Credit Society Niyamit v. Income-tax Officer | Where a credit cooperative society furnished member details (Aadhaar/PAN) to explain cash deposits during the demonetization period, the issue was remanded to the AO for proper verification, as the Commissioner (Appeals) failed to consider the evidence. | Click Here | Income-tax Act, 1961 |
| Section 68 | Principal Commissioner of Income-tax v. KRBL Infrastructure Ltd. | Assessee received an unsecured loan from a corporate lender via banking channels. Since the identity, creditworthiness, and genuineness were established, and the obligation to prove ‘source of source’ did not apply for the relevant year, the addition under Section 68 was unjustified. | Click Here | Income-tax Act, 1961 |
| Section 68 | Preity G Zinta v. Income-tax Officer, International Taxation | Assessee borrowed money in a series of transactions and repaid the loan of the final funding entity by disposing of a residential flat. Since the transactions resulted in merely transferring liability and the assessee derived no benefit, the addition under Section 68 was deleted. | Click Here | Income-tax Act, 1961 |
| Section 80AC | Basaveswar Co-Op Credit Society Niyamit v. Income-tax Officer | For assessment years up to 2017-18, the deduction under Section 80P was not covered by the proviso to Section 80AC. Therefore, the claim for Section 80P deduction by a credit cooperative society could not be denied solely because the return was filed after the due date. | Click Here | Income-tax Act, 1961 |
| Section 80G | R. Mangaldas Charitable Trust v. Commissioner of Income-tax (Exemptions) | The denial of Section 80G(5) registration to a trust was not sustainable, as the trust sufficiently explained that it intended to provide financial assistance to students in India in Indian Rupees, countering the objection that it intended to apply funds outside India. | Click Here | Income-tax Act, 1961 |
| Section 80G | Our Shoulders Foundation v. Commissioner of Income Tax, (Exemptions) | Where a trust filed a Section 80G(5)(iii) application beyond the prescribed timeline, the application should be treated as filed under clause (iv) of the first proviso to Section 80G(5) and decided on the merits, rather than rejected solely on the ground of delay. | Click Here | Income-tax Act, 1961 |
| Section 80GGC | Rajen Jayantilal Merchant v. Assessment Unit, Juris. AO | Disallowance of deduction under Section 80GGC for a donation to a political party was justified where the party’s bank account was used by an accommodation entry provider, suggesting the donation was layered and cash was returned. | Click Here | Income-tax Act, 1961 |
| Section 92C | SAP India (P.) Ltd. v. Deputy Commissioner of Income-tax | A company engaged in the development and sale of accounting/business management software was held to be functionally dissimilar to the assessee-distributor, and thus was not a valid comparable. | Click Here | Income-tax Act, 1961 |
| Section 92C | SAP India (P.) Ltd. v. Deputy Commissioner of Income-tax | Outstanding receivables from Associated Enterprises (AEs) were held to constitute an independent international transaction requiring separate benchmarking, and could not be netted against AE payables. | Click Here | Income-tax Act, 1961 |
| Section 92C | SAP India (P.) Ltd. v. Deputy Commissioner of Income-tax | For calculating notional interest on delayed receivables from an AE where invoices were in Euro, EURIBOR (a currency-relevant benchmark) should be accepted for computing the ALP, rather than the SBI short-term deposit rate used by the TPO. | Click Here | Income-tax Act, 1961 |
| Section 148 | Jagtamba Timber Mart v. Deputy Commissioner of Income-tax | In the faceless regime (Section 151A), an initiation and issuance of a reopening notice under Section 148 by the Jurisdictional Assessing Officer (JAO) was held to be invalid, and the consequential reassessment order was quashed. | Click Here | Income-tax Act, 1961 |
| Section 245C | Interim Board for Settlement v. Krushang Prakashbhai Soni | SLP dismissed: Settlement applications filed before 31.03.2021 were deemed pending for the Interim Board’s consideration, and the retrospective amendment of Section 245C(5) by the Finance Act, 2021, could not invalidate applications filed between 01.02.2021 and 31.03.2021. | Click Here | Income-tax Act, 1961 |
| Section 275 | Deputy Commissioner of Income-tax, Central v. Ashwani Gupta | Penalty orders under Sections 271D/271E passed by the Addl./Jt. CIT beyond six months from the end of the month of the assessment order (as per Section 275(1)(c)) were held to be barred by limitation. | Click Here | Income-tax Act, 1961 |
| Section 276CC | Amit Kapoor v. Income-tax Office | In a criminal complaint for failure to file returns, permitting the complainant to introduce additional departmental documents (like a Section 148 notice) during pre-charge evidence under Section 91 Cr.P.C. was justified, as the documents were necessary for adjudication and did not alter the complaint’s basis. | Click Here | Income-tax Act, 1961 |
For More :- Read IMPORTANT INCOME TAX CASE LAWS 03.12.2025