Important Income tax case laws 15.12.2025
| Relevant Act | Section | Case Law Title | Brief Summary | Citation |
| Income-tax Act, 1961 | Section 2(14) (Capital Asset) | Manjit Kaur Kamboj v. Income-tax officer | Assessment of land as a capital asset and consequent capital gain addition was justified as the assessee failed to prove the land was not within the 7 km radius of Municipal limits by furnishing a certificate from a competent authority. | Click Here |
| Income-tax Act, 1961 | Section 35AC (Specified Business Expenditure) | Deputy Commissioner of Income-tax v. Lupin Ltd. | SLP dismissed against High Court order holding that reopening was unjustified where the AO merely re-examined the same material considered in the original 143(3) assessment concerning 35AC and 80G expenditure, as no fresh tangible material came to the AO’s knowledge. | Click Here |
| Income-tax Act, 1961 | Section 37(1) (Business Expenditure) | Joint Commissioner of Income-tax (OSD) v. Avon Meters (P.) Ltd. | Disallowance of purchases/expenses under 37(1) was not justified as the Commissioner (Appeals) found that the assessee had filed confirmations, clarified PAN discrepancies, and the remand report accepted these explanations, which addressed the AO’s initial objections. | Click Here |
| Income-tax Act, 1961 | Section 37(1) (Business Expenditure) | Assistant Commissioner of Income-tax v. Lurgi Indianlnternational Services (P.) Ltd. | Foreign exchange fluctuation loss claimed by an engineering consultant following the mercantile system of accounting was allowable as business expenditure as it was accounted for as per Accounting Standard 11 (AS 11). | Click Here |
| Income-tax Act, 1961 | Section 41 (Profits Chargeable to Tax) | Joint Commissioner of Income-tax (OSD) v. Avon Meters (P.) Ltd. | Treating the entire sum of old trade creditors as income under 41(1) (cessation of liability) was unjustified and the addition was deleted, as evidence showed it was a long-standing practice with repayments still occurring in many cases. | Click Here |
| Income-tax Act, 1961 | Section 45 (Capital Gains) | Tarun Nandkumar Seksaria v. Deputy Commissioner of Income-tax | Capital gains assessed solely on an uncorroborated loose sheet found during a search, without examining concerned parties or addressing contradictions/rebuttals, was held to be devoid of evidentiary value and unsustainable. | Click Here |
| Income-tax Act, 1961 | Section 68 / 69C (Cash Credit/Unexplained Expenditure) | Joint Commissioner of Income-tax (OSD) v. Avon Meters (P.) Ltd. | Deletion of addition under 68 (unsecured loans) and related disallowance of interest under 69C was justified as the assessee established the identity, creditworthiness, and genuineness of the lenders, and the AO’s objections were baseless. | Click Here |
| Income-tax Act, 1961 | Section 68 (Cash Credit) | Joint Commissioner of Income-tax (OSD) v. Avon Meters (P.) Ltd. | Cash deposited in specified bank notes during demonetization was not treated as unexplained cash credit under 68 because the amount was traceable to a prior cash withdrawal made for salary payments, with no evidence of intermediate use. | Click Here |
| Income-tax Act, 1961 | Section 68 / 147 (Cash Credit/Reopening) | Aroma Chemicals v. ACIT | Reopening for alleged accommodation-entry profits was invalid as the recorded reasons were based on general statements and mere reproduction of a DIT (I&CI) report without assessee-specific material or independent analysis, amounting to ‘borrowed satisfaction’. | Click Here |
| Income-tax Act, 1961 | Section 68 (Cash Credit) | Income-tax Officer v. Indic Wisdom (P.) Ltd. | Addition under 68 on account of share premium was deleted as the assessee furnished all relevant documents to establish the identity, creditworthiness, and genuineness of the share subscribers and the transaction. | Click Here |
| Income-tax Act, 1961 | Section 68 / 147 (Cash Credit/Reopening) | Assistant Commissioner of Income-tax v. Experion Developers (P.) Ltd. | SLP dismissed against the High Court order. Reassessment proceedings against the share application money received from a Singapore company (GS) were quashed because the identity and genuineness of GS had been examined and accepted by the Department in subsequent assessment years without adverse remarks. | Click Here |
| Income-tax Act, 1961 | Section 69A / 115BBE (Unexplained Moneys) | Chetanbhai Chhaganbhai Sojitra v. Income-tax Officer | Where a small trader’s cash deposits represented trading receipts directly deposited by purchasers, treating the entire deposit as unexplained money under 69A was erroneous. Only the profit element (estimated at of receipts) was liable to tax at normal rates and not under 115BBE. | Click Here |
| Income-tax Act, 1961 | Section 69A / 148 (Unexplained Moneys/Reassessment) | Tarun Nandkumar Seksaria v. Deputy Commissioner of Income-tax | Additions made under 69A based on seized excel sheets and statements of two persons were deleted as there were no corroborative documents and both persons had retracted their statements with cogent reasons. | Click Here |
| Income-tax Act, 1961 | Section 69A / 151A (Unexplained Moneys/Faceless) | Veda Real Estate Corporation (P.) Ltd. v. Deputy Commissioner of Income-tax | Reassessment proceedings initiated by the jurisdictional AO in violation of the Faceless Scheme (151A) were quashed for lack of jurisdiction. The assessment order also lacked a Document Identification Number (DIN). | Click Here |
| Income-tax Act, 1961 | Section 69A (Unexplained Moneys) | Veda Real Estate Corporation (P.) Ltd. v. Deputy Commissioner of Income-tax | Additions for alleged cash investment in land based on seized excel sheets and retracted statements were deleted. Mere discovery of an uncorroborated excel sheet, not prepared by the assessee’s directors, cannot be the sole basis for an addition. | Click Here |
| Income-tax Act, 1961 | Section 69C (Unexplained Expenditure) | News Builders and Developers (P.) Ltd. v. Income-tax Officer | Addition under 69C based on an undated and unsigned draft agreement to sell (found in a third-party search) alleging 1.01 crore cash payment was deleted, as the assessee provided complete details of all payments made to the vendors via cheques. | Click Here |
| Income-tax Act, 1961 | Section 70 (Set Off of Losses) | Ira Sharma v. Deputy Commissioner of Income-tax, CPC | The assessee’s claim to set off brought forward long-term capital loss and current year’s short-term capital losses against current year’s Long-Term Capital Gain (LTCG) was in accordance with 70. There was no loss to the revenue as the income taxable at the higher rate was adjusted against income taxable at the lower rate. | Click Here |
| Income-tax Act, 1961 | Section 79 (Carry Forward of Losses) | Assistant Commissioner of Income-tax v. Lurgi Indianlnternational Services (P.) Ltd. | Disallowance of carry forward of losses under 79 due to a change in shareholding was rightly allowed by CIT(A) because, post-amalgamation, the ultimate beneficial ownership of the assessee-company remained consistent. | Click Here |
| Income-tax Act, 1961 | Section 80G (Deduction – Donations) | Amway India Enterprises (P.) Ltd. v. Deputy Commissioner of Income-tax | Deduction under 80G for donation was allowed. Following the principle of consistency and prior Tribunal orders, Explanation 2 to 37 (restricting CSR expenditure) does not bar the deduction under 80G. | Click Here |
| Income-tax Act, 1961 | Section 92C (Transfer Pricing – AMP) | Amway India Enterprises (P.) Ltd. v. Deputy Commissioner of Income-tax | AMP (Advertisement, Marketing, and Promotion) adjustment was deleted following the principle of consistency with the immediately preceding assessment year’s Tribunal order, which held that commission paid to distributors was not part of AMP expenditure and AMP spend was not an international transaction. | Click Here |
| Income-tax Act, 1961 | Section 151A (Faceless Assessment) | Tarun Nandkumar Seksaria v. Deputy Commissioner of Income-tax | Reassessment proceedings initiated under 148 by the jurisdictional Assessing Officer in violation of the Faceless Assessment Scheme (151A) were quashed for lack of jurisdiction. | Click Here |
| Income-tax Act, 1961 | Section 264 (Revision of Orders) | Shangri-La International Hotel Management Pte. Ltd. v. Commissioner of Income-tax (International Tax) | The Commissioner wrongly refused 264 revision relief because a binding jurisdictional High Court decision (in favor of the assessee) was pending before the Supreme Court. Since the High Court precedent was still applicable, the revision application was allowed in line with that judgment. | Click Here |
For More :- Read Important Income Tax Case Law 12.12.2025