IMPORTANT INCOME TAX CASE LAWS 21.11.2025

Section of Act	Case Law Title	Brief Summary	Citation	Relevant Act
Section 11	Lakhi Trust v. Income-tax Officer Exemption Ward – 1 (4)	Delay in filing mandatory Form No. 9A for claiming deemed application of income by a charitable trust was condonable under genuine hardship, as it was subsequently filed during assessment with a condonation application.	Click Here	Income-tax Act, 1961
Section 28(i)	Mukesh Gupta v. Deputy Commissioner of Income-tax	Receipt claimed as professional/technical service fee by a company director was liable to be treated as salary income because the director failed to produce documentation to evidence professional or technical services rendered as a financial expert.	Click Here	Income-tax Act, 1961
Section 37(1)	Mukesh Gupta v. Deputy Commissioner of Income-tax	Claim for deduction of interest expenditure on amounts borrowed and advanced to a company was not allowable as the assessee failed to substantiate a business nexus (commercial expediency) between borrowing and advancing the funds.	Click Here	Income-tax Act, 1961
Section 37(1)	Sri Tirumala Estates v. Income-tax Officer	Ad hoc disallowance of 10 per cent of commission expenses for a real estate firm was unsustainable when complete particulars (PANs, TDS details, bank statements) were furnished, and the books of account were not rejected.	Click Here	Income-tax Act, 1961
Section 37(1)	Sri Tirumala Estates v. Income-tax Officer	Ad hoc disallowance of 10 per cent of land development expenses was not upheld when major portion of the expenditure involved verifiable payments to regulatory authorities and the books were not rejected.	Click Here	Income-tax Act, 1961
Section 48	Income-tax Officer v. Surendra Nath Gubbala	Payments made by the purchaser to clear a mortgage (SARFAESI liability) and settle a rival ownership claim were deductible as expenditure incurred wholly and exclusively in connection with the transfer for computing capital gains.	Click Here	Income-tax Act, 1961
Section 54F	Krunal Sanghvi v. Income Tax Officer	Penalty for misreporting income under section 270A(9) was not sustainable when the assessee disclosed all facts regarding capital gains and investment but only erred in calculating the deduction under section 54F.	Click Here	Income-tax Act, 1961
Section 68	Jatinder Gupta v. Deputy Commissioner of Income-tax	Addition for alleged bogus purchases based solely on the supplier’s statement, without providing cross-examination or other incriminating material, was unsustainable due to violation of natural justice.	Click Here	Income-tax Act, 1961
Section 68	Matrix Automotive v. Income-tax Officer-	Matter was restored for fresh adjudication to allow additional evidence regarding unsecured loans (cash credit), as sufficient cause existed for the inability to produce evidence earlier (accountant and AR discontinued services).	Click Here	Income-tax Act, 1961
Section 119	Ashwini Kumar v. Central Board of Direct Taxes	CBDT was directed to issue a circular extending the return filing due date to 30.11.2025 for auditable assessees for AY 2025-26, due to an undecided extension proposal and delay in e-filing utilities.	Click Here	Income-tax Act, 1961
Section 148, 148A	Panchsheel Mercantile Co-Op Bank Ltd. v. Assistant Commissioner of Income-tax	Reassessment notice issued on an old PAN that the assessee had already surrendered was quashed and set aside.	Click Here	Income-tax Act, 1961
Section 151	Income-tax Officer v. Prakash Pandurang Patil	SC restored SLP, holding that when reassessment was initiated after three years, sanction for the notice under section 148 must be granted by the higher-ranking authorities specified in section 151(ii), not section 151(i).	Click Here	Income-tax Act, 1961
Section 151A	Income-tax Officer v. Prakash Pandurang Patil	SC restored SLP, holding that a reopening notice under section 148 for AY 2018-19 was invalid because it was not under the mandatory faceless mechanism as per section 151A.	Click Here	Income-tax Act, 1961
Section 194A	VELLANGALLUR PEOPLES WELFARE CO-OPERATIVE SOCIETY LTD. v. UNION OF INDIA	Challenging the constitutional validity of the proviso to section 194A(3) (inserted by Finance Act, 2020) was rejected, as income-based thresholds are a legitimate basis for tax classification, and section 80P relief is a deduction, not an exemption.	Click Here	Income-tax Act, 1961
Section 194J	Income-tax Officer (TDS) v. Muthoot Health Care (P.) Ltd.	Payments to doctors who were free to carry on private practice, not subject to stringent work restrictions, and not entitled to PF/terminal benefits, were properly treated as professional fees (TDS under section 194J) and not salary (TDS under section 192).	Click Here	Income-tax Act, 1961

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