INCOME TAX CASE LAW 01.06.2026
INCOME TAX CASE LAW 01.06.2026
Income Tax Case Law Summary
| Section | Case Law Title | Brief Summary | Citation | Relevant Act |
| Section 10(23C)(iiiab) | Hidayatullah National Law University v. ACIT | Exemption denied as Government grants received during the year were only 47.85% (less than the 50% threshold mandated under Rule 2BBB), failing the requirement of being “wholly or substantially financed by Government.” | Income-tax Act, 1961 | |
| Section 14A | Parle Biscuits (P.) Ltd. v. DCIT | Where an assessee had already disallowed direct expenses under Section 37 and offered a reasonable disallowance under Section 14A based on precedent, adding them again under Section 14A constitutes an impermissible double disallowance. | Income-tax Act, 1961 | |
| Section 37(1) | CIT v. National Agricultural Co-Op. Marketing Federation of India Ltd. |
1. Interest provision deduction for an arbitral award is not allowable once the Supreme Court sets aside the basic award.
2. Expenses for gifts, boarding, and lodging for a General Body Meeting are allowable as business expenditure, which must be construed broadly. |
Income-tax Act, 1961 | |
| Section 68 | ITO v. Aashna Developers (P.) Ltd. | Matter remanded for fresh adjudication because the AO failed to independently verify the repayment of an unsecured loan through banking channels and payment of interest after TDS, despite the assessee furnishing all primary documents. | Income-tax Act, 1961 | |
| Section 69A | Montage Enterprises (P.) Ltd. v. DCIT/ACIT | Cash addition deleted where cash found during a search matched contemporaneous bank entries. Since undisclosed profit was already estimated on turnover, telescoping was rightly allowed. | Income-tax Act, 1961 | |
| Section 69A | Pradeep Tyagi HUF v. ITO | A cash deposit addition of Rs. 1 crore is unsustainable and liable to be deleted if the Assessing Officer fails to specify the exact charging section for making the addition. | Income-tax Act, 1961 | |
| Section 69C | Montage Enterprises (P.) Ltd. v. DCIT/ACIT | Separate addition for alleged RTGS commission cannot be sustained when higher authorities have already treated the underlying RTGS amounts as recorded sales made through traders. | Click Here | Income-tax Act, 1961 |
| Section 143 | Parle Biscuits (P.) Ltd. v. DCIT | If a tax audit report quantifies a disallowance that the assessee fails to add back in the ITR, the CPC has the prima facie jurisdiction to propose an adjustment under Section 143(1)(a)(iv). | Click Here | Income-tax Act, 1961 |
| Section 145 | Montage Enterprises (P.) Ltd. v. DCIT/ACIT | Upon rejection of books post-search, the Gross Profit (GP) rate should be based on an industrial average of relevant comparable companies (4.315% applied here) rather than non-comparable direct importers. | Click Here | Income-tax Act, 1961 |
| Section 149 | Sunil Bhalla v. DCIT | The time period between the issuance of a Section 148A(b) notice and a deferred/deemed reply date must be excluded when calculating the limitation period for issuing a reassessment notice. | Income-tax Act, 1961 | |
| Section 194LA | Karnataka Neeravari Nigama Ltd. v. Shakuntalabai | Land acquisition compensation disbursed via a court-referred mediation agreement (under Section 89 CPC / Order XXIII Rule 3 CPC) must be released without deducting TDS. | Income-tax Act, 1961 | |
| Section 201 | State Bank of India Currency Administration Cell v. ITO | A bank cannot be treated as an “assessee in default” for not deducting TDS on the foreign leg of LTC/LFC journeys when it acted under binding, clear interim directions from the High Court during that period. | Income-tax Act, 1961 | |
| Section 254 | Bharti Airtel Ltd. v. ITO (TDS) | Recall applications under Rule 24 rejected where the assessee sought to recall ex-parte orders after 14 years without providing an explanation for non-appearance, satisfying the presumption of due service. | Income-tax Act, 1961 | |
| Section 254 | PCIT v. Vishwanath Singhal | Revenue’s appeal regarding an organized tax evasion scheme using brokers falls under the exception clause ‘h’ of CBDT Circular No. 5/2024, meaning it must be adjudicated on its merits by the ITAT despite low tax effects. | Income-tax Act, 1961 |