INCOME TAX CASE LAW 10.07.2026

Relevant Act	Section	Case Law Title	Brief Summary	Citation
Income-tax Act, 1961	Section 2(14)	Ketan Pravinchandra Kamdar v. Deputy Commissioner of Income-tax	Surrendering an allotment right to a flat constitutes a capital asset; compensation received for its relinquishment is taxable as capital gains, making any resultant long-term capital loss allowable.	$2026$ Click Here
Income-tax Act, 1961	Section 10(38)	Sanjiv Dhireshbhai Shah v. Income-tax Officer	Reopening an assessment beyond four years without new tangible material is a mere change of opinion and is liable to be quashed if the original return disclosed the exempt income.	$2026$ Click Here
Income-tax Act, 1961	Section 28(i)	Alepo Technology (P.) Ltd. v. DCIT	If foreign exchange gains/losses are presented on a net basis in audited financials and taxed accordingly, the AO cannot separately add back individual fluctuation losses.	$2026$ Click Here
Income-tax Act, 1961	Section 28(i)	Rakesh Motilal Sharma v. ACIT	Where a JDA involving stock-in-trade was terminated without development taking place, the matter was remanded to examine the factual aspects and taxability of the security deposit.	$2026$ Click Here
Income-tax Act, 1961	Section 37(1)	Principal Commissioner of Income-tax v. Gujarat Gas Trading Company Ltd.	The Tribunal can allow a business deduction during assessment proceedings without a revised return if all necessary facts are on record and accepted by the AO.	$2026$ Click Here
Income-tax Act, 1961	Section 37(1)	Ammann India (P.) Ltd. v. Assistant Commissioner of Income-tax	Reopening an assessment is unwarranted if it is based solely on the AO’s ignorance of law regarding a scientifically created warranty provision that was consistently allowed in other years.	$2026$ Click Here
Income-tax Act, 1961	Section 68	Alepo Technology (P.) Ltd. v. DCIT	Unearned revenue substantiated as customer advances using agreements and ledgers cannot be added under Section 68 in the absence of adverse material.	$2026$ Click Here
Income-tax Act, 1961	Section 68	MPG Business Information Systems (P.) Ltd. v. Dy. CIT	Additions made under Section 68 for unsecured loans must be restricted only to the amounts actually credited during the relevant financial year, excluding the opening balance.	$2026$ Click Here
Income-tax Act, 1961	Section 68	MPG Business Information Systems (P.) Ltd. v. Dy. CIT	Set-off of a current year business loss against Section 68 income is permissible for years prior to April 1, 2017, as the restriction under Section 115BBE(2) applies prospectively from that date.	$2026$ Click Here
Income-tax Act, 1961	Section 68	MPG Business Information Systems (P.) Ltd. v. Dy. CIT	An unsecured loan addition is justified if cross-verification shows the absence of the corresponding receivable in the lender’s financials and the creditor fails to appear or prove creditworthiness.	$2026$ Click Here
Income-tax Act, 1961	Section 68	Ammann India (P.) Ltd. v. Assistant Commissioner of Income-tax	Reopening notice is liable to be quashed if the forfeiture of security deposits was fully explained with material on record during the original assessment, as it amounts to a change of opinion.	$2026$ Click Here
Income-tax Act, 1961	Section 92C	Alepo Technology (P.) Ltd. v. DCIT	A functionally similar software company that satisfies the TPO’s own filters cannot be denied inclusion in the final set of comparables before the DRP via additional evidence.	$2026$ Click Here
Income-tax Act, 1961	Section 92C	Alepo Technology (P.) Ltd. v. DCIT	A company showing profits in one of the last three years does not qualify as a persistent loss-maker and should be included in the list of comparables under TNMM.	$2026$ Click Here
Income-tax Act, 1961	Section 147	Vasundhara Builders and Developers v. Principal Commissioner of Income-tax	Reassessment initiated solely on survey material after dropping Section 153C proceedings is not a “search case” under the DTVSV Scheme, 2024, enabling the assessee to avail the scheme.	$2026$ Click Here
Income-tax Act, 1961	Section 149	Touch Comm Tech (P.) Ltd. v. National e-Assessment Centre, Delhi	Reopening is barred by limitation if proper reckoning of ledger debits and credits brings the net alleged escaped income from search material below Rs. 50 lakhs.	$2026$ Click Here
Income-tax Act, 1961	Section 153C	Manish Dhariwal v. DCIT	A satisfaction note is invalid if the AO of the non-searched person merely reproduces the searched person’s AO’s letter without independently examining the seized documents.	$2026$ Click Here
Income-tax Act, 1961	Section 153C	Manish Dhariwal v. DCIT	If seized material is forwarded to the assessee’s AO after April 1, 2021, the sunset clause extinguishes Section 153C provisions, rendering any post-date assessment void ab initio.	$2026$ Click Here
Income-tax Act, 1961	Section 170A	Technoforce Solutions (I.) (P.) Ltd. v. Deputy Commissioner of Income-tax	Post NCLT-approved amalgamation, the AO can only modify previously completed assessments under Section 170A(2)(a); they lack jurisdiction to initiate fresh assessments under Section 143/142.	$2026$ Click Here
Income-tax Act, 1961	Section 194C	Deputy Commissioner of Income-tax v. Head Digital Works (P.) Ltd.	Google AdWords advertising via an automated, self-service platform does not constitute technical/consultancy services; TDS is rightly deductible at 2% under Section 194C, not 194J.	$2026$ Click Here
Income-tax Act, 1961	Section 220	P. S. Srijan Height Developers v. Assistant Commissioner of Income-tax	Filing an appeal doesn’t automatically stop a “deemed in default” status, but the AO must consider revenue stay guidelines and may exercise discretionary power for a stay when adjusting refunds.	$2026$ Click Here
Income-tax Act, 1961	Section 244A	P. S. Srijan Height Developers v. Assistant Commissioner of Income-tax	Excess refund amounts adjusted in violation of the 20% demand ceiling must be refunded, but interest under Section 244A is denied if the assessee delayed approaching the High Court by 2 years.	$2026$ Click Here
Income-tax Act, 1961	Section 245	P. S. Srijan Height Developers v. Assistant Commissioner of Income-tax	Adjusting subsequent years’ refunds in excess of 20% of a disputed demand without mandatory prior statutory intimation violates the law; excess amounts must be refunded.	$2026$ Click Here
Income-tax Act, 2025	Section 515	V. Ganesamoorthi v. Income-tax Officer	Returning an application for registration as an Income Tax Practitioner is valid if the applicant fails to meet the valid, supplementary rule requirement of one year of active practice.	$2026$ Click Here