INCOME TAX CASE LAWS 06.10.2026

Relevant Act	Section	Case Law Title	Citation	Brief Summary
Income-tax Act, 1961	Section 9	Maruti Suzuki India Ltd. v. Deputy Commissioner of Income-tax	Click Here	No disallowance under Section 40(a)(i) read with Section 195 on purchases from parent company where facts were identical to earlier years where Tribunal held no disallowance was attracted.
Income-tax Act, 1961	Section 12AB	Suraj Devi Charitable Trust v. Commissioner of Income-tax (Exemptions)	Click Here	Absence of explicit irrevocable/dissolution clauses in a trust deed is not a valid ground for rejection of Section 12AB registration, as public charitable trusts are deemed irrevocable by law.
Income-tax Act, 1961	Section 14A	Maruti Suzuki India Ltd. v. Deputy Commissioner of Income-tax	Click Here	Disallowance under Section 14A read with Rule 8D(2)(iii) without recording satisfaction as required by Rule 8D(1) and without identifying specific relatable expenses is unjustified.
Income-tax Act, 1961	Section 14A	Vodafone Mobile Services Ltd. v. DCIT	Click Here	In the absence of any exempt income earned during the relevant year, no disallowance under Section 14A read with Rule 8D can be made.
Income-tax Act, 1961	Section 14A	Principal Commissioner of Income-tax v. Tata Realty & Infrastructure Ltd.	Click Here	Section 14A disallowance cannot be made where no exempt income was earned, and CBDT circulars cannot override settled judicial precedents on this principle.
Income-tax Act, 1961	Section 28(i)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Interest earned on fixed/margin money deposits maintained out of business funds for credit facilities/guarantees has a direct nexus with business and is taxable under “Profits and gains of business or profession”.
Income-tax Act, 1961	Section 32	Vodafone Mobile Services Ltd. v. DCIT	Click Here	AO cannot impute notional sale value to further reduce block of assets when passive infrastructure was transferred without consideration under a Court-approved demerger scheme and WDV was voluntarily reduced.
Income-tax Act, 1961	Section 35ABB	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Following CIT v. Bharti Hexacom Ltd., annual telecom licence fees paid under NTP 1999 are governed by Section 35ABB amortisation rather than Section 37(1) revenue deduction.
Income-tax Act, 1961	Section 36(1)(iii)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Interest on capital borrowed for network/fixed assets under CWIP for existing business operations (not extension of business) is allowable under Section 36(1)(iii).
Income-tax Act, 1961	Section 36(1)(iii)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Disallowance of notional interest on loan to group company restored to AO for limited verification that interest was charged at stated rates and offered to tax.
Income-tax Act, 1961	Section 37(1)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Claim of site rental charges paid to passive infrastructure provider restored to AO for verification of certificate, site list, and agreement to allow crystallised expenditure.
Income-tax Act, 1961	Section 37(1)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Penalties/charges paid to DoT for licence non-compliance were compensatory/contractual in nature, hence not barred by Explanation 1 to Section 37(1) and fully allowable.
Income-tax Act, 1961	Section 37(1)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Ad-hoc 10% disallowance of distributor commission is unsustainable when major distributor particulars and TDS certificates were submitted without specific defects.
Income-tax Act, 1961	Section 37(1)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Periodical WPC/spectrum usage charges paid as a percentage of revenue for existing business operations are allowable as revenue expenditure under Section 37(1).
Income-tax Act, 1961	Section 37(1)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Depreciation on capitalised Asset Restoration Cost (AS-29) disallowed per High Court ruling, but alternate claim as revenue expenditure under Section 37(1) allowed after quantum verification.
Income-tax Act, 1961	Section 37(1)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Advertisement expenditure incurred for promoting existing products/schemes is revenue expenditure; incidental long-term benefit does not convert it into capital expenditure.
Income-tax Act, 1961	Section 37(1)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Losses arising from subscriber/customer fraud and non-recovery of billed amounts in the ordinary course of telecom business are allowable business deductions.
Income-tax Act, 1961	Section 37(1)	Principal Commissioner of Income-tax v. Tata Realty & Infrastructure Ltd.	Click Here	Compensation paid to an outgoing tenant to vacate premises prior to entering a leave-and-license agreement is revenue expenditure, not capital in nature.
Income-tax Act, 1961	Section 41(1)	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Unilateral write-back of unclaimed customer security deposits does not attract Section 41(1), as deposits were capital receipts at inception with no prior deduction claimed.
Income-tax Act, 1961	Section 45	Maruti Suzuki India Ltd. v. Deputy Commissioner of Income-tax	Click Here	Gains from share/security transactions treated as capital gains since transactions were pure investments and could not be reclassified as business income by AO.
Income-tax Act, 1961	Section 56	Deepika Dilip Nadkar v. Income-tax Officer	Click Here	AO cannot reject DVO’s valuation (which was lower than stamp value) to adopt stamp value; matter remanded for de novo DVO valuation considering objections and evidence.
Income-tax Act, 1961	Section 68	Rekha Khandelwal v. Income-tax Officer	Click Here	Where ex-parte reassessment addition was made for cash deposits in a bank account alleged to be fraudulently operated by bank staff, matter remanded to AO for fresh hearing.
Income-tax Act, 1961	Section 68	Zoom Insurance Brokers Pvt. Ltd. v. Assistant Commissioner of Income-tax	Click Here	Interference with Section 148A order/notice was unwarranted where High Court previously held in assessee’s case that genuineness of insurance MLBE routing requires factual AO examination.
Income-tax Act, 1961	Section 69A	Principal Commissioner of Income-tax v. Kanaiya Readymade Stores	Click Here	PCIT cannot invoke Section 263 revision on demonetization cash deposits where AO had already thoroughly examined and considered the issue during original assessment.
Income-tax Act, 1961	Section 69C	Nahar Industrial Enterprises Ltd. v. ACIT	Click Here	Addition for bogus purchases cannot be sustained solely on third-party statements without corroborative evidence or cross-examination, where stock records and sales were undisputed.
Income-tax Act, 1961	Section 80G	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Disallowance of Section 80G deduction without a speaking finding restored to AO for limited verification of donation receipts and statutory approval of donee.
Income-tax Act, 1961	Section 80-IA	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Receipts with integral nexus to telecom business (liabilities write-back, forex gain, site sharing) are eligible for Section 80-IA, but SFIS/export incentives are excluded.
Income-tax Act, 1961	Section 80-IA	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Initial assessment year for Section 80-IA deduction must be determined with reference to the year in which deduction is actually admissible and allowed after set-off of losses.
Income-tax Act, 1961	Section 92C	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Determination of brand royalty ALP at nil by TPO without applying any prescribed method and by questioning commercial expediency is unsustainable and deleted.
Income-tax Act, 1961	Section 92C	Vodafone Mobile Services Ltd. v. DCIT	Click Here	TP adjustment applying bright-line test to AMP expenses deleted in absence of agreement/arrangement proving international transaction for AE reimbursement.
Income-tax Act, 1961	Section 151	Nahar Industrial Enterprises Ltd. v. ACIT	Click Here	Reopening sanction granted mechanically by merely recording “fit case” without independent application of mind by approving authority invalidates reassessment.
Income-tax Act, 1961	Section 153	Deepika Dilip Nadkar v. Income-tax Officer	Click Here	Period taken for DVO report transmission is excluded under Explanation 1(iv) to Section 153, extending remaining limitation period to 60 days and validating assessment order.
Income-tax Act, 1961	Section 194C / Section 194J	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Automated roaming services involving no human intervention do not attract TDS under Section 194C or 194J; Section 40(a)(ia) disallowance deleted.
Income-tax Act, 1961	Section 194H	Vodafone Mobile Services Ltd. v. DCIT	Click Here	Discounts offered on sale of prepaid products to distributors do not constitute “commission” under Section 194H; Section 40(a)(ia) disallowance deleted.
Income-tax Act, 1961	Section 199	Avni Dogra v. Assistant Commissioner of Income -tax	Click Here	Employee cannot be denied credit for TDS deducted by employer from salary even if employer fails to deposit it with the Revenue.
Income-tax Act, 1961	Section 220 / Section 245	Intugine Technologies (P.) Ltd. v. Income-tax Officer	Click Here	Adjustment of refund against disputed demand under Section 245 is valid where no stay was filed; refund of demand adjusted in excess of 20% cannot be claimed automatically.
Income-tax Act, 1961	Section 244A	Maharashtra Border Check Post Network Ltd. v. CBDT	Click Here	Assessee is entitled to Section 244A(1)(b) interest on refund of TDS deposit made after High Court quashes order treating assessee as in default; Section 244A(1B) cannot bar interest.
Income-tax Act, 1961	Section 249 / Section 249(4)(b)	Rekha Khandelwal v. Income-tax Officer	Click Here	Dismissal of appeal under Section 249(4)(b) for non-payment of advance tax is incorrect when the returned income of the assessee was Nil.
Income-tax Act, 1961	Section 276D	Flamingo Breweries (P.) Ltd. v. Income-tax Deptt	Click Here	Once Tribunal sets aside findings of concealment and related penalties, prosecution proceedings for concealment based on initial assessment become illegal and without jurisdiction.
Income-tax Act, 1961	Section 278B	Flamingo Breweries (P.) Ltd. v. Income-tax Deptt	Click Here	Joint complaint against company and directors is maintainable, but separate prosecution complaints filed individually against directors without joining company are non-maintainable.
Income-tax Act, 1961	Section 278E	Flamingo Breweries (P.) Ltd. v. Income-tax Deptt	Click Here	Statutory presumption of culpable mental state under Section 278E applies only during trial and cannot be relied upon at the complaint-filing stage to establish maintainability.