INCOME TAX CASE LAWS 15.10.2026

Notifications & Case Laws Summary

Relevant Act	Section	Case Law Title / Source	Citation	Brief Summary
Income-tax Act, 2025	Section 159(1)	CBDT Notification F. No. 135/2026	Click here	CBDT notified the Protocol amending the India-Mauritius DTAA (signed March 07, 2024), introducing a new Article 27B (Principal Purpose Test) to deny treaty benefits where obtaining them was one of the principal purposes of a transaction.
Income-tax Act, 1961	Section 5	Citi Bank N.A. v. Additional Director of Income Tax (IT)	Click here	Mere year-end valuation surplus on unmatured forward contracts credited on an estimated basis without actual settlement does not constitute real income chargeable to tax.
Income-tax Act, 1961	Section 9	Citi Bank N.A. v. Additional Director of Income Tax (IT)	Click here	Interest paid by an Indian branch to its HO or overseas branches is a payment to self; no tax deduction under Section 195 is required, and disallowance under Section 40(a)(i) is unsustainable.
Income-tax Act, 1961	Section 14A	Citi Bank N.A. v. Additional Director of Income Tax (IT)	Click here	Disallowance of interest under Section 14A is not warranted where sufficient interest-free funds exist and no direct nexus is established between interest-bearing borrowings and tax-exempt investments.
Prohibition of Benami Property Transactions Act, 1988	Section 27	State Bank of India v. Initiating Officer	Click here	Where property declared benami was mortgaged to a bank, the bank was directed to recover dues first from other secured properties, with liberty to file a claim under Section 27(2) if dues remain unrecovered.
Income-tax Act, 1961	Section 28(i)	Commissioner of Income-tax v. Goden Eagle Communications Ltd.	Click here	Addition deleting ₹2 crores non-compete fee linked to slump sale from being taxed in full as business income/capital gains was upheld following prior High Court precedent.
Income-tax Act, 1961	Section 148 / 148A	Assistant Commissioner of Income-tax v. Dignesh Pramukhlal Patel	Click here	SLP Dismissed: Reassessment proceedings initiated to recharacterize Section 54F capital gains as business income solely due to a change in control/directorship constituted a mere change of opinion and were impermissible.
Income-tax Act, 1961	Section 32	Gluhend India (P.) Ltd. v. DCIT	Click here	Set-off of unabsorbed depreciation governed by Section 32(2) cannot be denied merely because the return for the subsequent year was filed belatedly under Section 139(4).
Income-tax Act, 1961	Section 35DDA	Citi Bank N.A. v. Additional Director of Income Tax (IT)	Click here	Recurring pension/Mediclaim payments under VRS cannot be mechanically amortised under Section 35DDA; deduction is allowable to the extent corresponding provisions were disallowed in earlier years.
Income-tax Act, 1961	Section 36(1)(vii)	Citi Bank N.A. v. Additional Director of Income Tax (IT)	Click here	Adjustment of bad debts written off against provision for bad and doubtful debts must be made with reference to the opening credit balance of the provision, not the closing balance.
Income-tax Act, 1961	Section 37(1)	Citi Bank N.A. v. Additional Director of Income Tax (IT)	Click here	Broken period interest paid on securities held as stock-in-trade by a non-resident banking company is allowable as a revenue expenditure in computing business income.
Income-tax Act, 1961	Section 44C	Citi Bank N.A. v. Additional Director of Income Tax (IT)	Click here	Expenses incurred on overseas training of Indian branch employees do not pertain to employees managing overseas offices and cannot be restricted as head office expenditure under Section 44C.
Income-tax Act, 1961	Section 56	Income-tax Officer v. Goral Infrastructure (P.) Ltd.	Click here	SLP Dismissed: Section 56(2)(x) is not applicable to land acquired in the normal course of real estate business and held as stock-in-trade; reassessment without new tangible material is unsustainable.
Income-tax Act, 1961	Section 68	Raj Kumar Gupta v. Union of India	Click here	Filing a defective appeal with an unexplained delay of 2,628 days despite full knowledge of proceedings justified in limine dismissal due to lack of sufficient cause and mala fide conduct.
Income-tax Act, 1961	Section 69A	Nirmal Puri v. Assistant Commissioner of Income-tax, Central	Click here	No substantial question of law arose regarding the addition made for unexplained gold bars weighing 426 grams recovered from the assessee’s locker.
Income-tax Act, 1961	Section 74	Gluhend India (P.) Ltd. v. DCIT	Click here	A long-term capital loss eligible for carry-forward (filed on time under Section 139(1) in the origin year) is not extinguished merely by filing a belated return under Section 139(4) in a subsequent year.
Income-tax Act, 1961	Section 80G	Viterra India (P.) Ltd. v. Principal Commissioner of Income-tax	Click here	Deduction under Section 80G for donations (including PM CARES) is evaluated independently; expenditure disallowed under Section 37(1) (such as CSR) does not automatically become ineligible under Section 80G.
Income-tax Act, 1961	Section 80GGC	Pragnesh Bhogilal Shah v. Income-tax Officer	Click here	Deduction for political party donation is disallowable where investigations prove the recipient party merely provided accommodation entries via fund layering, despite payment made via banking channels.
Income-tax Act, 1961	Section 92	Citi Bank N.A. v. Additional Director of Income Tax (IT)	Click here	Transfer pricing provisions apply to inter-branch transactions between the Indian permanent establishment (branch) of a foreign bank and its Head Office or overseas entities.
Income-tax Act, 1961	Section 92C	Citi Bank N.A. v. Additional Director of Income Tax (IT)	Click here	Transfer pricing adjustments deleted across multiple grounds, including setting off interest excess/shortfalls under CUP, benchmarking Data Centre support services, acceptance of portfolio-based VC advisory fees, integrated correspondent banking activities, incidental employee oversight, and misapplication of Profit Split Method.
Income-tax Act, 1961	Section 92C	Gluhend India (P.) Ltd. v. DCIT	Click here	1. Matter restored to TPO to verify reliable segmental data before rejecting CPM/internal TNMM. 2. Corporate guarantee commission benchmarked at 0.50% instead of bank guarantee rate of 1%; notional guarantee income cannot set off notional guarantee expenses.
Income-tax Act, 1961	Section 92CA	Himatsingka Seide Ltd. v. Principal Commissioner of Income-tax Central	Click here	SLP Dismissed: Whether abatement under Section 153A renders a prior TPO determination non-est and requires a fresh reference under Section 92CA is a substantial question of law.
Income-tax Act, 1961	Section 139	Uber Health Tech (P.) Ltd. v. Assistant Commissioner of Income-tax	Click here	When defects in a return treated as defective under Section 139(9) are cured within time, the return relates back to the original filing date under Section 139(1); subsequent Section 143(2) notice was time-barred.
Income-tax Act, 1961	Section 147A / 151A	Bala Sreenivas Rao Somisetty v. Income-tax Officer	Click here	Retrospective insertion of Section 147A violating the separation of powers was held unconstitutional; reassessment notices issued by JAOs instead of following Section 151A faceless schemes were quashed for lack of jurisdiction.
Income-tax Act, 1961	Section 153D	Pr. Commissioner of Income-tax v. Citron Infraprojects Ltd.	Click here	SLP Dismissed: Mass approval granted under Section 153D without independent application of mind (issued en masse within 24 hours using identical wording) invalidated the Section 153A assessment orders.
Income-tax Act, 1961	Section 245C	Vishnu Kumar Gupta v. Deputy Commissioner of Income-tax, Central	Click here	Eligibility for settlement applications filed on or before 30.09.2021 depends on having a live, unadjudicated notice under Section 153A/143(2) on the date of application; rejection without merits was unjustified.
Income-tax Act, 1961	Section 260A	Himatsingka Seide Ltd. v. Principal Commissioner of Income-tax Central	Click here	SLP Dismissed: A 341-day delay in filing an appeal by the Revenue was condoned due to administrative complexities arising from inter-State movement of search records and approvals.
Income-tax Act, 1961	Section 263	Naresh Kumar v. Principal Commissioner of Income-tax	Click here	Section 263 revision is impermissible where the AO adopts one plausible view—treating Section 28 Land Acquisition Act interest on compulsory agricultural land acquisition as exempt under Section 10(37).
Income-tax Act, 1961	Section 263	Sanjay Goyal v. DCIT	Click here	Where reopening was based on specific seized material, initiating Section 263 revision on an unrelated issue (TDS non-deduction) without any incriminating material was beyond the PCIT’s jurisdiction.