INCOME TAX CASE LAWS 26.07.2026

Relevant Act	Section	Case Law Title	Citation	Brief Summary
Income-tax Act, 1961	Section 4	Burgess English Senior Secondary School v. ITO	Click Here	Applying the principle of consistency, the school’s income/surplus could not be assessed in its hands since the AO had accepted its claim in earlier years that it formed part of CDBE’s accounts, and no new material justified a change in stand.
Direct Tax Vivad se Vishwas Scheme, 2024	Section 4	High Profile Softech (P.) Ltd. v. Income Tax Appellate Tribunal	Click Here	Upon issuing Form No. 4 under VSV, CIT(A)/NFAC should have refrained from adjudicating the appeal and treated it as withdrawn; subsequent orders are quashed as Form No. 4 is conclusive.
Income-tax Act, 1961	Section 5	Jio Platforms Ltd. v. DCIT	Click Here	Assessing Officer was not justified in taxing advance OTT subscription revenue in the current year, as the assessee consistently recognized revenue proportionately over the service period and offered advance revenue to tax upon service delivery.
Income-tax Act, 1961	Section 9	JP Morgan Chase Bank v. ACIT	Click Here	Interest earned by an Indian branch of a US bank on surplus funds placed with its Head Office/overseas branches is not taxable in India, as no real income arises from dealings with oneself under Article 7 of the India-US DTAA.
Income-tax Act, 1961	Section 10(23C)	Uttar Bhartiya Education Society v. PCIT (Exemption)	Click Here	Delay of 1,797 days in filing appeals was condoned and restored for merits adjudication, as the delay due to a CA’s inadvertent error in claiming exemption and non-filing of Form 10B deserved consideration.
Income-tax Act, 1961	Section 10A	PCIT v. Persistent Systems (P.) Ltd.	Click Here	TP additions under Section 10A(7) r.w.s. 80IA(10) were deleted because Section 80IA(10) requires a clear finding that dealings actually yielded abnormal profits, which was not established before benchmarking against comparables.
Income-tax Act, 1961	Section 10AA	Genesys International Corporation Ltd. v. ACIT	Click Here	Reassessment notice issued on grounds of non-set-off of losses and late export realization was quashed, as the claim was examined during original scrutiny, making the reassessment a mere impermissible change of opinion.
Income-tax Act, 1961	Section 28(i)	JP Morgan Chase Bank v. ACIT	Click Here	Diminution in the value of trading portfolio securities held as current investments (valued at lower of cost or market value) is a real business loss allowable under Section 37(1), as securities form stock-in-trade.
Income-tax Act, 1961	Section 32	Jio Platforms Ltd. v. DCIT	Click Here	Depreciation on the opening WDV of intangible assets acquired under a slump sale cannot be denied by alleging a colourable device when it was allowed in earlier years, unless an event reduces WDV under Section 43(6).
Income-tax Act, 1961	Section 36	PCIT, Central-4 v. Maneesh Pharmaceuticals (P.) Ltd.	Click Here	Deduction for writing off outstanding debtors as irrecoverable was upheld as a factual finding satisfying Sections 36(1)(vii) and 36(2), giving rise to no substantial question of law.
Income-tax Act, 1961	Section 36(1)(iii)	Jio Platforms Ltd. v. DCIT	Click Here	Interest paid on borrowings inherited via a slump sale is allowable under Section 36(1)(iii) as liabilities are intrinsically connected to the business; disallowance under Section 40A(2) fails without proof of excessive expenditure.
Income-tax Act, 1961	Section 36(1)(va)	Tata Projects Ltd. v. DCIT	Click Here	No disallowance is warranted under Section 36(1)(va) r.w.s. 2(24)(x) where the assessee proves via bank statements that employees’ PF/ESI contributions were deposited within the due dates under the respective welfare Acts.
Income-tax Act, 1961	Section 36(1)(vii)	Tata Projects Ltd. v. DCIT	Click Here	Bad debt deduction for completed projects was allowed as the amounts were previously offered as receipts and the statutory conditions of Sections 36(1)(vii) and 36(2) were fulfilled.
Income-tax Act, 1961	Section 37	JP Morgan Chase Bank v. ACIT	Click Here	Reimbursement of salary for an expatriate employee initially paid by the Head Office represents direct Indian branch salary cost, not HO overheads, and thus cannot be restricted under Section 44C.
Income-tax Act, 1961	Section 37(1)	JP Morgan Chase Bank v. ACIT	Click Here	Mark-to-market loss on outstanding foreign exchange forward contracts, valued per RBI guidelines, is an ascertained business liability allowable under the mercantile system, not a contingent loss.
Income-tax Act, 1961	Section 37(1)	JP Morgan Chase Bank v. ACIT	Click Here	Hub expenses for centralized banking support allocated by overseas hubs to the Indian branch on a scientific basis are operational expenditures for Indian business, fully allowable under Section 37(1) without Section 44C caps.
Income-tax Act, 1961	Section 37(1)	JP Morgan Chase Bank v. ACIT	Click Here	Broken period interest paid on purchasing interest-bearing securities held for banking business is allowable revenue expenditure; disallowance would improperly lead to taxing notional income.
Income-tax Act, 1961	Section 37(1)	Tata Projects Ltd. v. DCIT	Click Here	Issue of allowability of expenditure incurred during the Defect Liability Period post-completion was remanded to CIT(A) for fresh evaluation after giving due opportunity to examine documentary evidence.
Income-tax Act, 1961	Section 37(1)	Sushil Gupta v. PCIT-17	Click Here	Supreme Court dismissed SLP as withdrawn, confirming that fines or redemption penalties paid for import illegalities/irregularities are non-deductible business expenses.
Income-tax Act, 1961	Section 37(1)	PCIT, Central-4 v. Maneesh Pharmaceuticals (P.) Ltd.	Click Here	Write-off of expired finished goods inventory verified and complying with FDA norms is an allowable business expense based on concurrent factual findings, presenting no substantial question of law.
Income-tax Act, 1961	Section 40(a)(ia)	PCIT v. Jindal Saw Ltd.	Click Here	Where tax was deducted under Section 194C instead of 194I, mere deduction under an alternate relevant section does not make the assessee an assessee-in-default nor attract disallowance under Section 40(a)(ia).
Income-tax Act, 1961	Section 55	CIT v. HCL Infosystems Ltd.	Click Here	SLP dismissed against High Court ruling that amounts received upon termination of a joint venture agreement (involving know-how, trademarks, and patents) were not taxable under Section 55(2) as it then stood.
Income-tax Act, 1961	Section 68	ACIT v. Maulik Jayantilal Patel	Click Here	SLP dismissed; Section 153C proceedings based solely on third-party post-search/public data without finding incriminating material or proving live nexus to the assessee are unsustainable and quashed.
Income-tax Act, 1961	Section 72	Sanden Vikas India (P.) Ltd. v. ACIT, TP	Click Here	Brought forward business losses allowed in draft and final assessment orders must be granted set-off while computing the final tax liability.
Income-tax Act, 1961	Section 80P	Orchid Suburbia Cooperative Housing Society Ltd. v. ITO	Click Here	Interest income earned by a cooperative housing society from FD investments with cooperative banks qualifies for deduction under Section 80P(2)(d), as cooperative banks remain cooperative societies under law.
Income-tax Act, 1961	Section 92C	Sanden Vikas India (P.) Ltd. v. ACIT, TP	Click Here	Under TNMM, broad functional comparability applies; hence, a company manufacturing auto components, gas compressors, and fans is acceptable as a comparable for a car air conditioner systems manufacturer.
Income-tax Act, 1961	Section 115BAA	Radiant Digital Solutions (P.) Ltd. v. PCIT	Click Here	Denial of Section 115BAA concessional tax rate due to non-filing of Form 10-IC was set aside as the delay was an inadvertent procedural lapse and condonation under Section 119(2)(b) ought to have been granted.
Income-tax Act, 1961	Section 115JB	PCIT v. Jindal Saw Ltd.	Click Here	Additions on account of Section 14A disallowance (read with Rule 8D) cannot be made to book profits under Section 115JB, as it is not covered under Explanation 1(f) to Section 115JB.
Income-tax Act, 1961	Section 143	Bilasa Medicals (P.) Ltd. v. ACIT	Click Here	An assessment completed under Section 143(3) by an ACIT without issuing a mandatory jurisdictional notice under Section 143(2) (where notice was previously issued by an ITO) is invalid.
Income-tax Act, 1961	Section 148	ACIT v. Rudra Alloys (P.) Ltd.	Click Here	Supreme Court remanded matters to High Courts for fresh adjudication in light of recent precedents regarding whether reassessment notices issued by JAOs instead of NFAC violate faceless schemes.
Income-tax Act, 1961	Section 149	Jay Bharat Dyeing and Printing (P.) Ltd. v. ACIT	Click Here	Reassessment orders and notices under Sections 148A(d) and 148 issued after the expiration of limitation under the new regime are invalid and quashed per Rajeev Bansal precedent.
Income-tax Act, 1961	Section 194C	Jayatma Technologies (P.) Ltd. v. DCIT	Click Here	Reopening assessment after four years on TDS applicability without fresh tangible material amounts to a mere change of opinion and is unsustainable.