Additions based on uncorroborated WhatsApp chats and selective reading of seized documents deleted Issue The central issue across these five distinct rulings is the evidentiary value of materials found during search and seizure operations—specifically, whether loose sheets, WhatsApp chats, and internal ledgers can be used to make additions under Sections 68 and 69A without… Read More »
Bonus to directors remanded for shareholding check; Non-reporting of transporter details under 194C(7) does not attract disallowance I. Bonus to Directors: Performance or Dividend in Disguise? Issue Whether a bonus paid to directors, which was disallowed by the Assessing Officer (AO) as being “in lieu of dividend” under Section 36(1)(ii), can be allowed as… Read More »
Government Grant for Rehabilitation of Cooperative Society Held as Capital Receipt, Not Taxable Income Issue Whether a grant-in-aid received by a co-operative milk union from the Government under a rehabilitation scheme should be treated as a capital receipt (non-taxable) or a revenue receipt (taxable income), specifically when the funds are intended to clear liabilities… Read More »
IMPORTANT INCOME TAX CASE LAWS 20.01.2026 Relevant Act Section Case Law Title Brief Summary Citation Income-tax Act, 1961 Section 2(15) CIT (Exemptions) v. Gujarat Industrial Development Corporation [Charitable Purpose] The development of industrial estates, roads, and drainage by a state corporation is a charitable activity. The sale of plots is incidental to this main object… Read More »
Section 264 Revision allowed to correct Assessee’s own data entry errors; PCIT’s rejection overturned Issue Whether the Principal Commissioner (PCIT) can reject a Revision application under Section 264 solely because the errors in the tax return (which led to a tax demand) were committed by the assessee (data entry/punching errors) and not by the… Read More »
Undated Satisfaction Note Vitiates Section 153C Proceedings; Jurisdiction Quashed Issue Whether the assumption of jurisdiction by the Assessing Officer (AO) under Section 153C is valid if the “Satisfaction Note”—a mandatory prerequisite—is undated in the official file, and there is an unexplained delay in supplying it to the assessee. Facts The Search: A search and… Read More »
Notice under Section 148 by Jurisdictional AO Quashed; Faceless Scheme Mandates FAO Jurisdiction Issue Jurisdiction under Faceless Scheme: Whether a notice under Section 148 (for income escaping assessment) can be issued by the Jurisdictional Assessing Officer (JAO) after the implementation of the Faceless Jurisdiction of Income Tax Authorities Scheme, 2022 and the e-Assessment of… Read More »
Case Transfer Upheld: Centralization for “Coordinated Investigation” trumps Assessee’s Inconvenience Issue Justification of Transfer: Whether the transfer of the petitioner’s income tax jurisdiction from Chandigarh to Panaji (Goa) under Section 127 is valid based on links found during a search on third parties. Section 127 vs. 158BD: Whether the Revenue is obligated to follow the… Read More »
Assessment quashed for ignoring assessee’s reply; Violation of Natural Justice Issue Whether an assessment order passed under the Faceless Assessment Scheme (Section 144B) is valid if the Assessing Officer (AO) completely overlooks the detailed reply and documents submitted by the assessee in response to a Show Cause Notice (SCN), thereby violating the principles of… Read More »
Capital Gains addition deleted; GPA is not a Joint Development Agreement (JDA) Issue Whether an addition for undeclared capital gains can be sustained against an assessee based on a document presumed to be a Joint Development Agreement (JDA), which was actually a General Power of Attorney (GPA), and where the assessee was not the… Read More »