LiveLawBiz Direct Tax Monthly Digest: July 2026
Kapil Dhyani
3 Aug 2026 9:27 PM IST
SUPREME COURT
Case Title : ASSISTANT COMMISSIONER OF INCOME TAX Versus M/S ATLANTIC GLOBAL SHIPPING PVT. LTD.
Case Number : Diary No. 25162-2026
The Supreme Court on Wednesday issued notice in the Income Tax Department's appeal challenging a Gujarat High Court judgment that held ST Shipping Pte Ltd, Singapore was entitled to the benefit of Article 8 of the India-Singapore Double Taxation Avoidance Agreement (DTAA). Under Article 8 of the DTAA, profits from the operation of ships in international traffic are taxable only in the country of residence. A bench of Justices P.S. Narasimha and Alok Aradhe while issuing notice on the Revenue's appeal said that it would assign a date for hearing the matter.
Case Title : PARVEEN KUMAR BANSAL Versus UNION OF INDIA AND ORS.
Case Number : W.P.(C) No. 843/2026
The Supreme Court on Tuesday declined to entertain a PIL seeking transfer of appellate jurisdiction under the Prohibition of Benami Property Transactions Act, 1988 (PBPT Act) from the Appellate Tribunal constituted under the Prevention of Money Laundering Act (PMLA) to the Income Tax Appellate Tribunal (ITAT). It, however, granted liberty to the petitioner to pursue his pending representation before the Union Government. At present, appeals under the PBPT Act are heard by the Appellate Tribunal constituted under the PMLA. The tribunal exercises jurisdiction under multiple statutes, including the PBPT Act, and functions through a single bench in New Delhi.
HIGH COURTS
Allahabad HC
Case Title : Justice Sandeep Jain v. Union of India & Ors.
A sitting judge of the Allahabad High Court, Justice Sandeep Jain, has approached the High Court challenging the denial of exemption of statutory allowances from his total income under the new tax regime. The plea was taken up on Monday before a bench of Justice Saumitra Dayal Singh and Justice Swarupama Chaturvedi, which called for instructions from the state on the petition. At the outset of the hearing, the bench asked the State's counsel whether there was any objection to it hearing the petition. After the state expressed no objection, the court called for instructions. It observed that the matter could not be heard ex-parte without calling for instructions. The court further observed that the interim relief sought was "in the nature of final relief."
Case Title : Principal Commissioner of Income Tax and another v. Ankur Mittal
Case Number : INCOME TAX APPEAL No. - 99 of 2026
CITATION : 2026 LLBiz HC (ALL) 53
The Allahabad High Court has recently held that under the Income Tax Act, 1961, the revenue has no right of appeal against an assessment order, as the assessment order is the stated case of the revenue itself. It held that where the revenue is aggrieved by an assessment order, its remedy is to seek revision where the assessment order is found to be "erroneous in so far as it is prejudicial to the interest of revenue." The court held that in an assessment proceeding the Assessing Authority acts as a quasi-judicial authority, raising his own doubts in the interest of the revenue and deciding them on the replies of the assessee, so that the resulting order cannot be appealed against by the revenue.
Allahabad High Court Flags Loophole In Income Tax Law On Reassessment After Taxpayer's Death
Case Title : Smt. Asha Dubey v. Union of India Thru. Secy. Ministry of Finance Deptt. Revenue Sectt. New Delhi and 2 others
Case Number : WRIT TAX No. - 571 of 2026
CITATION : 2026 LLBiz HC (ALL) 54
While holding that a reassessment notice under Section 148 of the Income Tax Act cannot be issued in the name of a dead assessee, the Allahabad High Court at Lucknow recently observed that the Act contains a legislative lacuna because it leaves the Revenue unable to initiate reassessment proceedings where an assessee dies before a valid reassessment notice is issued. Holding that the gap could result in escaped income going untaxed and prejudice the public exchequer, the court observed that the loophole ought to be plugged by Parliament. The court allowed the writ petition and quashed the notice issued under Section 148 in the name of the deceased assessee, along with all consequential reassessment proceedings.
Case Title : Smt. Asha Dubey v. Union of India Thru. Secy. Ministry of Finance Deptt. Revenue Sectt. New Delhi and 2 others
Case Number : WRIT TAX No. - 571 of 2026
CITATION : 2026 LLBiz HC (ALL) 54
The Allahabad High Court on 23 July held that an order quashing a reassessment notice issued in the name of a deceased person as void ab initio cannot be treated as a “finding” or “direction” under Section 150(1) of the Income Tax Act, 1961. A Bench of Justices Shekhar B. Saraf and Abdhesh Kumar Chaudhary quashed the reassessment proceedings initiated against Smt. Asha Dubey, holding that the Income Tax Department cannot rely on an order quashing a notice issued in the name of a deceased person to bypass the limitation period and issue a fresh notice to the legal representative.
Bombay HC
Bombay High Court Sets Aside Order Rejecting Naresh Goyal's Objections In Income Tax Reassessment
Case Title : Naresh Jagdishrai Goyal vs Deputy Commissioner of Income-tax Central Circle 5(2), Mumbai and Ors.
Case Number : WRIT PETITION NO. 3073 OF 2022
CITATION : 2026 LLBiz HC(BOM) 393
The Bombay High Court has recently set aside an order rejecting former Jet Airways chairman Naresh Goyal's objections to the reopening of his income tax assessment for the Assessment Year 2014-15. It directed the Assessing Officer to reconsider the objections after taking into account Goyal's March 8, 2022 letter and the annexures explaining the source of funds used to acquire Jet Airways (India) Ltd. shares.
Bombay High Court Says ITAT Took 'Pedantic Approach', Condones 1,797-Day Delay in Income Tax Appeals
Case Title : Uttar Bhartiya Education Society v. Principal Commissioner of Income Tax (Exemption) & Ors.
Case Number : Income Tax Appeal (L) Nos. 20375 of 2026 and 20379 of 2026
CITATION : 2026 LLBiz HC(BOM) 395
The Bombay High Court has set aside an Income Tax Appellate Tribunal (ITAT) order refusing to condone a 1,797-day delay in appeals filed by Uttar Bhartiya Education Society. Holding that the trust's explanation for the delay deserved due consideration, the court condoned the delay and restored the appeals for a decision on merits. A division bench of Justice G.S. Kulkarni and Justice Aarti Sathe held that the tribunal had adopted a "pedantic approach" while rejecting the charitable trust's plea for condonation of delay. It found that the trust had explained the reasons for the delay before both the Commissioner of Income Tax (Appeals) and the ITAT.
Case Title : Shreenath Finstock Private Ltd. v. Union of India & Ors.
Case Number : Writ Petition No. 3526 of 2022
CITATION : 2026 LLBiz HC(BOM) 396
The Bombay High Court has held that an income tax reassessment notice dated and digitally signed on March 31, 2021, cannot be treated as having been issued on that date if it was actually dispatched through the Income Tax Business Application (ITBA) portal and reached the assessee only on April 1, 2021. The court ruled that the notice would be deemed to have been issued on April 1, 2021, and the reassessment proceedings must continue under the framework introduced by the Finance Act, 2021.
Case Title : Pr. Commissioner of Income Tax-2 v. The Tata Power Company Ltd.
Case Number : Income Tax Appeal no. 21 of 2020
CITATION : 2026 LLBiz HC(BOM) 412
The Bombay High Court has recently dismissed an appeal filed by the Income Tax Department against The Tata Power Company Ltd. It held that income from trial runs of its broadband project and the sale of scrap generated before the project's installation were capital receipts not liable to tax. Observing that income generated before the commencement of business that is "inextricably connected with the setting up of a capital asset" is capital in nature and serves to reduce the cost of construction, the court held that the ITAT's order did not give rise to any substantial question of law.
Bombay High Court Quashes Criminal Prosecution For Late ITR Filing As Taxpayer Entitled To Refund
Case Title : Rajesh Somandas Sachdev v. Income Tax Officer & Ors.
Case Number : Writ Petition No. 5692 of 2025
CITATION : 2026 LLBiz HC(BOM) 414
The Bombay High Court on 22 July held that criminal prosecution for failure to file an income tax return cannot continue when a subsequent assessment shows that the taxpayer had no tax liability and was instead entitled to a refund, as continuing such proceedings would serve no purpose where the Revenue suffered no loss. Justice Madhav J. Jamdar quashed the criminal complaint that the Income Tax Department filed against Rajesh Somandas Sachdev under Section 276CC of the Income Tax Act (which penalises wilful failure to furnish an income tax return), holding that the Supreme Court's ruling in Guru Nanak Enterprises v. Income Tax Officer squarely covered the case.
Mere Delay In Paying Income Tax Does Not Amount To Wilful Tax Evasion: Bombay High Court
Case Title : Dinar Tarcar Resources (India) Pvt. Ltd. & Ors. v. The Income Tax Department.
Case Number : Criminal Writ Petition No. 202 of 2026
CITATION : 2026 LLBiz HC(BOM) 421
The Goa bench of the Bombay High Court has held that mere delay in paying an admitted tax liability, without a deliberate intention to evade payment, does not amount to a "wilful attempt" to evade tax. Justice Amit S. Jamsandekar observed that criminal prosecution requires proof of mens rea and cannot be invoked merely because there has been a delay or failure in paying tax. "The word 'wilful' introduces a mental element and requires looking into the mind of a person by gauging the person's actions indicative of one's state of mind. Thus, in order to prosecute a person under Section 276-C(2), the conduct of a person acquires importance. A person, in such a case, ought to have deliberately, intentionally and consciously made attempts to evade payment of tax, penalty or interest under the I.T. Act. It does not include an unintentional act, an accidental act or a casual act or genuine inability. The word 'wilful' used in the Section imports the concept of mens rea in the requirement of the Section. Therefore, on mere delay or mere failure without there being mens rea, the provisions of the Section cannot be invoked.", the court held.
Case Title : Principal Commissioner of Income Tax, Central-4 v. Aurum Ventures Private Limited
Case Number : Income Tax Appeal No. 663 of 2024
CITATION : 2026 LLBiz HC(BOM) 422
The Bombay High Court has dismissed two appeals filed by the Income Tax Department, upholding an Income Tax Appellate Tribunal order that deleted additions made to a company's completed income tax assessments after finding they were not based on incriminating material recovered during a search. The court found that no substantial question of law arose for consideration. A division bench of Justice G.S. Kulkarni and Justice Aarti Sathe agreed with the tribunal that the Assessing Officer had based the additions on the company's regular books of account. The bench held that the tribunal's decision was consistent with the settled legal position on completed assessments after a search.
Delhi HC
Delhi High Court Quashes ₹21 Crore Block Assessment Over Failure To Issue Mandatory Scrutiny Notice
Case Title : Sun Aero Ltd v. Principal Commissioner Of Income Tax
Case Number : ITA 527/2017
CITATION : 2026 LLBiz HC (DEL) 697
The Delhi High Court has reiterated that issuance of a notice under Section 143(2) of the Income Tax Act, 1961, is mandatory for completing block assessments under Section 158BC of the Act. A Division Bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta relied on Assistant Commissioner of Income Tax vs. Hotel Blue Moon (2010), where the Supreme Court held that the omission to issue such notice is not a curable procedural irregularity.
Case Title : Delhi Tax Bar Association Through Its Secretary K G Bansal v. Union of India & Anr.
Case Number : W.P.(C) 9365/2026
CITATION : 2026 LLBiz HC (DEL) 721
The Delhi High Court, by way of an interim direction, has allowed Supreme Court and High Court judges to file their income tax returns by showing prescribed judicial allowances as “receipts not in the nature of income”, even while opting for the new tax regime. The order came in a petition filed by the Delhi Tax Bar Association challenging a September 12, 2025, Office Memorandum issued by the CBDT, which, according to the petitioner, denied judges opting for the new tax regime the benefit of specified judicial allowances.
NFAC Must Provide Video Conferencing If Assessee Seeks Personal Hearing: Delhi High Court
Case Title : High Vista Buildcon Pvt. Ltd. (Earlier Known As Vikram Electric Equipment Pvt. Ltd.) v. National Faceless Appeal Centre (NFAC) Delhi & Ors.
Case Number : W.P.(C) 4594/2026
CITATION : 2026 LLBiz HC (DEL) 729
The Delhi High Court has held that a taxpayer who seeks a personal hearing during appellate proceedings before the NFAC is entitled to such a virtual hearing. “There are various issues which can be better explained with the help of personal or virtual assistance by assessee or its authorised representative. Mere written submissions or memo of appeal are not sufficient for proper adjudication,” division bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta observed. The court thus set aside an order of the Commissioner of Income Tax (Appeals) NFAC, passed without hearing the assessee despite requests.
Case Title : Pr. Commissioner Of Income Tax , Delhi-7 v. Rohde And Schwarz India Pvt. Ltd.
Case Number : ITA 575/2026
CITATION : 2026 LLBiz HC(DEL) 742
The Delhi High Court has admitted the Income Tax Department's appeal to examine whether the statutory deadline for passing income tax assessment orders under Section 153 also governs final assessment orders passed under Section 144C, which lays down a separate assessment procedure for eligible assessees. Section 144C of the Act prescribes a special assessment procedure involving a draft assessment order, review by the Dispute Resolution Panel (DRP), and the passing of a final assessment order for certain eligible assessees.
Case Title : American Express Banking Corporation (India Branch) v. Deputy Commissioner Of Income Tax
Case Number : ITA 367/2025, CM APPL. 54359/2025, CM APPL. 37792/2026
CITATION : 2026 LLBiz HC(DEL) 750
The Delhi High Court has stayed the operation of a draft assessment order passed against American Express Banking Corporation (India Branch) while admitting the company's income tax appeal raising multiple questions of law relating to transfer pricing adjustments, including the validity of the Bright Line Test (BLT) and the Transfer Pricing Officer's (TPO) methodology. A division bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta noted that by an interim order dated May 29, 2026, it had permitted the Assessing Officer to pass a draft assessment order while directing that it should not be given effect to.
Delhi High Court Admits Appeal On Taxability Of Demonetisation-Era Cash Deposits
Case Title : Principal Commissioner Of Income Tax Delhi-20 v. Satish Kumar
Case Number : ITA 384/2026
CITATION : 2026 LLBiz HC(DEL) 751
The Delhi High Court has admitted the Income Tax Department's appeal against an ITAT order deleting additions to income based on an assessee's cash deposits made during the demonetisation period. A Division Bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta agreed to examine whether the Tribunal rightly deleted the addition under Section 69A of the Income Tax Act, relating to cash deposits made during the demonetisation period, despite the Revenue's contention that the deposits were disproportionate to cash sales in the corresponding period of earlier years.
Case Title : Sahara India Commercial Corporation Ltd. v. Assistant Commissioner of Income Tax
Case Number : ITA 551/2026
CITATION : 2026 LLBiz HC (DEL) 753
The Delhi High Court has held that the Commissioner of Income Tax (Appeals) cannot enhance a tax disallowance without first issuing a statutory notice to the assessee, observing that failure to do so violates both Section 251(2) of the Income Tax Act, 1961 and the principles of natural justice. The division bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta thus set aside the enhancement of a disallowance from ₹11.05 crore to ₹16.74 crore made against Sahara India Commercial Corporation Ltd.
Case Title : The Pr. Commissioner Of Income Tax -Central -1 v. Spicejet Limited
Case Number : ITA 539/2026 + ITA 540/2026
CITATION : 2026 LLBiz HC (DEL) 754
The Delhi High Court has dismissed two appeals filed by the Income Tax Department against SpiceJet Ltd., holding that the tax treatment of premium payable on redemption of Foreign Currency Convertible Bonds (FCCBs) is a settled issue. A division bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta observed that the issue raised by the Revenue—whether the expenditure on FCCB redemption premium ought to be spread over the five-year life of the bonds instead of being claimed in the first year—stands concluded by earlier decisions of the Delhi High Court.
'Something Seriously Amiss': Delhi High Court Flags Delays In Direct Tax Vivad Se Vishwas Refunds
Case Title : Yashita Finance Private Limited v. Principal Commissioner Of Income Tax -7, Delhi & Ors.
Case Number : W.P.(C) 9605/2026
CITATION : 2026 LLBiz HC (DEL) 759
The Delhi High Court on Tuesday (July 28) expressed concern over recurring delays by the Income Tax Department in processing refunds under the Direct Tax Vivad Se Vishwas Scheme, 2024, observing that there was "something seriously amiss" in the system as assessees were routinely approaching the High Court for release of refunds. The Division Bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta directed the Chairman of the Central Board of Direct Taxes (CBDT) to ascertain whether the Department's claim regarding the absence of a functional IT system was correct and, if so, ensure that necessary modules are put in place so that refunds are credited promptly, preferably within 90 days of issuance of Form No. 4.
Case Title : Clix Capital Services Private Limited As A Successor To Clix Finance India Private Limited v. The Dy. Commissioner Of Income Tax, Circle 4 2, New Delhi & Ors.
Case Number : W.P.(C) 10111/2026
CITATION : 2026 LLBiz HC (DEL) 761
The Delhi High Court on Tuesday (July 28) directed an Assessing Officer to personally explain the four-year delay in taking steps to release over ₹15 crore due to Clix Capital Services Pvt. Ltd. A Division Bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta directed the officer involved to personally appear before the Court and show cause why the interest payable for the delay should not be recovered from his salary.
Gauhati HC
Case Title : Biswajit Deb v. Union of India & Ors.
Case Number : WP(C) No. 1929 of 2022
CITATION : 2026 LLBiz HC(GAU) 23
The Gauhati High Court has quashed reassessment proceedings initiated under Income Tax Act, holding that the Assessing Officer (AO) reopened the assessment without first verifying the petitioner's transactions. Referring to the AO's own recorded reasons that beneficiary-wise transactions could not be identified "due to paucity of time", Justice N. Unni Krishnan Nair held, "The recording of reason by the Assessing Officer in paragraph 5 of being unable to carry out investigation for identifying the transactions for each of the beneficiaries involved, due to paucity of time, would go to reveal that the notices were being issued only to carry out such verification. This court also holds that such reopening of assessment would not be permitted for a fishing or roving enquiry."
Gujarat HC
Case Title : Bipinkumar Girdharlal Parekh v. Office of the Assistant Commissioner of Income Tax, Circle 4(1)(1), Ahmedabad
Case Number : R/Special Civil Application No. 15105 of 2025
CITATION : 2026 LLBiz HC(GUJ)82
The Gujarat High Court has held that the earlier reassessment regime can apply even where the assessee was not the person searched, provided the reassessment is founded on incriminating material recovered during a search conducted within the statutory transition period. Applying that principle, the court quashed reassessment proceedings against a transporter after holding that the reopening notice had been issued beyond the applicable limitation period.
Case Title : Jitendra Shankarlal Mistri v. Income Tax Officer, Ward-1 & Anr.
Case Number : R/Special Civil Application No. 7485 of 2026 (with connected matters)
CITATION : 2026 LLBiz HC(GUJ)87
The Gujarat High Court on 29 June held that a reassessment notice cannot be challenged through a writ petition after reassessment proceedings have culminated in an assessment order. A Division Bench comprising Justices A.S. Supehia and Vaibhavi D. Nanavati dismissed the writ petitions filed by Jitendra Shankarlal Mistri and others, holding that the petitioners could avail the statutory remedy of appeal against the reassessment orders before the Commissioner of Income Tax (Appeals).
Gujarat High Court Quashes Income Tax Reassessment Over Pre-2012 Property Valuation Rule
Case Title : Late Padmaben Zinabhai Trivedi v. Income Tax Officer
Case Number : R/Special Civil Application No. 19363 of 2017
CITATION : 2026 LLBiz HC(GUJ)88
The Gujarat High Court has quashed an income tax reassessment notice issued over the valuation of land sold in 2009. It held that the reassessment in the case was unsustainable because the assessing officer sought to adopt a lower fair market value despite the unamended law governing the assessment. A division bench of Justice A.S. Supehia and Justice Vaibhavi D. Nanavati held that the amendment made to Section 55A through the Finance Act, 2012 applied only prospectively. It therefore could not govern Assessment Year 2010-11.
Case Title : Vimal Oil and Foods Limited v. Assistant Commissioner of Income Tax, Circle, Gandhinagar
Case Number : R/Special Civil Application No. 13194 of 2023
CITATION : 2026 LLBiz HC(GUJ)93
The Gujarat High Court on 30 June quashed reassessment proceedings against Vimal Oil and Foods Ltd., holding that the Assessing Officer cannot reopen an assessment of a company sold as a going concern under the Insolvency and Bankruptcy Code (IBC) on mere assumptions without verifying whether any income had actually escaped assessment. A Division Bench of Justices A.S. Supehia and Vaibhavi D. Nanavati allowed the batch of writ petitions filed by the company and quashed the notice issued under Section 148 and the order passed under Section 148A(d) of the Income Tax Act for Assessment Year 2019-20.
Case Title : Virendra Naginbhai Patel (HUF) v. Income Tax Officer, Ward 1(2)(5)
Case Number : R/Special Civil Application No. 20401 of 2019
CITATION : 2026 LLBiz HC(GUJ)94
The Gujarat High Court has recently held that an Assessing Officer is not deemed to have noticed facts disclosed in a wealth tax return while examining an income tax return. It refused to interfere with reassessment proceedings initiated against a Hindu Undivided Family (HUF) over an unexplained cash payment of more than ₹1.02 crore towards the purchase of immovable property. A Division Bench of Justice A.S. Supehia and Justice Vaibhavi D. Nanavati dismissed the writ petition filed by Virendra Naginbhai Patel (HUF), which challenged the reassessment notice issued for Assessment Year 2012-13.
Case Title : Datta Projects Private Limited v. Assistant Commissioner of Income Tax, Vapi Circle, Vapi
Case Number : R/Special Civil Application No. 21134 of 2019
CITATION : 2026 LLBiz HC(GUJ)96
The Gujarat High Court has quashed reassessment proceedings initiated under the Income Tax Act, holding that a completed assessment cannot be reopened merely on the presumption that an assessee collected unaccounted cash ("on-money") from buyers over and above the recorded sale price because its sister concern was found to have done so. The court held that the reopening against Datta Projects was based entirely on presumptions and surmises, without any material linking the assessee to undisclosed income. A Division Bench of Justice A.S. Supehia and Justice Vaibhavi D. Nanavati allowed the writ petition filed by Datta Projects Pvt. Ltd. and quashed the notice issued under Section 148 of the Income Tax Act for Assessment Year 2012-13.
Case Title : Late Padmaben Zinabhai Trivedi v. Income Tax Officer
Case Number : R/Special Civil Application No. 19363 of 2017
CITATION : 2026 LLBiz HC(GUJ)97
The Gujarat High Court ruled that the 2012 amendment to Section 55A(a) of the Income Tax Act, which expanded the Assessing Officer's power to refer capital assets for valuation, cannot be applied retrospectively. The court ruled that assessments relating to the period prior to 1 July 2012 would continue to be governed by the unamended provision and, on that basis, quashed a reassessment notice issued to the assessee. A Division Bench of Justice A.S. Supehia and Justice Vaibhavi D. Nanavati passed the ruling while allowing a writ petition filed by the legal heir of late Padmaben Zinabhai Trivedi, who had challenged a notice issued under Section 148 for AY 2010-11.
Gujarat High Court Quashes Reassessment Notice Issued Beyond COVID-Era TOLA Deadline
Case Title : Wealth First Portfolio Managers Limited v. Assistant Commissioner of Income Tax
Case Number : R/Special Civil Application No. 23218 of 2022
CITATION : 2026 LLBiz HC (GUJ) 101
The Gujarat High Court has quashed a reassessment notice issued under Section 148 of the Income Tax Act, holding that it was issued beyond the "surviving time" available under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA), as interpreted by the Supreme Court in Union of India v. Rajeev Bansal. TOLA was enacted to extend statutory timelines for tax and other legal proceedings during the COVID-19 pandemic.
Three Days To Reply To Income Tax SCN Not Reasonable: Gujarat High Court Quashes Assessment
Case Title : SN Advance Ventures Private Limited v. Assistant Commissioner of Income Tax Assessment Unit & Anr.
Case Number : R/Special Civil Application No. 6284 of 2026
CITATION : 2026 LLBiz HC (GUJ) 102
The Gujarat High Court recently held that granting a taxpayer only three days to respond to an income tax show cause notice does not amount to a reasonable opportunity of hearing and violates the principles of natural justice. Setting aside an income tax assessment order passed after scrutiny proceedings, a Division Bench of Justice A.S. Supehia and Justice Vaibhavi D. Nanavati observed, "Thus, in view of the settled legal position, granting only three days' time to file a reply cannot be said to be a reasonable opportunity. The Assessing Officer ought to have considered and decided the petitioner's grievance dated 16.03.2026, wherein objection was raised regarding the inadequate time granted for filing the reply."
Case Title : Institute of Fire Safety Disaster Management Studies v. Assistant Commissioner of Income Tax, Circle 1(1)(1) & Anr.
Case Number : R/Special Civil Application No. 6872 of 2025
CITATION : 2026 LLBiz HC (GUJ) 103
The Gujarat High Court has recently held that a public trust cannot be treated as a "concern" under the deemed dividend provisions of the Income Tax Act (Section 2(22)(e)) merely because its trustee holds substantial shares in the lending company. Holding that the legal fiction created by the provision cannot be stretched to cover such trusts, the court observed, "The word "concern" used under the Act in such Explanation, which encompasses a Hindu Undivided Family (HUF), or a firm, or an association of persons or a body of individuals or a company cannot be extended to public Trust and they cannot be classified as a "concern" for the purpose of specific tax fiction. Thus, even if a loan is extended to a public Trust by a Private Limited Company, that usually cannot be treated as a deemed dividend under Section 2(22)(e) of the Act."
Case Title : Commissioner of Income Tax (Exemptions), Ahmedabad v. Bhavnagar Mandap Contractors Association
Case Number : R/Tax Appeal No. 467 of 2025
CITATION : 2026 LLBiz HC (GUJ) 104
The Gujarat High court has recently upheld an Income Tax Appellate tribunal order directing the Commissioner of Income Tax (Exemptions) to reconsider a trade association's application for registration as a charitable institution. It held that trade promotion bodies established to advance trade and commerce can qualify as charitable institutions under the "general public utility" category of the Income Tax Act. A division bench of Justice Bhargav D. Karia and Justice Pranav Trivedi said the Bhavnagar Mandap Contractors Association's objects were aimed at advancing trade and business for its members as well as the public at large.
Jharkhand HC
Jharkhand High Court Upholds Conviction For False Income Tax Refund Claim Based On Forged Documents
Case Title : Sashi Bhusan Prasad Bhuian @ Shashi Bhusan Prasad Bhuia v. State of Jharkhand & Anr.
Case Number : Criminal Revision No. 5 of 2017
CITATION : 2026 LLBiz HC (JHAR) 13
The Jharkhand High Court has upheld the conviction of an Eastern Coalfields Limited employee for claiming an income tax refund of ₹35,875 on the basis of forged documents. The court found no reason to interfere with the concurrent findings of the trial and appellate courts. Justice Pradeep Kumar Srivastava dismissed the criminal revision filed by Sashi Bhusan Prasad Bhuian. The court directed him to surrender before the trial court within two months to undergo the remaining sentence. The court observed, "From the impugned judgment, it is crystal clear that present petitioner has claimed on the basis of forged document, a refund of Rs. 35,875/- for which no valid explanation or reasons has been furnished by him."
Karnataka HC
Case Title : Principal Commissioner of Income Tax v. Unisys India Pvt. Ltd. c/w Principal Commissioner of Income Tax v. H.K. Suresh
Case Number : ITA No. 55 of 2024 c/w ITA No. 216 of 2023
CITATION : 2026 LLBiz HC(KAR) 117
The Karnataka High Court has held that an income tax order initially communicated without a Document Identification Number (DIN) does not become invalid merely because the DIN is communicated later through a separate authenticated intimation letter. The court held that the procedure substantially complied with CBDT Circular No. 19/2019 as it maintained the audit trail and authenticity of departmental communications. A Division Bench of Justice S.G. Pandit and Justice K.V. Aravind allowed two appeals filed by the Revenue against orders of the Income Tax Appellate Tribunal (ITAT), Bengaluru.
Karnataka High Court Holds S. 271DA Penalty Begins Only With S. 274 Notice, Reads In Six Month Limit
Case Title : Joint Commissioner of Income Tax & Anr. v. Ganesh Agarwal & Connected Matters
Case Number : WA No. 1991 of 2025 c/w WA Nos. 1977, 1980, 1982, 1994, 1995, 1996, 2003, 2021 & 2023 of 2025
CITATION : 2026 LLBiz HC(KAR) 118
The Karnataka High Court on 7 July held that penalty proceedings under Section 271DA of the Income Tax Act commence only when the Joint Commissioner issues a show cause notice under Section 274, and not when the Assessing Officer merely forwards a proposal for initiating penalty. A Division Bench of Justices S.G. Pandit and K.V. Aravind partly allowed a batch of ten Revenue appeals, clarifying that, although the Act does not prescribe a time limit for issuing a notice under Section 274, the Joint Commissioner must issue it within six months from the end of the month in which the proposal is received from the Assessing Officer.
Case Title : Pr. Commissioner of Income Tax v. Shri Ravi Shankar Shetty
Case Number : INCOME TAX APPEAL NO. 225 OF 2021
CITATION : 2026 LLBiz HC(KAR) 122
The Karnataka High Court has upheld the deletion of a ₹21.11 crore tax addition made against a Bengaluru-based businessman engaged in identifying and procuring land for real estate projects. The court held that advances received in the course of that business cannot be taxed merely because they remained outstanding for several years. The court observed that the mere passage of time does not amount to forfeiture, and such advances cannot be treated as taxable income in the absence of material showing that the recipient had become absolutely entitled to retain the money.
Madras HC
Madras High Court Holds Employer Cannot Grant Section 89 Tax Relief Without Form 10E From Employees
Case Title : Hosur Bata Employees Union v. The Principal Chief Commissioner of Income Tax
Case Number : W.P.No.4601 of 2026
CITATION : 2026 LLBiz HC(MAD) 169
The Madras High Court on 24 June held that employers deducting Tax Deducted at Source (TDS) on voluntary retirement compensation cannot be faulted for not granting relief under Section 89 of the Income Tax Act (relief for salary received in arrears or advance) unless employees submit the prescribed Form 10E. Justice C. Saravanan allowed the writ petition filed by the Hosur Bata Employees Union in part and directed the Income Tax Department to process the income tax returns of affected employees and refund any eligible TDS amount, while holding that Bata India Ltd. had acted in accordance with its statutory obligation to deduct tax.
Case Title : Nate Nandha v. Assistant Commissioner of Income Tax
Case Number : W.P.Nos.11340/2023
CITATION : 2026 LLBiz HC(MAD) 170
The Madras High Court has held that Jurisdictional Assessing Officers have the authority to issue reassessment notices under Sections 148A, 148 and 147 of the Income Tax Act, 1961, observing that the retrospective insertion of Section 147A has clarified their jurisdiction to initiate proceedings for income escaping assessment. Justice C. Saravanan dismissed a batch of writ petitions challenging reassessment proceedings initiated by Jurisdictional Assessing Officers, holding that the petitioners had only questioned the officers' jurisdiction and had not challenged the constitutional validity of Section 147A, which could be examined only by a Division Bench.
Madras High Court Quashes Reassessment Based On Material Already Examined During Original Assessment
Case Title : M/s.Schwing Stetter (India) Private Limited v. Additional /Joint/ Deputy/ Assistant Commissioner of Income Tax/ Income Tax Officer
Case Number : WP No. 6230 of 2022
CITATION : 2026 LLBiz HC(MAD) 171
The Madras High Court has recently set aside reassessment proceedings initiated against an engineering equipment manufacturer after finding that the Income Tax Department reopened the assessment based on material that had already been disclosed and examined during the original assessment. Justice Senthilkumar Ramamoorthy observed that the reassessment amounted to an impermissible change of opinion.
Madras High Court Grants Stay On ₹101.14 Crore TDS Penalty Recovery Against Cognizant
Case Title : Cognizant Technology Solutions v. Assistant Commissioner of Income Tax
Case Number : WP Nos.25670/2026
CITATION : 2026 LLBiz HC(MAD) 178
The Madras High Court on 6 July granted interim relief to Cognizant Technology Solutions India Private Limited by staying recovery proceedings arising from tax deducted at source (TDS) penalty demands exceeding Rs. 101.14 crore. A Bench of Justice Senthilkumar Ramamoorthy found that the company had established a prima facie case, directed it to deposit Rs. 4 crore within two months, and stayed recovery of the balance penalty amount until the Commissioner of Income Tax (Appeals) decides the pending appeals and for two weeks thereafter.
Madras High Court Quashes ₹13.48 Cr Misreporting Penalty On Ennore Tank Terminals For Vague Notice
Case Title : M/s. Ennore Tank Terminals Private Limited v. The Additional /Joint /Deputy / Assistant
Case Number : WP No. 10711 of 2022
CITATION : 2026 LLBiz HC(MAD) 206
The Madras High Court on 20 July set aside a penalty of over Rs. 13.48 crore imposed on Ennore Tank Terminals Private Limited, holding that the Income Tax Department cannot penalise a taxpayer for alleged misreporting of income unless it clearly informs the taxpayer of the basis for such allegation in the show cause notice. Justice Senthilkumar Ramamoorthy held that proceedings for misreporting of income carry serious consequences, including a penalty of 200% of the tax payable on under-reported income and denial of statutory immunity.
Telangana HC
Case Title : DBS Technology Services India Private Limited v. Assistant Commissioner of Income Tax
Case Number : WRIT PETITION NO.19502 OF 2025
CITATION : 2026 LLBiz HC (TEL) 46
The Telangana High Court on 3 July held that the Income Tax Department cannot reject a genuine claim for deduction on the sole ground of a technical or procedural lapse if the taxpayer is otherwise entitled to the benefit. A Division Bench of Justices P. Sam Koshy and Suddala Chalapathi Rao set aside the order rejecting the deduction claimed by DBS Technology Services India Private Limited and directed the Assessing Officer to reconsider the company's claim in accordance with law.
Telangana High Court Upholds Capital Gains Tax Exemption Despite Delay In Villa Registration
Case Title : Sudhakar Reddy Mettu v. Assistant Commissioner of Income Tax
Case Number : INCOME TAX TRIBUNAL APPEAL No.78 of 2025
CITATION : 2026 LLBiz HC (TEL) 52
The Telangana High Court has held that a taxpayer who invested capital gains in a residential villa under a joint development agreement cannot be denied tax exemption merely because the developer delayed construction and execution of the sale deed. The court observed that delays beyond the assessee's control cannot defeat the benefit intended under the law. A Division Bench of Justice P. Sam Koshy and Justice Narsing Rao Nandikonda allowed the appeal filed by non-resident Indian Sudhakar Reddy Mettu. It set aside the Income Tax Appellate Tribunal's order denying him the exemption.
ITAT
ITAT Delhi Quashes Search Assessment Over Defective Consolidated Satisfaction Note
Case Title : Sunwhite Realty Private Limited v. DCIT, Central Circle-6
Case Number : ITA No. 9135/Del/2025
CITATION : 2026 LLBiz ITAT(DEL) 216
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has quashed a search assessment against Sunwhite Realty Private Limited over a defective satisfaction note recorded for multiple assessment years. A bench of Judicial Member Anubhav Sharma and Accountant Member M. Balaganesh allowed the company's appeal against the assessment for the assessment year 2016–17. The assessment arose from a search conducted in the Ashish Begwani group cases. Sunwhite Realty challenged the Assessing Officer's jurisdiction. It argued that the proceedings had been initiated on the basis of a consolidated satisfaction note covering several assessment years. The company also contended that the note did not identify the seized material pertaining to it. Nor did it specify the assessment year to which those entries related.
ITAT Ahmedabad Allows Former BSNL Employee's Claim For Tax Exemption On VRS Compensation
Case Title : Jashvantbhai Ashabhai Patel v. Income Tax Officer, Ward-7(2)(1), Ahmedabad
Case Number : ITA No. 1145/Ahd/2026
CITATION : 2026 LLBiz ITAT(AHM) 215
The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench, has recently allowed a former BSNL employee's claim for exemption on compensation received under the BSNL Voluntary Retirement Scheme (VRS). The tribunal held that he was entitled to the benefit under Section 10(10B) of the Income Tax Act by following earlier coordinate Bench decisions on the issue. Section 10(10B) of the Income Tax Act provides a tax exemption for eligible retrenchment compensation received by an employee, subject to the prescribed conditions.
ITAT Jodhpur Deletes Business Expense Disallowance For Lack Of Adverse Findings
Case Title : Svaraj Trading and Agencies Ltd. & Ors. v. Assistant Commissioner of Income Tax, Central Circle-1, Udaipur
Case Number : ITA Nos. 777/Jodh/2025 & Connected Matters
CITATION : 2026 LLBiz ITAT(JOD) 217
The Income Tax Appellate Tribunal (ITAT), Jodhpur, has allowed a batch of appeals filed by four companies, holding that business expenditure cannot be disallowed merely because the tax authorities considered the assessees to have minimal business activity. The tribunal found no adverse evidence questioning the genuineness of the expenditure and held that the disallowances sustained by the first appellate authority could not be justified on mere suspicion.
Case Title : Global Cricket Corporation Pte. Ltd. v. Additional Director of Income Tax (International Taxation), Range-3, Mumbai
Case Number : ITA Nos. 2161 & 2162/Mum/2014
CITATION : 2026 LLBiz ITAT(MUM) 218
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has quashed reassessment proceedings against Global Cricket Corporation Pte. Ltd.. The tribunal did so after finding that the Income Tax Department failed to establish that it had issued the mandatory notice before completing the reassessment. Global Cricket Corporation Pte. Ltd. is a Singapore-based sports rights and sports event management company involved in the management and promotion of sporting events.
ITAT Mumbai Rules Barclays Bank's Interest From Overseas Branches Not Taxable In India
Case Title : Barclays Bank PLC v. Additional Commissioner of Income Tax & Connected Appeals
Case Number : ITA No. 5514/Mum/2001
CITATION : 2026 LLBiz ITAT(MUM) 219
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has held that interest earned by the Indian branches of Barclays Bank PLC from its Head Office, overseas branches and other overseas banks is not taxable in India. It ruled that transactions between the Indian branch and its Head Office amount to payments to self and cannot give rise to taxable income under domestic tax law. A bench of Vice President Saktijit Dey and Accountant Member Prabhash Shankar observed that, while a permanent establishment may be treated as a distinct entity for attributing profits under a tax treaty, the Indian branch and the Head Office remain the same legal entity under domestic tax law.
Case Title : Sterling Holiday Resorts Limited v. Deputy Commissioner of Income Tax & Cross Appeals
Case Number : ITA Nos. 843/MUM/2024 and 941/MUM/2024
CITATION : 2026 LLBiz ITAT(MUM) 220
A holding company cannot issue shares on behalf of its subsidiary to satisfy the conditions for claiming tax benefits arising from a demerger, the Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has held. "The Holding company cannot issue shares on behalf of the subsidiary and its obligations are restricted to its own legal liabilities and obligations under the law," the tribunal observed. A bench of Vice President Saktijit Dey and Accountant Member Prabhash Shankar partly allowed Sterling Holiday Resorts Limited's appeal and dismissed the Revenue's cross-appeal for the assessment year 2015-16.
ITAT Jaipur Upholds CA Student's Claim For Section 87A Rebate On Short-Term Capital Gains Tax
Case Title : Priyamvada Singhal v. DCIT-Circle 7, Jaipur
Case Number : ITA No. 1412/JPR/2025
CITATION : 2026 LLBiz ITAT(JAI) 221
The Jaipur Bench of the Income Tax Appellate Tribunal (ITAT) on 25 June held that a resident individual who opts for the new tax regime under Section 115BAC of the Income Tax Act and whose total income falls within the prescribed threshold is entitled to claim rebate under Section 87A even against tax payable on short-term capital gains under Section 111A. Accountant Member Annapurna Gupta allowed an appeal filed by Priyamvada Singhal, a CA student and directed the Revenue to grant the rebate for Assessment Year 2024–25. She observed: “I hold therefore that the denial of grant of rebate to the assessee u/s 87A of the Act is not in accordance with law. I accordingly direct that the assessee be granted the rebate u/s 87A of the Act.”
ITAT Mumbai Holds Tax Appeals Infructuous After Company's Liquidation And Sale As Going Concern
Case Title : EMI Transmission Limited v. DCIT, Central Circle-8(1), Mumbai
Case Number : ITA Nos. 1071/Mum/2026
CITATION : 2026 LLBiz ITAT(MUM) 222
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has held that no effective adjudication survives in income tax appeals filed by EMI Transmission Limited after the company underwent liquidation under the Insolvency and Bankruptcy Code (IBC). It noted that the company had been sold as a going concern and the liquidation proceedings had been closed by the National Company Law Tribunal (NCLT). A bench of Judicial Member Amit Shukla and Accountant Member Girish Agrawal was hearing EMI Transmission Limited's appeals for assessment years 2011-12 to 2018-19 against orders sustaining various income tax additions.
ITAT Mumbai Deletes ₹572.83 Crore Brand Royalty Transfer Pricing Adjustment Against Vodafone Idea
Case Title : Vodafone Idea Limited (Successor of Vodafone Mobile Services Limited) v. ACIT, Circle-26(2), New Delhi
Case Number : ITA No. 8971/DEL/2019
CITATION : 2026 LLBiz ITAT(MUM) 223
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has deleted a ₹572.83 crore transfer pricing adjustment on Vodafone Idea Ltd.'s payment of brand royalty. It held that the controlled transaction relied on by the tax department could not be used as a comparable under the Comparable Uncontrolled Price (CUP) method. A bench of Accountant Member Om Prakash Kant and Judicial Member Anikesh Banerjee observed: "The Coordinate Benches of the Tribunal, while dealing with identical transfer pricing adjustments in the assessee's own case for Assessment Years 2011-12, 2012-13 and 2013-14, as well as in the cases of its group concerns referred to hereinabove, have consistently held that the agreement entered into between Virgin Enterprises Ltd. and Virgin Mobile USA LLC, being a controlled transaction, cannot constitute a valid comparable for determining the arm's length price under the CUP Method. The Tribunal has further held that the arm's length price of an international transaction has to be determined only by comparing it with comparable uncontrolled transactions in accordance with Rule 10B of the Income-tax Rules, 1962. The Revenue has not brought to our notice any distinguishing feature in the facts of the year under consideration nor any subsequent judicial pronouncement taking a contrary view."
ITAT Delhi Restores ₹1.43 Crore Addition Over Alleged Cash Salary Payments
Case Title : DCIT v. ECR Buildtech Pvt. Ltd.
Case Number : ITA No. 9107/Del/2025 (Cross Objection No. 56/Del/2026)
CITATION : 2026 LLBiz ITAT(DEL) 224
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has recently upheld an addition of ₹1.43 crore towards alleged unexplained cash salary payments. It held that the Commissioner of Income Tax (Appeals) deleted the addition without carrying out any inquiry or seeking a remand report despite the material relied upon by the Assessing Officer. A bench of Judicial Member Madhumita Roy and Accountant Member Kriwant Sahay allowed the Revenue's appeal and dismissed the assessee's cross-objection.
ITAT Delhi Quashes Reassessment Based Solely On Investigation Wing Report
Case Title : V & S International Pvt. Ltd. v. DCIT
Case Number : ITA No. 5782/Del/2024 (AY 2005-06)
CITATION : 2026 LLBiz ITAT(DEL) 225
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has recently quashed reassessment proceedings against V & S International Pvt. Ltd., a readymade garments manufacturer and exporter. It held that the Assessing Officer reopened the completed assessment solely on information received from the Investigation Wing, without independently examining the material. The tribunal observed that the absence of a "live link" between the information and the reasons recorded made the reopening unsustainable. A bench of Judicial Member Satbeer Singh Godara and Accountant Member Naveen Chandra held that the Assessing Officer had not undertaken any independent verification before issuing the reassessment notice.
Interest On Unspent Government Grants Cannot Be Treated As Separate Income: ITAT Chandigarh
Case Title : Hydro Engineering College Society v. Income Tax Officer, Ward, Bilaspur (H.P.)
Case Number : ITA No. 1183/CHANDI/2025
CITATION : 2026 LLBiz ITAT(CHANDI) 226
The Income Tax Appellate Tribunal (ITAT) has recently held that interest earned on unspent government grants parked in fixed deposits retains the same character as the grants themselves. It cannot be treated as an independent source of income while determining whether an educational institution is substantially financed by the government. A Chandigarh tribunal comprising Judicial Member Laliet Kumar and Accountant Member Manoj Kumar Aggarwal allowed the appeal filed by Hydro Engineering College Society.
ITAT Delhi Allows Paper Company's Appeal In Captive Power Transfer Pricing Dispute
Case Title : M/s K.R. Pulp & Papers Ltd. v. ACIT, Central Circle-19, Delhi
Case Number : ITA No. 5741/Del/2024
CITATION : 2026 LLBiz ITAT(DEL) 227
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has allowed an appeal filed by K.R. Pulp & Papers Ltd. against transfer pricing adjustments that had denied the company a tax deduction on profits earned from transferring electricity and steam from its captive power plant to its manufacturing unit. The tribunal held that electricity generated by the company's eligible captive power unit and supplied to its non-eligible manufacturing unit should be valued at the tariff charged by the State electricity distribution company to industrial consumers.
FAR Analysis Mandatory For TP Comparables, Mere “Functional Comparability” Insufficient: ITAT Delhi
Case Title : A. Hartrodt India Private Limited v. DCIT
Case Number : ITA No. 5823/Del/2024
CITATION : 2026 LLBiz ITAT(DEL) 229
On 3 July, the Delhi Bench of the Income Tax Appellate Tribunal (ITAT) held that in transfer pricing analysis, a company cannot be included as a comparable merely on the basis of a general assertion that it is “functionally comparable”, and that a proper Functions, Assets and Risks (FAR) analysis is mandatory before inclusion. Accountant Member Ramit Kochar and Judicial Member Raj Kumar Chauhan partly allowed an appeal by A. Hartrodt India Private Limited for statistical purposes and restored the matter to the Dispute Resolution Panel (DRP) for fresh adjudication.
Case Title : ACIT v. Bonlon Industries Ltd.
Case Number : ITA Nos. 7987, 7988 & 7989/Del/2025 with CO Nos. 5, 6 & 7/Del/2026
CITATION : 2026 LLBiz ITAT(DEL) 228
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has upheld the deletion of a ₹9.16 crore addition over alleged bogus purchases after finding that the taxpayer had produced extensive documentary evidence to support the transactions, despite the Revenue relying, among other things, on the retrospective cancellation of the supplier's GST registration. The tribunal also noted that the Assessing Officer had accepted the corresponding sales and had not rejected the books of account before making an ad hoc addition of 12.5% of the purchases.
ITAT Delhi Deletes ₹15 Crore Share Premium Addition, Says AO Cannot Reject Company's DCF Valuation
Case Title : MI Industries (India) Pvt. Ltd. v. DCIT-16(1), New Delhi
Case Number : ITA No. 7051/Del/2025
CITATION : 2026 LLBiz ITAT(DEL) 230
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) has recently held that an Assessing Officer cannot reject a company's chosen Discounted Cash Flow (DCF) method for valuing shares merely because its actual financial performance differs from projections. Allowing MI Industries (India) Pvt. Ltd.'s appeal in part, the tribunal observed, “We are therefore of the considered view that rejection of DCF method adopted by the assessee by the AO is unwarranted and against the law.”
ITAT Ahmedabad Holds Shell Company Allegation Alone Cannot Justify ₹44.49 Crore Section 68 Addition
Case Title : DCIT v. Jas Infra Space Pvt. Ltd.
Case Number : ITA No. 2070/Ahd/2024
CITATION : 2026 LLBiz ITAT(AHM) 231
The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) on 6 July held that the Income Tax Department cannot treat loans received by a company as unexplained cash credits merely on the basis of allegations that the lender companies are shell entities, when the taxpayer has furnished evidence establishing their identity, financial capacity and genuineness of the transactions. Judicial Member Sanjay Garg and Accountant Member Narendra Prasad Sinha upheld the order of the Commissioner of Income Tax (Appeals) [CIT(A)] deleting additions made against Jas Infra Space Pvt. Ltd. under Section 68 of the Income Tax Act (which deals with unexplained cash credits), except for a limited issue concerning interest payments of Rs.12.15 lakh.
Revenue Cannot Disallow Purchases As Bogus After Accepting Corresponding Sales: ITAT Ahmedabad
Case Title : Gopallal Mathurdas Vaishnav v. ITO
Case Number : ITA Nos. 733/Ahd/2026 and 728/Ahd/2026
CITATION : 2026 LLBiz ITAT(AHM) 232
The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) has recently quashed the reopening of an assessment and deleted an addition of ₹22.47 crore made against a trader in copper scrap and ingots, holding that the Revenue failed to establish that the purchases were bogus despite accepting the corresponding sales. A tribunal comprising Judicial Member Sanjay Garg and Accountant Member Annapurna Gupta observed: "If the assessee has made the sales, it is obvious that he has also made the purchases. It is also not the case of the AO that the assessee had made the purchases in question from some other party or from grey market.The impugned order of the AO and the appellate order of the CIT(A) are not based on any reasonable findings given after appreciation of the evidences furnished by the assessee. Therefore, the impugned additions made/confirmed by the lower authorities are not sustainable, the same are accordingly, ordered to be deleted."
ITAT New Delhi Quashes NIIT Revision, Says Action Was Triggered By Higher Authorities' 'Pressures'
Case Title : NIIT Ltd. v. Commissioner of Income Tax (Central-II), New Delhi (with connected matters)
Case Number : ITA Nos. 2058 to 2063/Del/2010 and ITA No. 4096/Del/2009
CITATION : 2026 LLBiz ITAT(DEL) 233
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 8 July held that revision proceedings under Section 263 of the Income Tax Act cannot be sustained when the Commissioner of Income Tax acts under the pressure of higher authorities instead of independently applying his mind. Judicial Member Satbeer Singh Godara and Accountant Member M. Balaganesh partly allowed NIIT Ltd.'s appeals for Assessment Years 2000-01 to 2005-06 and quashed the revision proceedings initiated against the company. The Bench also dismissed the Revenue's appeal for Assessment Year 2002-03, noting: “We have no hesitation to conclude that the entire revision proceedings under section 263 of the Act had been triggered only based on the dictates / pressures from the higher authorities and not based on any independent application of mind by the Learned CIT in the manner known to law.”
ITAT Delhi Deletes ₹13.97 Crore TP Adjustment Against Coca-Cola India Over Delayed Receivables
Case Title : DCIT, International Taxation v. Coca Cola India Inc.
Case Number : ITA No. 8275/Del/2018 with CO No. 73/Del/2020
CITATION : 2026 LLBiz ITAT(DEL) 235
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has recently held that Coca Cola India Inc.'s Indian branch cannot be subjected to a transfer pricing adjustment over delayed recovery of receivables from its Associated Enterprises (AEs) where it had no borrowings and its working capital requirements were entirely funded by its US head office. A bench of Judicial Member Vimal Kumar and Accountant Member S. Rifaur Rahman partly allowed the Revenue's appeal only on the issue of interest under the Income Tax Act.
Section 263 Assessment Cannot Survive After Original Order Is Quashed As Time Barred: ITAT Kolkata
Case Title : JCIT (In-Situ), Circle-1(1), Kolkata v. Dozco India Private Limited and Cross Objection
Case Number : ITA No. 1018/KOL/2026 and C.O. No. 37/KOL/2026
CITATION : 2026 LLBiz ITAT(KOL) 234
On 8 July, the Kolkata Bench of the Income Tax Appellate Tribunal (ITAT) held that a fresh assessment order passed pursuant to revision proceedings cannot survive once the original assessment has been quashed as time barred. It becomes “invalid and void ab initio” since the original assessment no longer exists in law. Judicial Member Pradip Kumar Choubey and Accountant Member Rajesh Kumar allowed the cross objection filed by Dozco India Private Limited and dismissed the Revenue's appeal as infructuous.
Case Title : OPC Asset Solutions Pvt. Ltd. v. The Joint Commissioner of Income-tax (OSD)
Case Number : ITA No. 2230/Chny/2026
CITATION : 2026 LLBiz ITAT(CHE) 236
The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) on 6 July held that discounting charges arising from the assignment of future rent receivables on a non-recourse basis cannot be treated as interest under the Income-tax Act, 1961, and therefore do not attract tax deduction at source (TDS) under Section 194A (which requires deduction of tax on interest other than interest on securities). A Single Member Bench comprising Judicial Member R. Muralidhar allowed seven appeals filed by OPC Asset Solutions Pvt. Ltd. and set aside the orders passed by the Assessing Officer and the Commissioner of Income Tax (Appeals), which had treated the discount retained by financiers as interest liable for TDS deduction.
AO Cannot Grant Fresh Opportunity To Extend Reassessment Notice Deadline: ITAT Ahmedabad
Case Title : Scarlet Tradelink Private Limited v. Income Tax Officer, Ward 4(1)(1), Ahmedabad
Case Number : ITA No. 869/AHD/2025
CITATION : 2026 LLBiz ITAT(AHM) 237
The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) on 7 July held that a reassessment notice issued after the expiry of the prescribed “surviving period” under the Income Tax Act, 1961 is barred by limitation. Economics Vice President Dr. B.R.R. Kumar and Judicial Member Rahul Chaudhary allowed the appeal filed by Scarlet Tradelink Private Limited against the order of the National Faceless Appeal Centre for Assessment Year 2016-17 and quashed the reassessment proceedings.
ITAT Ahmedabad Upholds Rejection Of Tax Deduction Claim On ₹12 Lakh Donation To Political Party
Case Title : Prasana Jayantkumar Bhatt v. Dy. Commissioner of Income-tax
Case Number : ITA No. 426/Ahd/2026
CITATION : 2026 LLBiz ITAT(AHM) 238
The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) has upheld the denial of a tax deduction claimed by a salaried taxpayer on a ₹12 lakh donation made to a political party, holding that he failed to establish that the contribution was genuine and eligible for deduction. A division bench of Vice-President Dr. B.R.R. Kumar and Judicial Member Rahul Chaudhary observed, "the assessee has failed to establish that the impugned contribution represented a genuine donation eligible for deduction under section 80GGC of the Act."
ITAT Delhi Quashes Reassessment After AO Failed To Decide Objections Before Proceeding
Case Title : Meramandali Finvest Ltd. v. Income Tax Officer, Ward-17(1), New Delhi
Case Number : ITA No. 7258/Del/2025
CITATION : 2026 LLBiz ITAT(DEL) 239
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has recently quashed a reassessment against Meramandali Finvest Ltd., holding that the Assessing Officer was required to dispose of the assessee's objections to the reopening by passing a separate speaking order before proceeding with the reassessment. A bench of Judicial Member Satbeer Singh Godara and Accountant Member Naveen Chandra observed: "It is now settled law by a series of judicial precedents that the failure of the Assessing Officer to dispose of objections filed by the assessee against the reopening notice by passing a speaking order, becomes fatal to the assumption of jurisdiction under Section 147 and renders any reassessment order passed thereafter null and void."
ITAT Chennai Upholds Deletion Of Unexplained Money Addition Against Forex Commission Agent
Case Title : The Income Tax Officer v. Shri Jaisingh Shankar
Case Number : ITA No.: 2931/CHNY/2025
CITATION : 2026 LLBiz ITAT(CHE) 240
The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) has upheld the deletion of an addition of ₹3.44 crore made against an individual who worked as a commission agent for foreign exchange companies. It held that cash withdrawn from the agent's own bank account for disbursal to customers could not be treated as unexplained money under Section 69A of the Income Tax Act, which addresses unexplained assets. The case involved an individual who acted as an authorised sub-agent for Transcorp International Ltd. and Muthoot Forex Ltd.
Late Corrigendum To Final Assessment Order Cannot Cure Failure To Follow DRP Directions: ITAT Delhi
Case Title : Syniverse Technologies Services India Pvt. Ltd. v. ACIT, Circle 3(1), Gurgaon
Case Number : ITA No. 2056/Del/2022
CITATION : 2026 LLBiz ITAT(DEL) 241
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has quashed an assessment order passed against an Indian subsidiary of a foreign technology company. The tribunal held that the Assessing Officer could not rectify the failure to give effect to the Dispute Resolution Panel's (DRP) directions by issuing a corrigendum after the statutory time limit had expired. A bench of Judicial Member Raj Kumar Chauhan and Accountant Member S. Rifaur Rahman observed that the final assessment order, passed without incorporating the DRP's directions, was unsustainable.
Case Title : National Lubricating Grease Institute India Chapter v. CIT (Exemption), Chandigarh
Case Number : ITA No. 8271/Del/2025
CITATION : 2026 LLBiz ITAT(DEL) 242
The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 10 July held that an institution does not lose its charitable character merely because its activities benefit a specific industry, and set aside the Commissioner (Exemptions)'s order rejecting registration of the National Lubricating Grease Institute India Chapter under Sections 12AA/12AB of the Income Tax Act. A Bench comprising Accountant Member S. Rifaur Rahman and Judicial Member Vimal Kumar held: “Only because of specific group of participants of lubricating grease industry are directly benefitted cannot be a ground to question the charitable nature of a Society.”
Case Title : KBC Bank Naamloze Vennootschap v. Assistant Commissioner of Income Tax, International Tax Circle 3(1)(2), Mumbai
Case Number : ITA No. 8160/Mum/2025
CITATION : 2026 LLBiz ITAT(MUM) 243
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has remanded to the Assessing Officer (AO) the issue of taxability of a ₹3.14 crore write-back of general provision for standard assets, observing that if the assessee had already accounted for the amount in its profit and loss account and neutralised its effect while computing taxable income, it could not be brought to tax again. A bench of Judicial Member Beena Pillai and Accountant Member Arun Khodpia partly allowed the appeal filed by KBC Bank Naamloze Vennootschap for statistical purposes.
Carbon Credit Sale Receipts Are Capital Gains, Not Taxable Before AY 2017-18 : ITAT New Delhi
Case Title : Jindal Saw Ltd. (formerly Saw Pipes Ltd.) v. Deputy Commissioner of Income Tax
Case Number : ITA Nos. 2383 & 2384/Del/2018, 2747 & 2748/Del/2018 and 463/Del/2019
CITATION : 2026 LLBiz ITAT(DEL) 244
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 13 July held that receipts from the sale of carbon credits are capital receipts and are not taxable for Assessment Years 2012-13 and 2013-14. Judicial Member Satbeer Singh Godara and Accountant Member Manish Agarwal dismissed the Revenue's appeals and partly allowed the appeals filed by Jindal Saw Ltd. (formerly known as Saw Pipes Ltd.). The Bench observed: “We conclude in this factual backdrop that the assessee's impugned identical receipt(s) derived from sale/transfer of carbon credits is not taxable being capital in nature which also deserve to be excluded for section 115JB MAT computation in very terms.”
Case Title : DCIT (International Taxation)-4(2)(2) v. Standard Chartered Bank & Standard Chartered Bank v. DCIT (International Taxation)-4(2)(2)
Case Number : ITA Nos. 4247 & 4275/Mum/2025 and ITA Nos. 4264 & 4265/Mum/2025
CITATION : 2026 LLBiz ITAT(MUM) 245
Salary paid by the head office of a foreign bank to expatriate employees working exclusively for its Indian operations cannot be treated as head office expenditure merely because the payment was initially made outside India, the Mumbai Income Tax Appellate Tribunal (ITAT) has held. A bench of Judicial Member Beena Pillai and Accountant Member Arun Khodpia dismissed the Revenue's appeal. It upheld the Commissioner (Appeals)' order allowing Standard Chartered Bank's claim for deduction of expatriate salary expenditure.
Case Title : SFDC Ireland Ltd. v. Deputy Commissioner of Income Tax
Case Number : ITA No. 2137/Del/2023
CITATION : 2026 LLBiz ITAT(DEL) 246
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 17 July held that receipts from automated software services cannot be treated as Fees for Technical Services (FTS) under the India-Ireland Double Taxation Avoidance Agreement (DTAA) without first examining whether the services involve the requisite human intervention and possess the characteristics of specialised technical services. Judicial Member Vikas Awasthy and Accountant Member Brajesh Kumar Singh allowed an appeal filed by SFDC Ireland Ltd., and remanded the matter to the Assessing Officer for fresh adjudication for failing to examine the issue in light of the Supreme Court's decision in Kotak Securities Ltd., which distinguishes technical services from a mere facility.
ITAT Delhi Remands Partnership Firm's Reassessment, Faults Authorities' Cryptic Orders
Case Title : Accurate Pressings v. ITO
Case Number : ITA No. 5875/Del/2025
CITATION : 2026 LLBiz ITAT(DEL) 247
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has remanded a reassessment involving a partnership firm's write-back of a retired partner's capital balance after finding that the tax authorities passed cryptic orders without specifying the provision under which the amount was chargeable to tax. A coram of Judicial Member Yogesh Kumar US and Accountant Member Ramit Kochar partly allowed the appeal for statistical purposes. While upholding the reopening of the assessment, it restored the matter to the Assessing Officer (AO) for a fresh examination of the addition on merits.
ITAT Delhi Deletes ₹5.19 Crore AMP Adjustment Against Fujifilm India Following Sony Ericsson Ruling
Case Title : Fujifilm India Private Limited v. Assessing Officer
Case Number : ITA No. 3446/Del/2024
CITATION : 2026 LLBiz ITAT(DEL) 248
The Delhi Income Tax Appellate Tribunal (ITAT) on 20 July held that a transfer pricing adjustment for Advertising, Marketing and Promotion (AMP) expenditure cannot be sustained when it is computed by applying the Bright Line Test (BLT), following the Delhi High Court's ruling in Sony Ericsson Mobile Communications India Pvt. Ltd. A Bench of Accountant Member Ramit Kochar and Judicial Member Sudhir Kumar partly allowed the appeal filed by Fujifilm India Pvt. Ltd. and deleted the Rs. 5.19 crore transfer pricing adjustment made by the authorities. It clarified that the parties would remain bound by the outcome of the Revenue's pending Special Leave Petition before the Supreme Court against the Sony Ericsson judgment.
ITAT Mumbai Grants LTCG Relief To Taxpayer, Rejects Revenue's Claim That Scrip Was Penny Stock
Case Title : Shripal Roopchand Jain v. Income Tax Officer, Ward 31(3)(4), Mumbai
Case Number : ITA No. 5560/MUM/2025
CITATION : 2026 LLBiz ITAT(MUM)
The Mumbai Income Tax Appellate Tribunal (ITAT) has allowed an individual taxpayer's claim for exemption on long-term capital gains arising from the sale of shares after finding that the transactions were genuine and supported by documentary evidence. It observed that there was nothing on record to establish that the company whose shares were sold was a penny stock. The tribunal also found no material linking the assessee to any alleged accommodation entry operators. Judicial Member Sandeep Gosain observed that the revenue had not produced material to show that Shree Shaleen Textile Limited was a penny stock company.
Charitable Trust Registration Can't Be Denied Over Expenditure Concerns Alone: ITAT Delhi
Case Title : Visan Foundation v. Commissioner of Income Tax (Exemptions), Faridabad
Case Number : ITA No. 3604/Del/2026
CITATION : 2026 LLBiz ITAT(DEL) 250
The Income Tax Appellate Tribunal (ITAT), Delhi, has recently directed the Commissioner of Income Tax (Exemptions) to grant charitable trust registration to Visan Foundation. It held that registration cannot be denied merely over concerns regarding expenditure without first examining whether the trust's objects are charitable and its activities are genuine. A coram of Judicial Member Kavitha Rajagopal and Accountant Member M. Balaganesh observed, "We do not find any discussion as to the objects of the Trust, neither as to the genuineness of its activities. Rather, it was with regard to the expenditure claimed by the assessee towards food, rent, and training expenses, more specifically with regard to the food expenses incurred by the assessee. This, in our view, is not justifiable reasoning for denial of registration."
Case Title : Maersk India Private Limited v. Joint Commissioner of Income Tax, Central Circle-4(3), Mumbai
Case Number : ITA No. 5856/MUM/2025 (Assessment Year: 2022-23)
CITATION : 2026 LLBiz ITAT(MUM) 251
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) on 1 July held that the nomenclature given to a payment in the books of account cannot determine the true nature of a transaction and that tax deduction at source (TDS) provisions do not apply where a payment is only reimbursement of expenditure without any income element in the hands of the recipient. A Bench comprising Judicial Member Siddhartha Nautiyal and Accountant Member Vikram Singh Yadav allowed an appeal filed by Maersk India Private Limited against the disallowance made under Section 40(a)(ia) of the Income Tax Act (which disallows certain expenses where tax was required to be deducted but was not deducted).
Case Title : Chanel (India) Private Limited v. DCIT
Case Number : ITA No. 2341/Del/2022
CITATION : 2026 LLBiz ITAT(DEL) 252
The Income Tax Appellate Tribunal (ITAT) Delhi has recently granted relief to luxury fashion brand Chanel's Indian arm, quashing reassessment proceedings initiated against Chanel (India) Private Limited beyond four years. It also deleted a ₹3.08 crore transfer pricing adjustment. It also deleted a ₹3.08 crore transfer pricing adjustment. The tribunal held that the subsidy received from its associated enterprise formed part of the company's operating income because it directly compensated its unabsorbed distribution costs.
Case Title : Ram Dattatray Kaldate v. Income Tax Officer, Ward-1(1), Aurangabad
Case Number : ITA No. 2177/PUN/2025
CITATION : 2026 LLBiz ITAT(PUN) 253
The Pune Bench of the Income Tax Appellate Tribunal (ITAT) has held that the ex gratia amount received by an employee under Pfizer Healthcare India Pvt. Ltd.'s voluntary retirement scheme is a capital receipt and cannot be taxed as income from other sources. Observing that it had consistently taken the same view in identical cases involving other employees of the company, the bench ruled, "We find that the identical issue had come up before the tribunal in the case of other employees of M/s. Pfizer Healthcare India Pvt. Ltd. and the tribunal has consistently decided the impugned issue in favour of the assessee holding that the impugned amount received by the assessee under the Scheme is a capital receipt not chargeable to tax in the hands of the assessee."
Case Title : Sudhir Agrawal v. Deputy Commissioner of Income Tax
Case Number : ITA Nos. 3823 to 3830/Del/2026
CITATION : 2026 LLBiz ITAT(DEL) 254
The New Delhi Income Tax Appellate Tribunal (ITAT) on 29 July held that where the Assessing Officer of the searched person and the “other person” under Section 153C of the Income Tax Act is the same, the limitation period for completing assessment begins from the date of transfer of jurisdiction under Section 127 and not from the date of recording satisfaction. A Bench of Judicial Member Vimal Kumar and Accountant Member Manish Agarwal quashed the assessment orders passed against Sudhir Agrawal for Assessment Years 2013-14 to 2020-21, holding that the orders passed on 30 March 2023 were barred by limitation as the transfer order under Section 127 was passed on 20 October 2020.
Disseminating Bhagavad Gita Teachings Can't Be Treated As Religious Propagation: ITAT Chandigarh
Case Title : World Sankirtan Tour Trust v. CIT (Exemptions), Chandigarh
Case Number : ITA Nos. 1462 & 1463/CHD/2025
CITATION : 2026 LLBiz ITAT(CHA) 255
The Income Tax Appellate Tribunal (ITAT), Chandigarh has recently held that dissemination of the philosophical teachings of the Bhagavad Gita cannot, by itself, be equated with the propagation of religion or the advancement of a particular religious denomination. Therefore, the tribunal held that World Sankirtan Tour Trust was a charitable institution, not a religious entity, and was entitled to tax benefits because its dominant objects and actual activities were charitable in nature.
Case Title : Unicharm India Private Limited v. Deputy Commissioner of Income Tax
Case Number : ITA Nos. 5938/Del/2018, 6088/Del/2018, 6104/Del/2018, 6203/Del/2018 & 7414/Del/2019
CITATION : 2026 LLBiz ITAT(DEL) 256
On 30 July, the New Delhi Income Tax Appellate Tribunal (ITAT) held that AMP expenditure incurred by an Indian entity cannot be treated as an international transaction for transfer pricing purposes without any agreement, arrangement or understanding with its associated enterprise (AE), following the Delhi High Court's ruling in Sony India Pvt. Ltd. v. ACIT. A Bench comprising Judicial Member Satbeer Singh Godara and Accountant Member Manish Agarwal held that the issue of whether AMP expenditure constitutes an international transaction has been settled against the Revenue by decision in Sony India Pvt. Ltd. and deleted the transfer pricing adjustment made against Unicharm India Private Limited.
HCL's Corporate Guarantees For Overseas Subsidiaries Attract Transfer Pricing Provisions: Delhi ITAT
Case Title : HCL Technologies Ltd. v. Deputy Commissioner of Income Tax
Case Number : ITA Nos. 1842/Del/2014, 2327/Del/2015 & 1645/Del/2016
CITATION : 2026 LLBiz ITAT(DEL) 257
The Delhi Bench of the Income Tax Appellate Tribunal has held that corporate guarantees issued by HCL Technologies Ltd. to its step-down overseas subsidiaries amount to indirect financing and therefore qualify as international transactions requiring transfer pricing benchmarking. Rejecting the Transfer Pricing Officer's reliance on commercial bank guarantee rates with an additional 200-basis-point mark-up, the tribunal held that an arm's length guarantee commission of 0.50% was appropriate.
Other Developments
CBDT Notifies No TDS on Specified Payments to Eligible IFSC Units Under Income-tax Act, 2025
The Central Board of Direct Taxes (CBDT) has exempted specified payments made to eligible units operating in an International Financial Services Centre (IFSC) from tax deduction at source (TDS), provided the units have opted to claim deductions under the Income-tax Act, 2025. The exemption is available only for the categories of payments notified by the government and is subject to prescribed conditions.
Centre Notifies Oman's Social Protection Fund For Tax Exemption On Eligible Investments In India
The central government has notified Oman's Social Protection Fund (SPF) as a specified person eligible to claim tax exemption on qualifying investments made in India under the Income Tax Act, 2025. This will apply to eligible investments made from the date of publication of the notification in the Official Gazette until March 31, 2030, subject to prescribed conditions. The notification, issued by the Central Board of Direct Taxes (CBDT), requires the fund to file income tax returns within the prescribed timelines along with a compliance certificate from an accountant. It must also disclose details of its investments in India every quarter.