LiveLawBiz Direct Tax Weekly Round-Up: April 20 - April 26, 2026
Kapil Dhyani
27 April 2026 2:48 PM IST
HIGH COURTS
Bombay HC
Case Title : Mahaveer Pratishthan Vs The Commissioner of Exemption, Pune & Anr
Case Number : WRIT PETITION NO. 8536 OF 2024
CITATION : 2026 LLBiz HC(BOM) 228
The Bombay High Court has set aside an order rejecting a charitable trust's request to excuse a delay in filing Form 10, holding that a lapse on the part of its Chartered Accountant could not be used to deny the trust tax exemption under Section 11 of the Income Tax Act. A Bench of Justice B.P. Colabawalla and Justice Firdosh P. Pooniwalla said, “the Petitioner Trust would suffer grave hardship if the delay is not condoned since the Petitioner Firm would be saddled with a huge tax liability for merely not filing Form 10 within time. The Petitioner-Trust, ought not to be foisted with such hardship because of the failure of the Petitioner's Chartered Accountant to fulfill the Petitioner Trust's compliance owing to reasons explained in the Chartered Accountant's Affidavit dated 24th March 2023. The Petitioner does not seem to gain any benefit from such a delay in filing its Form 10”.
Case Title : Rika Global Impex Limited Vs Union Of India And Ors
Case Number : WRIT PETITION NO. 2310 OF 2024
CITATION : 2026 LLBiz HC(BOM) 226
The Bombay High Court has recently flagged a persistent issue of the tax and customs department taking inconsistent stands on the same legal question before different High Courts, warning that such conduct leads to “judicial chaos” and needs correction through a uniform litigation policy. A bench of Justice G. S. Kulkarni and Justice Aarti Sathe held that once a legal issue has reached finality against the department, it cannot be reopened elsewhere by taking a contrary stand.
Delhi HC
Case Title : Supreme Build-Cap Pvt. Ltd. v. Assistant Commissioner Of Income Tax, Central Circle (5), Delhi
Case Number : W.P.(C) 4543/2026
CITATION : 2026 LLBiz HC (DEL) 392
The Delhi High Court has held that a writ petition under Article 226 is maintainable even after completion of assessment proceedings, where the impugned action is ex facie without jurisdiction. A Division Bench of Justices Dinesh Mehta and Vinod Kumar observed that “simply because the proceedings have culminated into an assessment order, the petitioner cannot be made to suffer the agony of an order which is without jurisdiction on the face of it, until the appellate authority does a formal act of annulling it.”
Taxpayer Liable Only For Own Investment Share, Not Spouse's Contribution: Delhi High Court
Case Title : Puneet Kanodia v. National Faceless Assessment Centre New Delhi & Anr.
Case Number : W.P.(C) 4327/2026
CITATION : 2026 LLBiz HC (DEL) 405
The Delhi High Court on 17 April 2026 held that a taxpayer can only be required to explain his own share of investment and cannot be saddled with tax liability for the contribution of a co-owner, including a spouse, where joint ownership and independent sources of funds are evident. A Division Bench of Justice Dinesh Mehta and Justice Vinod Kumar set aside the assessment order passed under Sections 143(3) read with 144B of the Income Tax Act, 1961, and remanded the matter for reconsideration, in a case where an addition of Rs. 2.85 crore had been made under Section 69C of the Income Tax Act.
Delhi High Court Refuses To Quash Third-Party Reassessment Despite Interim Relief To Searched Entity
Case Title : Hari Bhoomi Communications Private Limited v. Assistant Commissioner of Income Tax Circle 10(1) & Ors.
Case Number : W.P.(C) 3703/2026
CITATION : 2026 LLBiz HC (DEL) 412
The Delhi High Court has dismissed a writ petition filed by Hari Bhoomi Communications Private Limited, holding that reassessment proceedings initiated against it on the basis of material recovered during a search at another entity's premises are not rendered void by a subsequent interim order passed in favour of the searched entity. A division bench of Justice Dinesh Mehta and Justice Vinod Kumar refused to interfere with an assessment order dated March 25, 2026, passed against the company pursuant to a notice issued on March 31, 2025 under the second explanation to Section 148 of the Income Tax Act. The notice had been triggered by material recovered during a search conducted at the premises of Kuantum Papers Limited.
Failure To Claim Tax Relief Doesn't Change Nature Of Salary Arrears: Delhi High Court
Case Title : Vishwajeet Souryan v. UoI
Case Number : W.P.(C) 134/2026
CITATION : 2026 LLBiz HC (DEL) 416
The Delhi High Court has clarified that the non-claim of relief under Section 89 of the Income Tax Act, 1961 does not determine the nature of income and cannot be taken to mean that such income is not arrears. A division bench of Justices Anil Kshetarpal and Amit Mahajan was dealing with a petition challenging an order of the Central Administrative Tribunal (CAT), which had closed contempt proceedings arising from a dispute over EWS-based IAS allocation.
Gujarat HC
Gujarat High Court Quashes Move To Reopen Income Tax Assessment Over Vague Third-Party Material
Case Title : Bhavnaben Darshanbhai Patel v. Income Tax Officer
Case Number : R/SPECIAL CIVIL APPLICATION NO. 780 of 2026
CITATION : 2026 LLBiz HC(GUJ) 54
The Gujarat High Court has quashed reassessment notices against a taxpayer, ruling that the Income Tax Department cannot reopen completed assessments based on vague third-party documents that have no clear link to the person concerned. The ruling was delivered by a Division Bench comprising Justice A. S. Supehia and Justice Pranav Trivedi in a batch of petitions led by Bhavnaben Darshanbhai Patel, challenging reassessment proceedings for Assessment Year 2020–21.
Case Title : Raivat Kalpeshbhai Shah v. Income Tax Officer
Case Number : R/SPECIAL CIVIL APPLICATION NO. 3868 of 2026
CITATION : 2026 LLBiz HC(GUJ) 55
The Gujarat High Court has set aside a tax reassessment notice issued in a land sale case, holding that the Income Tax Department cannot rely on the same evidence to take opposite positions against the buyer and the seller. The Division Bench comprising Justice A.S. Supehia and Justice Pranav Trivedi was dealing with a writ petition challenging a notice issued under Section 148 of the Income Tax Act for Assessment Year 2020–21.
Case Title : Commissioner of Income Tax Gandhinagar v. Gujarat State Energy Generation Ltd.
Case Number : R/TAX APPEAL NO. 1973 of 2009
CITATION : 2026 LLBiz HC(GUJ) 57
The Gujarat High Court on 9 April, held that a taxpayer can file a revised return under Section 139(5) of the Income Tax Act, 1961 only when it discovers a bona fide omission or wrong statement in the original return filed under Section 139(1). The provision cannot be used to make deliberate or afterthought changes. The Bench of Justices A.S. Supehia and Pranav Trivedi emphasised that a valid revised return replaces the original return for all purposes under the Act, but only when it reflects genuine correction of errors and not a strategic revision of claims.
Jammu & Kashmir & Ladakh HC
Case Title : Pr. Commissioner of Income Tax v. Kamraz Rural Bank
Case Number : ITA 2/2018
CITATION : 2026 LLBiz HC (JAM) 13
The Jammu and Kashmir and Ladakh High Court has recently held that an appellate authority under the Income Tax law cannot allow a taxpayer to file fresh evidence at the appeal stage without first passing a reasoned order and giving the tax officer a fair chance to respond. A bench of Justice Sanjeev Kumar and Justice Sanjay Parihar said, “We are also of the clear view that the opportunity to lead additional evidence at the appellate stage could not be granted by the First Appellate Authority under the Act without passing a speaking order indicating clearly that the conditions laid down in Clause 1 of Rule 46A are met."
Karnataka HC
Search Under IT Act Is Person-Centric; Premises Don't Decide 'Searched Person': Karnataka High Court
Case Title : The Deputy Commissioner of Income Tax v. Sri C.R. Ram Mohan Raju
Case Number : WRIT APPEAL No. 382 OF 2026 (T-IT)
CITATION : 2026 LLBiz HC(KAR) 55
Holding that a “searched person” under the Income Tax Act is determined by the person against whom statutory satisfaction is recorded and not by whose premises are searched, the Karnataka High Court on Friday ruled that a taxpayer cannot be treated as a searched person merely because a search was conducted at his premises. The ruling came in a case where the tax department initiated proceedings against the taxpayer under Section 153C based on documents seized during a search conducted at his premises.
Madras HC
Case Title : M/s Kerala Roadways (P) Ltd. v. The Deputy Commissioner of Income Tax
Case Number : Tax Case ( Appeal ) Nos.373 of 2009
CITATION : 2026 LLBiz HC (MAD) 106
The Madras High Court on 7 April, held that a return filed after the initiation of search proceedings and beyond the due date cannot qualify as a valid disclosure to exclude such income from undisclosed income in block assessment under the Income Tax Act. A Division Bench of Justices G. Jayachandran and R. Sakthivel rejected the Kerala Roadways appeal. It partly accepted one of the Revenue's appeals and fully accepted another, while deciding issues on block assessment, revisional powers, and undisclosed income.
Telangana HC
Case Title : The Commissioner of Income Tax(TDS), Hyderabad v. M/s Jaypeem Granites (P) Ltd.
Case Number : ITTA.No.421 of 2013
CITATION : 2026 LLBiz HC(TEL) 20
The Telangana High Court has upheld an Income Tax Appellate Tribunal (ITAT) order that corrected its own contradictory ruling after it had simultaneously allowed both the assessee's and the Revenue's appeals on the very same issue. Holding that such an outcome was inherently inconsistent, a bench of Justice P. Sam Koshy and Justice Suddala Chalapathi Rao observed the tribunal was justified in stepping in to resolve the contradiction, especially when it had already decided the issue on merits in favour of the assessee.
ITAT
Case Title : Reliance Jio Infocomm USA Inc. v. DCIT (International Tax), Mumbai
Case Number : ITA No. 2991/Mum/2023
CITATION : 2026 LLBiz ITAT(MUM) 100
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has ruled that Rs. 23.20 crore received by Reliance Jio Infocomm USA Inc. for providing voice termination services to Reliance Jio Infocomm Ltd. cannot be treated as royalty or fees for technical services (FTS) under Indian tax law or the India–US tax treaty. It said the income is in the nature of business profits and therefore not taxable in India. The decision was delivered by Judicial Member Beena Pillai and Accountant Member Bijayananda Pruseth. The tax department had argued that the payments amounted to “process royalty," pointing to the use of telecom infrastructure, software and network systems. This position had earlier been endorsed by the Dispute Resolution Panel, which viewed the services as falling within the definition of “process”.
ITAT Mumbai Sets Aside CIT(A) Enhancement Of Taxable Income On Issue Not Examined By AO
Case Title : Skyline Greathills v. DCIT
Case Number : ITA Nos. 3466 & 3904/Mum/2025
CITATION : 2026 LLBiz ITAT(101)
The Income Tax Appellate Tribunal (ITAT) at Mumbai has held that the Commissioner of Income Tax (Appeals) cannot enhance an assessment by introducing a fresh issue that was never examined by the Assessing Officer, setting aside an addition made through adjustment of work in progress in the case of Skyline Greathills, a real estate company. A Bench of Vice President Saktijit Dey and Accountant Member Arun Khodpia observed, “Section 251(1) of the Act restricts the CIT(A) to assume jurisdiction for enhancement of income, on an issue or new source of income, which was not dealt with or considered by the AO during the assessment proceedings.”
Delay In Final Approval Filing Not Adverse Where Caused By Confusion In Amended Law: ITAT Ahmedabad
Case Title : Navsarjan Education Trust Metoda Sampran School v. The Dy. CIT Cir-2
Case Number : ITA No(s) 2483/Ahd/2025
CITATION : 2026 LLBiz ITAT(AHM) 102
The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT), has held that delay in filing an application for final approval cannot be held against a taxpayer where such delay arises due to genuine confusion created by newly amended statutory provisions and procedural uncertainty during the transition period. The Bench comprising Judicial Member Sanjay Garg and Accountant Member Annapurna Gupta while dealing with the case of Navsarjan Education Trust, observed that both taxpayers and tax authorities faced genuine difficulty in interpreting the amended regime introduced with effect from 1 April 2021.
Case Title : Mrs. Chandra Swaminathan v. The ITO
Case Number : ITA No.2034/Chny/2025
CITATION : 2026 LLBiz ITAT(CHE) 103
The Income Tax Appellate Tribunal (ITAT) in Chennai has recently deleted additions of Rs.49.80 lakh and Rs.10.80 lakh made against a taxpayer after finding that her investment in a new flat and cash deposits were wrongly treated as unexplained, despite being traceable to the sale of her earlier property and household items. A bench of Judicial Member Aby T. Varkey and Accountant Member S.R. Raghunatha held, “We thus find that the addition made by the AO u/s 69A was without any basis and on incorrect appreciation of relevant facts and that he had misdirected himself on irrelevant material."
Case Title : Vintage Distillers Ltd. v. DCIT
Case Number : ITA Nos.6435 to 6440/Del/2025
CITATION : 2026 LLBiz ITAT(DEL) 104
The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 17 April, held that reassessment proceedings initiated beyond three years are invalid unless the Revenue demonstrates that the alleged escaped income is represented in the form of an “asset” exceeding Rs. 50 lakh, as required under Section 149(1)(b) of the Income-tax Act. A Bench comprising Judicial Member Anubhav Sharma and Accountant Member Manish Agarwal quashed reassessment notices issued under Section 148 in the case of Vintage Distillers Ltd., holding them to be barred by limitation.
ITAT Delhi Upholds Deletion Of ₹10.5 Crore Addition Based On Retracted Statement In Oppo Search Case
Case Title : ACIT Central Circle-30 v. Sanjay Goel
Case Number : ITA No.4500/Del/2025
CITATION : 2026 LLBiz ITAT(DEL) 105
The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 17 April upheld the deletion of a Rs. 10.5 crore addition made solely on the basis of a retracted statement recorded during search proceedings, holding that such statements, in the absence of corroborative evidence, cannot by themselves sustain an addition under the Income-tax Act. A Bench comprising Judicial Member Anubhav Sharma and Accountant Member Manish Agarwal dismissed the Revenue's appeal and affirmed the order of the Commissioner of Income Tax (Appeals), which had deleted the addition in a case arising from a search conducted in the Oppo Mobile India Group.
ITAT Quashes Reassessment Based On Third-Party Statements, Deletes ₹94.5 Lakh Additions
Case Title : Crystal Quinone Pvt. Ltd. v. DCIT
Case Number : ITA No. 1452/Ahd/2025
CITATION : 2026 LLBiz ITAT(AHM) 107
The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) on 7 April 2026 held that reassessment proceedings cannot survive where the Assessing Officer relies solely on general third-party statements without establishing a clear nexus with the taxpayer, as such material fails to show independent application of mind or escapement of income. The Bench comprising Vice-President Dr. B.R.R. Kumar and Judicial Member Suchitra R. Kamble allowed the appeal filed by Crystal Quinone Pvt. Ltd. for assessment year 2009-10 and set aside the reassessment proceedings while deleting additions of Rs. 94.5 lakh.
Debatable Issues Cannot Be Rectified Under Section 154 Of Income Tax Act: ITAT Ahmedabad
Case Title : The Madhavpura Mercantile Co Op Bank Limited v. ACIT
Case Number : ITA No. 2241 & 2242/Ahd/2025
CITATION : 2026 LLBiz ITAT(AHA) 108
The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) on 7 April held that authorities cannot invoke Section 154 of the Income Tax Act, 1961 to rectify debatable issues, as the provision applies only to mistakes apparent from the record. A Bench comprising Judicial Member Suchitra Kamble and Accountant Member Narendra Prasad Sinha quashed the rectification order passed against The Madhavpura Mercantile Co-Operative Bank Ltd (under liquidation). It held, “Any issue which is debatable in nature cannot be subject matter of rectification proceeding u/s. 154 of the Act.”
ITAT Ahmedabad Remands ₹7.71 Crore Addition Over Possible Duplication In Bank Credits
Case Title : Money Assurance Services v. ITO
Case Number : ITA No. 252/AHD/2025
CITATION : 2026 LLBiz ITAT(AHA) 109
The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) on 7 April 2026 held that additions based on bank credits, accommodation entries and interest income must be properly reconciled to avoid duplication while determining taxable income. A Bench comprising Judicial Member TR Senthil Kumar and Accountant Member Narendra Prasad Sinha partly allowed the appeal filed by Money Assurance Services for assessment year 2014–15, observing: “The AO should have excluded the interest income and accommodation entry credited to the HDFC bank account and thereafter considered only the balance amount for making the addition.”
ITAT Ahmedabad Quashes Reassessment As AO Shifts From Bogus Loan To LTCG From Penny Stocks
Case Title : Pinkal Rajeshbhai Patel v. ITO
Case Number : ITA No. 99/Ahd/2025
CITATION : 2026 LLBiz ITAT(AHA) 110
The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) on 7 April 2026 quashed reassessment proceedings against taxpayer Pinkal Rajeshbhai Patel in a case involving alleged bogus loans. A Bench of Vice-President Dr. B.R.R. Kumar and Judicial Member Suchitra R. Kamble held that the Assessing Officer (AO) made the addition on a completely different issue of alleged bogus long-term capital gains from penny stocks.
ITAT Kolkata Remands ₹13.83 Crore Unsecured Loan Case, Flags Lack of Creditor Verification
Case Title : DCIT v. Anushikha Investments Private Limited
Case Number : ITA No. 360/KOL/2025
CITATION : 2026 LLBiz ITAT(KOL) 111
The Kolkata Bench of the Income Tax Appellate Tribunal (ITAT) on 7 April 2026 held that additions under Section 68 cannot be deleted by the CIT(A) without allowing the Assessing Officer to verify the creditors and examine their directors, where the foundational facts regarding identity and genuineness remain untested. A Bench of Judicial Member George Mathan and Accountant Member Rakesh Mishra partly allowed the Revenue's appeal and remanded the matter involving Anushikha Investments Private Limited for assessment year 2016-17.
Case Title : Shri Bhumika Strips Private Limited v. ITO
Case Number : ITA Nos. 1362, 1363 & 1364/Ahd/2025
CITATION : 2026 LLBiz ITAT(AHA) 112
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) has directed the recomputation of additions made by tax authorities against a steel manufacturer after finding that the Assessing Officer treated certain sales as non-genuine primarily on the basis of cancellation of a buyer's VAT registration without verifying when that cancellation took place. “There is no verification by the Assessing Officer about the date of cancellation of the VAT registration by VAT department,” the tribunal recorded, noting that the addition was made based on information received from the investigation wing without proper verification.