Income Tax | S.194C & S.194LA Would Not Apply When TDR Certificates Are Issued In Lieu Of Compensation: Bombay High Court

The Bombay High Court held that Section 194C and Section 194LA of the Income Tax Act would not apply when TDR Certificates are issued in lieu of compensation. Justices B.P. Colabawalla and Firdosh P. Pooniwalla agreed with the assessee that the words “or by any other mode” appearing in Section 194C would have to be read ejusdem generis to the words “payment thereof in cash or by issue of a cheque or draft”. Similarly, in Section 194LA, the words “or by any other mode” would have to...

Income Tax | Sale Proceeds Of One House Used For Purchasing Multiple Residential Houses Qualifies For Exemption U/S 54(1): Bombay High Court

The Bombay High Court held that sale proceeds of one residential house, used for purchase of multiple residential houses, would qualify for exemption under Section 54(1) of the Income Tax Act. The issue before the bench was whether Section 54(1) of the Income Tax Act allows the Assessee to set off the purchase cost of more than one residential units against the capital gains earned from sale of a single residential house. Chief Justice Alok Aradhe and Justice Sandeep V. Marne stated...

Proceedings Can Be Remitted Back To Same Arbitrator U/S 33 & 34(4) Of A&C Act Only Before Passing Of Award: Bombay High Court

The Bombay High Court Division Bench, comprising Chief Justice Alok Aradhe and Justice Sandeep V. Marne, observed that a Section 34 Court can only remit back to the same Arbitration following the procedure for remand u/s 33 and 34(4). The act of the Appellant not issuing a notice u/s 21 of the A&C Act to the Respondent, and approaching the same Arbitration, who initiates Arbitral proceedings, results in the Arbitral Tribunal being devoid of jurisdiction. Factual Matrix: The...

Bombay High Court Directs GST Council To Develop Mechanism For Cross-State ITC Transfer In Mergers/Amalgamations

The Bombay High Court has directed the GST Council and GST Network to develop a mechanism for cross-state ITC transfer in Mergers/amalgamations. Justices Bharati Dangre and Nivedita P. Mehta permitted the IGST and CGST amount lying in the electronic credit ledger of the Transferor Company to be transferred to the Petitioner Company by physical mode for the time being, subject to the adjustments to be made in future. The petitioner/Umicore Autocat India Private Limited has raised a...

Member Of Society Can Be Directed To Vacate Premises U/S 9 Of Arbitration Act For Smooth Redevelopment: Bombay High Court

The Bombay High Court bench of Chief Justice Alok Aradhe and Justice Sandeep V. Marne held that a member of a society can be directed to vacate the premises occupied by them under Section 9 of the Arbitration Act to ensure smooth redevelopment, if they act contrary to the terms of the Development Agreement These Appeals have been filed under Section 37 of the Arbitration and Conciliation Act, 1996 (Arbitration Act) challenging the order dated 20 June 2025 passed by the learned Single...

Direction Of Disclosure Or Attachment Of Assets Cannot Be Passed Against A Person Who Is Not A Party To The Arbitral Award: Bombay HC

The Bombay High Court has held that a foreign arbitral award cannot be enforced against a person who was not a party to the arbitration proceedings. It ruled that forcing such a person to disclose assets or face coercive enforcement would be without jurisdiction under Part II of the Arbitration and Conciliation Act, 1996.Justice Somasekhar Sundaresan passed the ruling while allowing two interim applications filed by Amstrad Consumer India Pvt. Ltd. (Respondent No. 1) and its shareholder...

GST Order Can't Be A Copy-Paste Of Showcause Notice, Independent Reasoning Must Be Present: Bombay High Court

The Bombay High Court held that a GST order can't be a copy-paste of the show cause notice and that independent reasoning must be present. Justices M.S. Sonak and Jitendra Jain stated that “simply cutting and pasting the allegations in the show cause notice or mechanically reciting them verbatim does not inspire confidence that due consideration has been shown to the cause, and the decision is made after its due consideration. Ultimately, these are aspects of natural justice principles...

GST TRAN-I Credit Can Be Revised Based On Manually Filed Excise Return: Bombay High Court

The Bombay High Court held that GST TRAN-I credit can be revised based on manually filed ER-1 Return. Justices M.S. Sonak and Jitendra Jain stated that “there were technical issues with respect to revising TRAN-1 and non-availability of electronic mode to revise excise return and it is only after directions issued by the Supreme Court in the case of Union of India vs. Filco Trade Centre Pvt. Ltd. 2022 that the assessee was able to revise its TRAN-1/TRAN-2 by filing manual revised...

GST Notice U/S 79(1)(c) Can't Be Issued Directly To Bank; Must Be Served To Actual Taxpayer: Bombay High Court

The Bombay High Court held that a GST notice under Section 79(1)(c) of the CGST Act can't be issued directly to the bank. Justices M.S. Sonak and Jitendra Jain observed that the notice under Section 79(1)(c) of the CGST Act was not addressed to the assessee but directly to the bank. “Where such notice is served on a person, he can prove to the satisfaction of the officer issuing the notice that the money demanded or any part thereof was not due to the person in default or that he...

Insurance Claim Received On Dead Horses Is Capital Receipt, Not Taxable As Income U/S 41(1): Bombay High Court

The Bombay High Court held that insurance claim received on dead horses is capital receipt, not taxable as income under Section 41(1) Of Income Tax Act. The bench opined that horses in respect of which the insurance claim was received were Assessee's capital assets and that therefore insurance receipt arising therefrom could only have been considered as capital receipt, not chargeable to tax. The question before the bench consists of Chief Justice Alok Aradhe and Justice Sandeep...

[Income Tax Act] Amount Indicated In P&L Account As Provision For Doubtful Debts/Advances Cannot Be Treated As "Reserve" U/S 115JA: Bombay HC

The Bombay High Court has ruled that a provision for doubtful debts cannot be treated as either a "reserve" or a "provision for liability" under clauses (b) or (c) of the Explanation to Section 115JA of the Income Tax Act, 1961, and thus cannot be added back to the book profits for the purpose of minimum alternate tax (MAT). The Court accordingly overturned the addition of ₹2.49 crore made by the Assessing Officer and upheld by the Tribunal.A Division Bench of Chief Justice Alok Aradhe and...

Reward Schemes Must Be Fairly Implemented: Bombay High Court Directs Dept To Pay Informer For Assisting In Tax Recovery

The Bombay High Court has directed the department to pay informer for assisting in tax evasion recovery. Justices M.S. Sonak and Jitendra Jain stated that “If the Government has formulated a reward scheme, it must be implemented fairly and transparently. Informers who take risks and invest time must not be made to run from pillar to post to secure what may be due and payable. There must be no unreasonable delay in paying the determined reward amounts, and the practice of raising...