Lower Cost Of Acquisition Without Justification Not Warranted: ITAT Ahmedabad

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) on 27 February held that adopting a lower deemed cost of acquisition than that accepted for co-owners, without justification, was not warranted. A Tribunal Bench comprising Vice-President Dr. B.R.R. Kumar and Judicial Member Suchitra Kamble allowed the appeal of Nirmalaben Kamleshbhai Contractor and allowed deduction under Section 54EC, finding the investment was made within the prescribed period. The Tribunal held that, “adopting...

Balance Depreciation Allowed In Subsequent Year For Assets Used Less Than 180 Days: Madras High Court

The Madras High Court on 2 March held that a taxpayer is entitled to claim the balance 50% of additional depreciation in the subsequent assessment year where new plant and machinery are put to use for less than 180 days in the year of acquisition. A Bench of Justice G. Jayachandran and Justice Shamim Ahmed allowed an appeal filed by Wheels India Limited against an order of the Income Tax Appellate Tribunal for the assessment year 2007–08, which had upheld the partial disallowance of the...

ITAT Ahmedabad Deletes Tax Addition Based On Loose Sheets Found During Search, Cites Lack Of Evidence

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) has upheld the deletion of tax additions made against a mouth freshener manufacturing company, finding that the additions were founded only on loose sheets that lacked basic particulars and were unsupported by any corroborative evidence to establish unaccounted transactions. The case arose from a search conducted on a third party, during which certain handwritten loose sheets were found in the possession of an employee of the...

ITAT Ahmedabad Sets Aside Ad-Hoc Expense Disallowance As AO Failed To Point Out Defects

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) has recently set aside ad-hoc disallowances made against Raghani Tradelink, a commission agent engaged in facilitating sales of sarees, suits, and garments across India, holding that additions towards sub-brokerage and administrative expenses cannot be sustained when the Assessing Officer fails to point out specific discrepancies in the evidence produced by the assessee. The coram comprising Judicial Member Sanjay Garg and...

Charitable Trust Cannot Be Denied Income-Tax Registration For Lack of Irrevocability Clause In Trust Deed: Bombay High Court

The Bombay High Court has held that the absence of an explicit irrevocability clause in a trust deed cannot be a ground to reject the application of a charitable trust for registration or renewal under Section 12AB of the Income Tax Act, 1961. Section 12AB governs the grant and renewal of registration to charitable and religious trusts for the purpose of claiming tax exemption, and the Court observed that the statute does not require such a clause and that a trust is ordinarily irrevocable...

CBDT Notifies 2026 Income Tax Rules Introducing 'Tax Year' System, Streamlines Compliance Framework

Today, the Central Board of Direct Taxes (CBDT) notified the Income Tax Rules, 2026, which will come into force from 1 April 2026. The draft rules were published on 9 February 2026 for public consultation, inviting suggestions and feedback.The rules establish the procedural framework for implementing the Income Tax Act, 2025, which repeals the Income-tax Act, 1961. Also Read: CBDT Issues Draft Income Tax Rules And Forms For New Act With 34% Fewer Rules [Read Draft Rules Here]The repeal...

ITAT Upholds Allowance Of Foreign Travel Expenses, Says No Income From Visited Countries Alone Cannot Justify Disallowance

The Mumbai Income Tax Appellate Tribunal (ITAT) has upheld the deletion of disallowance of foreign travel expenses made against a company engaged in global management and financial consultancy services.The court held that in the facts of the case, the expenditure could not be disallowed merely because no income was directly earned from certain countries visited during the relevant year where the taxpayer had produced material showing business purpose and nexus with its activities. The case...

ITAT Ahmedabad Grants Partial Relief To Arrow Clothing In Demonetisation Cash Deposit Addition Case

The Income Tax Appellate Tribunal (ITAT) at Ahmedabad partly allowed an appeal of Arrow Clothing Pvt. Ltd, holding that addition for unexplained cash deposits during demonetisation was justified, but the taxpayer was entitled to credit for opening cash balance and prior bank withdrawals. A coram of Judicial Member Sanjay Garg and Accountant Member Annapurna Gupta held that anomalies were found only in the explanation relating to cash sales and not in the opening cash balance or bank withdrawals...

Escaped Income Must Include Real Taxable Income, Not Aggregate Value: ITAT Ahmedabad

The Ahmedabad Income Tax Appellate Tribunal (ITAT) on 16 March, held that the expression “income chargeable to tax which has escaped assessment” under Section 149 of the Income Tax Act refers to the actual taxable income sought to be brought to tax, and not the gross value of underlying transactions. A Bench comprising Judicial Member T.R. Senthil Kumar quashed the reassessment proceedings for Assessment Year 2017–18, holding that the assumption of jurisdiction under Section 148 was...

Karnataka High Court Frames Guidelines On Calling For Production Of Spouse's Income-Tax Returns In Maintenance Cases

The Karnataka High Court has framed detailed "gender-neutral" guidelines regulating the procedure to be followed by matrimonial courts when applications are made seeking production of income tax returns and other financial records in maintenance and alimony proceedings, in order to ensure uniform practice while safeguarding the confidentiality of personal financial information. A single bench of Justice Suraj Govindaraj held that the Right to Information Act is not the proper mechanism for...

RTI Cannot Be Used To Obtain Spouse's Income Tax Returns In Maintenance Dispute Without Larger Public Interest: Karnataka High Court

The Karnataka High Court, in a recent noteworthy ruling, has held that income tax returns and financial details of a spouse constitute “personal information” under the Right to Information Act, 2005, and cannot be disclosed in the absence of a demonstrable larger public interest, even in maintenance disputes. Observing that private matrimonial disputes do not by themselves satisfy the statutory requirement for disclosure, a single bench, Justice Suraj Govindaraj, held, "While the need for a...

Allahabad High Court Allows Anand And Anand Firm's Writ, Holds Favorable Findings Prevent Remand

The Allahabad High Court on 16 February held that once a finding is recorded in favour of a party, the appellate authority cannot remand the matter back to the original assessing authority to redetermine the issue. A Single Judge Bench of Justice Vikas Budhwar allowed the writ petition filed by Anand and Anand Law Firm, holding: “Apparently, the writ petitioners herein are questioning the appellate order dated 30.04.2024 passed by the Joint Commissioner, GST (Appeals) for various periods....