Employee Cannot Be Made To Pay Tax Already Deducted Due To Employer's TDS Default: Orissa High Court

The Orissa High Court has ruled that an employee cannot be made to pay income tax again to the extent tax has already been deducted from their salary, merely because the employer failed to deposit it or correctly report the deductions.A Division Bench of Justice Sanjeeb K. Panigrahi and Justice Murahari Sri Raman observed that employees should not suffer because of their employers' failure to deposit tax deducted at source (TDS) with the Income Tax Department.“As it is specific case of the...

Discount On Shares Issued Under ESOP Is Deductible Business Expenditure: Kerala High Court

The Kerala High Court has held that the discount arising from the allotment of shares to employees under an Employee Stock Option Plan (ESOP) constitutes revenue expenditure deductible under Section 37(1) of the Income Tax Act, 1961. A Division Bench of Justice Devan Ramachandran and Justice Basant Balaji dismissed the Revenue's appeal against Geojit Financial Services Ltd and affirmed the order of the Income Tax Appellate Tribunal, Cochin Bench. The Court held that the difference...

How A Nation Taxes Its People Reflects Who Deserves Liberty, Right To Love: Same-Sex Partners Tell Karnataka HC In Tax Exemption Case

A same-sex couple has argued before the Karnataka High Court that the Income Tax law effectively makes them pay tax for expressing love for their partners, while married couples can exchange gifts without the same tax burden. Arguing that a nation's tax laws reflect the values it upholds, Advocate Dr. Dhruv Janssen Sanghvi, in a rejoinder, appearing for Anurag Kalia and Akhilesh Godi, a same-sex couple, submitted that excluding same-sex partners from the gift-tax exemption available to spouses...

Reassessment Notice For AY 2015-16 Issued In 2026 Time-Barred: Delhi High Court

The Delhi High Court has quashed an Income Tax reassessment notice issued for Assessment Year (AY) 2015-16, holding that the notice issued in 2026 was clearly beyond the permissible limitation period under Section 149 of the Income Tax Act, 1961.The Division Bench of Justices Dinesh Mehta and Aditi Choudhary allowed a writ petition challenging the notice dated March 31, 2026, issued under Section 148 of the Act seeking to reassess Petitioner's income for AY 2015-16.Petitioner contended that the...

Income Tax Department Cannot Wait For Certified Copy When Digitally Signed Order Is Available: Bombay High Court

The Bombay High Court has ruled that the Income Tax Department cannot wait for a certified copy of a court order to compute the limitation period for completing an assessment when a digitally signed copy has already been received by the relevant tax authorities.“In this era of electronic filing and electronic uploading, and in order to alleviate difficulties of the litigants before us, this is a practice which this Court has adopted. Instead of asking a litigant to apply for a certified copy of...

Madras High Court Rules In Favour Of Mahindra Holidays On ₹158 Crore Membership Fees, Software Licence Tax Dispute

The Madras High Court has ruled in favour of Mahindra Holidays and Resorts India Ltd. on its accounting treatment of membership fees worth ₹158.43 crore. It also held that expenditure on domestic software licence renewals could not be disallowed merely because the company had deducted tax on software purchases from foreign suppliers.A Division Bench of Justice Anita Sumanth and Justice S. Raveekumar observed that the company could apportion membership fees over the membership period instead of...

Income Tax Penalty Can Be Waived Even In Cases Of Misreporting After 2026 Amendment: Bombay High Court

The Bombay High Court has ruled that taxpayers can seek waiver of income tax penalties even in cases of misreporting of income under the amended Section 270AA of the Income Tax Act, 1961. It also held that an earlier rejection does not prevent a taxpayer from applying again under the amended law.“However, we note that the position has changed considerably as a result of the amendments made by the Finance Act, 2026 w.e.f. 1st March 2026. As is evident from the amendments made, an application for...

Same-Sex Partners Must Challenge Marriage Laws, Not Income Tax Act For Gift Tax Exemption: Centre To Karnataka HC

The Centre on Friday told the Karnataka High Court that same-sex partners seeking a tax exemption on gifts exchanged between spouses must challenge the laws governing marital status, rather than the Income Tax Act. The latter, it argued, merely refers to the legal status recognised under other enactments. Additional Solicitor General K. Arvind Kamath, appearing for the Centre before Justice B.M. Shyam Prasad, made the submission while opposing a petition by Anurag Kalia and Akhilesh Godi. The...

Delhi High Court Gives Income Tax Dept Final Chance To Credit ₹3.65 Crore Advance Tax To 92-Year-Old Assessee

The Delhi High Court has given the Income Tax Department a final opportunity to comply with its earlier order directing adjustment of a ₹3.65 crore advance tax payment towards the capital gains tax liability of a 92-year-old assessee, failing which the Court said it would direct payment of interest on the amount.The Division Bench of Justices Subramonium Prasad and Renu Bhatnagar has directed the Department to ensure that the amount is credited to the assessee's account by October 31, 2026.The...

Director Can't Challenge Income-Tax Search Against Company In Individual Capacity: Karnataka High Court

On 6 October, the Karnataka High Court held that a company director cannot challenge an income-tax search and seizure conducted against the company in his individual capacity when the search is not directed against him personally. Justice B M Shyam Prasad found force in the Revenue's contention that Obedulla A, a director of Attica Gold Private Limited, could not challenge the search against the company in his individual capacity. The Bench observed: “If any person could have a grievance with...

Calcutta High Court Rejects Revenue's Bid To Reopen Facts In ₹9.32 Crore Unlisted Share Sale Addition

The Calcutta High Court on 5 October dismissed the Revenue's appeal against deletion of a Rs. 9.32 crore addition relating to sale proceeds from unlisted equity shares of Superdeal Resources Private Limited, finding that the Tribunal's conclusions were based on the evidence on record. A Division Bench comprising Justices Rajarshi Bharadwaj and Sudip Deb held that the Revenue cannot seek a fresh examination of factual findings in an appeal under Section 260A of the Income Tax Act in the absence...

Kerala High Court Upholds Rejection Of South Indian Bank's ₹52 Cr. Additional Bad-Debt Claim To ITAT

The Kerala High Court on 28 September held that the Income Tax Appellate Tribunal (ITAT) cannot refuse to examine a bad-debt disallowance on merits merely because a separate additional claim was raised before the first appellate authority. A Division Bench comprising Justices Devan Ramachandran and Basant Balaji remanded South Indian Bank's Rs. 14.10 crore bad-debt disallowance to the ITAT for fresh consideration, while upholding the rejection of the Bank's separate Rs. 52 crore additional...