Income Tax Act, 1961

The Supreme Court heard a civil appeal filed by the Commissioner of Income Tax, Gujarat against Mis United Phosphorous Ltd. concerning two tax issues: (1) whether interest paid on borrowings for capital assets that were not put to use in the relevant financial year could be allowed as a deduction under section 36(1)(ii…

Core Health Care Ltd., a manufacturer of intravenous solutions, borrowed money in 1991‑92 to install new machinery and claimed a deduction for the interest paid under Section 36(1)(iii) of the Income‑Tax Act. The assessing officer disallowed the deduction, relying on the Challapalli Sugars case, on the ground that the …

The appellants, members of a Hindu Undivided Family (HUF), contended that no valid assessment order had been issued for the HUF for assessment year 1955-56 because the order was unsigned, and that they never received statutory notices. The Income Tax Officer proceeded under Section 147(a) and later under Sections 148 a…

Kalinga Tubes Ltd., a steel tube manufacturer, was assessed for central sales tax for the year 1962-63. The Sales Tax Officer demanded Rs 11,02,698 in 1966, which the Sales Tax Tribunal reduced to Rs 2,22,161 in 1970. The assessee claimed this amount as a deduction under Section 37 of the Income‑Tax Act in the assessme…

The State Bank of Travancore, a subsidiary of SBI, maintained its books on a mercantile basis and charged interest on advances it deemed "sticky" (highly doubtful of recovery) by debiting borrowers but crediting the amounts to an "Interest Suspense Account" instead of its profit‑and‑loss account. It claimed that such i…

The appellants leased premises for nine years with a clause allowing the lessee to extend the lease for a further nine years, subject to conditions. The Income Tax Department treated the lease as exceeding twelve years, invoking Chapter XXC of the Income Tax Act and requiring filing of Form 37‑1. The appellants contend…

M/s Tranvancore Titanium Products Ltd obtained a loan of Rs. 491 lakhs from the Kerala Government and created a "Loan Redemption Reserve" of Rs. 1 crore to meet the loan liability. The assessing authority treated the amount as a provision and excluded it from capital for the purpose of surtax under the Companies (Profi…

Mahabir Cold Storage, a partnership firm newly constituted after the original firm Prayagchand & Hanumanmal took on Periwal & Co. as a partner, claimed a development rebate for machinery installed by the original firm in 1959‑60. The claim was made in the 1962‑63 assessment year. The issue was whether the new firm, a s…

The respondent, Biju Patnaik, was assessed for the year 1957-58 but allegedly failed to disclose a Rs.15 lakh capital gain from the sale of his mining business. The Income Tax Officer, after obtaining approval, issued a notice under sections 147(a) and 148 of the Income Tax Act, 1961 to reopen the assessment, alleging …

The State of Odisha issued an auction notice for a five‑year sand‑quarry lease; Shanti Construction Pvt. Ltd., the highest‑price bidder, was declared non‑responsive for not submitting an Income Tax Return for FY 2021‑22, while a lower‑priced bidder was declared successful. The dispute centered on the meaning of “previo…

The Commissioner of Income Tax (Central) Kanpur appealed against judgments of the Allahabad High Court that had favored J.K. Charitable Trust in several assessment years. The central issue was whether the Revenue could be barred from filing an appeal in certain assessment years when it had not appealed in other years i…

The Commissioner of Income Tax issued a revision order under Section 263 of the Income Tax Act on 26 March 2012, revising an assessment order for AY 2008‑09 that had been passed on 30 December 2010. The assessee argued that the revision order was barred by the two‑year limitation because it was received by him on 29 No…

The Supreme Court examined whether the Central Board of Direct Taxes' Circular No. 789, issued under Section 119 of the Income‑Tax Act, was ultra vires the Act and whether the Indo‑Mauritius Double Taxation Avoidance Convention (DTAC), notified under Section 90, could override inconsistent provisions of the Income‑Tax …

Aditya Minerals Pvt. Ltd. obtained a 15‑year mining lease with a monthly rent of Rs.35 per acre and was required to deposit an amount equal to the total rent for the lease term as a guarantee, which was adjustable against monthly rent and bore no interest. The assessee claimed this deposit as revenue expenditure for th…

The Supreme Court examined whether the construction of a dam or the laying of foundations by pressure piling could be treated as "manufacture or production of articles" under Sections 80HH(2)(i) and 84(2)(iii) of the Income‑Tax Act, 1961, and whether machinery used for dam and canal construction qualified for investmen…

The Supreme Court granted the petitioner absolute interim anticipatory bail on 8 December 2023, ordering his release on bail if arrested. Despite this, the police remanded him to custody on 13 December 2023, and the magistrate failed to release him after the remand period, resulting in an illegal detention of about 48 …

The respondents entered into a sale agreement for a tenanted immovable property in Delhi for Rs. 79 lakhs and filed Form 37(1) under Chapter XX‑C of the Income Tax Act. The Appropriate Authority (AA) determined that the consideration was 24% below the fair market value (FMV) by comparing the subject property with three…

The Union of India appealed against a Delhi High Court order that set aside an acquisition order made by the Appropriate Authority under Chapter XX‑C of the Income Tax Act, 1961. The Authority had held that the sale price of a property in East of Kailash was under‑valued by comparing it with another property in a diffe…

The assessees, Attar Singh and Gurmukh Singh, made cash payments exceeding Rs.10,000 for purchases of stock-in-trade, which the assessing authority disallowed as deductions under Section 40A(3) of the Income Tax Act, 1961 read with Rule 6DD of the Income Tax Rules, 1962. The assessees challenged the validity of Section…

Hindustan Wires Products Ltd., a manufacturer of insulated copper wires, claimed that its winding wires qualified as "cables" under item 7 of the Fifth/Sixth Schedule of the Income Tax Act, 1961, and therefore entitled it to development rebate and priority‑industry deductions under sections 33 and 80‑I for assessment y…

Mis. Kanchanganga Sea Foods Ltd., an Indian exporter of seafood, chartered fishing vessels from a Hong Kong company and agreed to pay the charter fee as 85% of the gross earnings from fish sales. The catch was brought to Chennai, valued, and customs duties were paid before the non‑resident company received its share. T…

Sm. Amiya Bala Paul constructed a house and disclosed investment amounts in the assessment years 1982-83 and 1983-84. The Assessing Officer rejected the second disclosure and, invoking Section 55A of the Income Tax Act, referred the valuation of the house's construction cost to a Valuation Officer appointed under the W…

L.K. Trust borrowed Rs.3.80 crore from Corporation Bank to purchase shares of Shaw Wallace and transferred the amount to its subsidiary, which in turn advanced it to a third party for the same purpose. The Trust paid Rs.21,74,234 as interest on the loan and claimed a deduction under section 36(1)(iii) of the Income Tax…

The All India Bank Officers’ Confederation and other bank staff unions challenged Section 17(2)(viii) of the Income Tax Act, 1961 and Rule 3(7)(i) of the Income Tax Rules, 1962, alleging that they amounted to an excessive delegation of the essential legislative function to the Central Board of Direct Taxes and that the…

The respondent, M/s Travancore Sugar & Chemicals Ltd., claimed a deduction for a vend fee of Rs 22,87,512 paid to the Kerala Government, which the assessing officer disallowed under Section 438 of the Income Tax Act because it was not paid before the expiry of the relevant previous year. The Commissioner of Income Tax …

The Commissioner of Income Tax, Surat appealed against the order of the Income Tax Appellate Tribunal which had set aside a penalty imposed on Saheli Leasing & Industries Ltd. for concealment of income. The assessee had filed a return showing NIL income and claimed excessive depreciation, resulting in a loss, but the a…

The respondent, Arunagiri Chettriar, retired from a partnership firm in 1963 and later the firm was dissolved. The Income Tax Officer issued a notice that the respondent was jointly and severally liable for tax arrears of the firm for assessment years 1962-63 and 1963-64, arguing that liability attaches to any partner …

Bharat Beedi Works (P) Ltd., a private limited company, paid annual royalties to a partnership firm for the use of its brand name. The three partners of the firm were also directors of the company. The Income Tax Officer allowed the royalty deductions, but the Commissioner disallowed them under Section 40(c) of the Inc…

Minerals and Metals Trading Corporation (M.M.T.C.) acted as the intermediary in a private barter scheme through which Ferro Alloys Corporation exported manganese and chrome concentrates. The parties executed contracts whereby title to the goods passed to M.M.T.C., which issued letters of credit, shipping documents and …

The appellants, partners of an Indian law firm, were engaged by a German corporation and, through London solicitors, allowed a UK barrister, Mr. Blanco White, to appear in three Calcutta High Court suits. Although the firm did not brief or pay the barrister, the Income Tax Officer treated them as agents under section 1…

The assessee, Ahmed Ibrahim Sahigra Dhoraji, possessed concealed income of Rs 7 lakhs earned between 1957‑58 and 1964‑65. He made a voluntary disclosure under Section 68 of the Finance Act 1965 and paid tax at the prescribed rate. He claimed that the tax paid could be deducted as a "debt owed" under Section 2(m) of the…

The Regional Provident Fund Commissioner appealed against a Karnataka High Court order that had held Raj's Continental Exports (P) Ltd was not a branch of Mis. Continental Exporters, a proprietorship owned by the same individual who was also the Managing Director of the company. The respondent claimed infancy protectio…

The Board of Industrial and Financial Reconstruction (BIFR) approved a merger scheme to revive Flowmore Polyester Ltd., a sick company, by merging it with SRF Ltd. Garware Plastics and Polymers Ltd., which had earlier submitted a stand‑alone revival proposal that was rejected, claimed to be an "interested person" and s…

The Andhra Pradesh State Road Transport Corporation (APSRTC), a statutory corporation created under the Road Transport Corporation Act, 1950, claimed exemption from income tax for the assessment years 1960-61, 1961-62 and 1962-63 under section 4(3)(i) of the Income‑Tax Act, 1922 and section 11 of the Income‑Tax Act, 19…

The petitioner, Ashok Kumar Mittal, applied for an allotment of a Maruti 800 car but due to a computer error his application was recorded for a Maruti truck; the company agreed to consider his case under the manufacturer's discretionary 5% quota. In the course of correspondence, Maruti Udyog disclosed its existing prac…

During the COVID-19 pandemic, the petitioner conducted three crowdfunding campaigns on the Ketto platform. The Enforcement Directorate (ED) opened investigations under FEMA and later filed a complaint under the Prevention of Money‑Laundering Act (PMLA), attaching the petitioner’s bank account in Navi Mumbai. The Specia…

Maruti Suzuki India Ltd., a manufacturer of automobiles liable to excise duty, claimed deductions under Section 43B of the Income Tax Act for a large unutilised MODVAT credit of Rs 69.93 crore and for sales tax recoverable amounting to Rs 3.08 crore for AY 1999‑2000. The Assessing Officer, the Commissioner and the ITAT…

Rolta India Ltd. filed a return showing nil total income, but the Assessing Officer levied tax on book profits under Section 115JA and charged interest under Sections 2348 and 234C for default in advance tax. The assessee contended, relying on the Karnataka High Court's Kwality Biscuits decision, that interest could no…

A search under Section 132 of the Income Tax Act was conducted on 17 January 2001 at the premises of Suresh N. Gupta, uncovering undisclosed income of Rs.1,62,427. The Assessing Officer levied tax at the 60% rate prescribed by Section 113 and imposed a 17% surcharge relying on the Finance Act, 2001. The assessee challe…

The case involved M/s Jindal Steel & Power Ltd., which operated captive power plants to supply electricity to its own industrial units at Rs 3.72 per unit while selling surplus power to the State Electricity Board at Rs 2.32 per unit. The assessing officer reduced the deduction claimed under Section 80‑IA, treating Rs …

The appellant, a medical practitioner, was arrested for manufacturing and selling heroin, and the seized heroin was claimed as a loss in his income‑tax return on the ground that it formed part of his stock in trade. The assessing officer disallowed the claim, treating the amount as income from undisclosed sources, and …

The Bharat Diamond Bourse, a company limited by guarantee, claimed exemption under Section 11 of the Income Tax Act for AY 1989‑90 and 1990‑91, asserting it was a charitable institution. The Assessing Officer denied the exemption, holding that the Bourse’s objects were not charitable and that it had breached Section 13…

The appellants, assessors under the Income Tax Act, challenged the interpretation of Section 269UA(b) regarding the calculation of "apparent consideration" for immovable property transferred to the Central Government. They argued that the discount should be computed for the period between the Government's payment of th…

The appellant, a sandalwood oil manufacturer, was convicted under Section 27(1)(d) of the Kerala Forest Act for allegedly possessing forest produce illicitly removed from a reserved forest. The High Court upheld the conviction, treating the presumption under Section 69 as creating a reverse burden of proof on the accus…

M/s. Polyflex (India) Pvt. Ltd. paid excise duty in 1986, later obtained a refund in 1988 after the levy was held unconstitutional. The refund amount was brought to tax for AY 1989-90 under Section 41(1) of the Income Tax Act, 1961. The assessee argued that the provision did not apply because the liability dispute was …

The assessee, a Hindu undivided family owning agricultural land in Kerala, sold about 367 spontaneously grown trees, retaining the stumps and roots, under an agreement that prohibited cutting the sprouts. The Income‑Tax Officer treated the entire consideration of Rs 1,75,000 as taxable income, while the assessee argued…

Zunjarrao Bhikaji Nagarkar, then Collector of Central Excise, ordered confiscation of excisable goods and confirmed duty against Mis. Hari Vishnu Packaging Ltd. but did not impose a penalty under Rule 173Q of the Central Excise Rules. The Central Board of Excise directed him to appeal to the Appellate Tribunal on the q…

M/s RamBal Private Ltd., a manufacturer of nuts, bolts and screws for automobiles (item 20 of the Fifth Schedule), claimed a 35% development rebate under Section 33(1)(b)(i)(A) of the Income Tax Act, 1961 for machinery installed before 1‑April‑1970. The Income‑Tax Officer allowed only a 20% rebate, contending that the …

The appellant, a company in liquidation, sold its assets and invested the proceeds in fixed deposits, earning interest income. The liquidator incurred various expenses (salaries, legal fees, etc.) which the company sought to deduct from the interest under section 57(iii) of the Income Tax Act. The Assessing Officer tax…

Northern Corporation imported MSCR defective sheets in 1984 and stored them in a customs warehouse. The Income Tax Department imposed a ban under Section 132(1) of the Income Tax Act, 1961, preventing the goods from being cleared. After the ban was lifted in 1988, customs demanded payment of duty at the higher rate pre…

The appellant, C.I.T., Mumbai, challenged the High Court’s order allowing a loss of Rs. 2,09,44,793 claimed by the respondent, a mutual fund unit trader, to be set off against taxable income. The respondent had bought mutual fund units before the record date, received a tax‑free dividend under section 10(33), and sold …

The Supreme Court examined whether the "balancing charge" provision of Section 41(2) of the Income Tax Act, 1961 could be read into Section 41(1) to tax profits from the sale of fully depreciated bottles and crates when Section 41(2) was deleted for assessment years 1988‑89 to 1998‑99. It held that each sub‑section of …

The appellants, Gopaldas Udhavdas Ahuja and his widow, were found to possess primary gold that had been seized by Income‑Tax authorities in August 1974 and subsequently taken over by a Gold Control Officer under the Gold (Control) Act, 1968. They claimed they were unaware of the gold hidden in a secret compartment and …

The Supreme Court examined whether the assessment order against Mis. Greenworld Corporation was passed under the undue influence of the Commissioner of Income Tax, Shimla, thereby rendering it a nullity. It held that a revisional authority under Section 263 can intervene only when an order is erroneous and prejudicial …

The appellant, the Commissioner of Income Tax, challenged the assessment of film producer Joseph Valakuzhy who claimed a carry‑forward of amortisation expenses under Rule 9A of the Income Tax Rules for a feature film that was not exhibited for 180 days and did not recover its production cost. The revenue argued that th…

R & B Falcon (A) Pvt. Ltd., an Australian company supplying offshore drilling rigs and crew, provided free air and helicopter transport for its foreign‑resident employees from their home countries to the rig in India and back. The company sought an advance ruling which held that the transport expense was liable to Frin…

Hindustan Times Ltd purchased a residential building and later demolished it to erect a multi‑storeyed commercial building. The company paid Rs 36,96,516 as an additional premium for the commercial use of the extra built‑up area and added this amount to the cost of the new building, claiming depreciation under Sections…

The case concerned whether the amendment to Section 153C of the Income Tax Act, 1961 introduced by the Finance Act, 2015 applies to searches under Section 132 that were initiated before the amendment’s effective date of 1 June 2015. A search was conducted on 4 September 2013, and material relating to third parties was …

M/s Paville Projects Pvt. Ltd. sold its building for Rs 33 crore in AY 2007‑08 and claimed a deduction of Rs 31.05 crore as "cost of improvement" to discharge encumbrances arising from a family settlement of shareholders. The Assessing Officer accepted this claim and passed an assessment under section 143(3). The Commi…

The Supreme Court examined the third proviso to Section 254(2A) of the Income Tax Act, 1961, which mandates automatic vacation of a stay after 365 days irrespective of who caused the delay. The Court held that the provision treats assessees who delay the appeal the same as those who do not, thereby violating the equali…

The appellant, Burmah Shell Oil Storage and Distribution Co. (now Bharat Petroleum), purchased iron cylinders as returnable packages for LPG distribution, costing Rs 1,09,63,754, and claimed no depreciation. In 1961 it sold the cylinders to the refinery for Rs 82,19,947, incurring a loss of Rs 27,43,807, which it sough…

Brakes India Ltd paid a foreign technical director a total remuneration of Rs 66,000, of which Rs 28,576 were perquisites. The Assessing Officer disallowed the portion of perquisites exceeding one‑fifth of the salary under Section 40(c)(iii) of the Income‑Tax Act, 1961. The Appellate Assistant Commissioner allowed the …

Salem Cooperative Central Bank, a cooperative society engaged in banking, received Rs. 19 as interest on a security deposit with an electricity distribution company. The Income Tax Officer treated the amount as income from other sources and levied an additional surcharge under the Finance Act. The Appellate Assistant C…

The Income Tax Department seized gold ornaments from the premises of Babula Agarwal under Section 132 of the Income‑Tax Act, 1961. Babula claimed the ornaments belonged to his step‑mother and ultimately to the plaintiff, Parmeshwari Devi Sultania, who filed a petition with the officer for their return but was rejected.…

The appellant, Managing Director of Karna Distillery Co., transferred Rs 1,74,639 to a partnership firm owned by his children, later showing the amount as returned and then as a loan to the children. The Assessing Officer added the interest on this amount to the appellant's income under Sec. 61 of the Income‑Tax Act. T…

The appellant, an individual with salary and partnership income, filed his income‑tax returns for AY 2011‑12 and AY 2013‑14 well after the statutory due dates, attracting show‑cause notices under section 276CC of the Income Tax Act. He sought compounding of the offences under the 2014 Guidelines; the first application …

Virtual Soft Systems Ltd. filed a loss return for AY 1996-97 which was later reduced to a loss of Rs. 11,02,255 after disallowances and adjustments. The Assessing Officer levied a penalty of Rs. 31,71,692 under Section 271(1)(c)(iii) for concealment of income, despite the fact that no tax was payable. The ITAT deleted …

Basudev Dutta, an Ophthalmic Assistant employed by the West Bengal Government since 1985, was terminated in 2011 after a police verification report, filed 25 years later, labeled him ‘unsuitable’ for the post. He challenged the termination, asserting Indian citizenship based on his father’s migration certificate and ar…

The assessee, ACE Multi Axes Systems Ltd., claimed a deduction under Section 80IB(3) of the Income Tax Act for ten consecutive assessment years, asserting it qualified as a small‑scale industrial undertaking in the initial year. The Revenue disallowed the deduction for the assessment year 2005‑06 onward because the val…

Maharao Bhim Singh, the ruler of the former princely State of Kota, owned the Umed Bhawan residential palace, part of which was requisitioned and let out to the Ministry of Defence, generating rent. The issue before the Supreme Court was whether the exemption under Section 10(19A) of the Income‑Tax Act, 1961 and Paragr…

The Gujarat Maritime Board (GMB), a statutory authority created under the Gujarat Maritime Board Act, 1981 to develop minor ports, applied to be registered as a charitable institution under Section 12A of the Income‑Tax Act, 1961 to claim exemption under Section 11. The Commissioner of Income Tax rejected the applicati…

Hero Cycles Ltd. claimed a deduction under Section 36(1)(iii) of the Income Tax Act for interest paid on bank loans in AY 1988‑89. The Assessing Officer disallowed the claim, holding that the borrowed money was used to give an interest‑free advance to its subsidiary, Hero Fibres Ltd., and a low‑interest loan to its dir…

The main partnership, Mis. Nizamabad Group Sendhi Contractors, was a licensed lessee under the Abkari Act and was registered under the Income Tax Act. One of its partners, B. Posetty, could not meet his capital contribution, so he and nine others formed a sub‑partnership, "B. Posetty and Co.," to finance his share. The…

Britannia Industries Ltd. claimed a deduction of Rs 31,38,017 for rent, repairs, depreciation and maintenance of a guest house used in its business for AY 1994‑95. The Assessing Officer disallowed the amount under Section 37(4) of the Income‑Tax Act, 1961, and the High Court upheld the disallowance. The company appeale…

The respondent, T.N. Aravinda Reddy, sold his own house and, to avoid capital gains tax, acquired the family house jointly owned with his three brothers by executing three release deeds, each for a consideration of Rs. 30,000. The issue before the Supreme Court was whether such release deeds amounted to a "purchase" of…

Amin Chand Payarelal filed income‑tax returns for assessment years 1959‑60 to 1965‑66 after the extended period allowed under Section 139(4) of the Income Tax Act, 1961, and paid interest on the delayed filing. The Assessing Authority, an Inspecting Assistant Commissioner, levied a penalty under Section 271(1)(a). The …

The appellant, M/s Aspinwall and Co. Ltd., claimed investment allowance under Section 32A of the Income Tax Act for machinery used in coffee curing plants for the assessment years 1980-81 and 1983-84. The Income Tax Officer rejected the claim, but the Commissioner of Income Tax (Appeals) allowed it, a decision upheld b…

The assessee, Italindia Cotton Co. Ltd., incurred a loss in the assessment year 1960‑61 and sought to set off that loss against income in the assessment year 1963‑64. A change in shareholding occurred in 1963, and the Income‑Tax Officer denied the set‑off under Section 79 of the Income‑Tax Act, 1961, on the ground that…

The Commissioner of Customs ordered duty and penalties on Mis. Gujarat Perstorp Electronics Ltd. for importing drawings, designs and plans (FEEP) under a technical know‑how agreement, classifying them as manuals rather than "books" and denying exemption under Chapter 49.06. CEGAT set aside the order, relying on a large…

Sabarkantha Zilla Kharid Vechan Sangh Ltd., a cooperative society dealing in agricultural implements, seeds, livestock and other articles, claimed exemption from income‑tax on its profits and gains under Section 81(i)(d) of the Income Tax Act, 1961. The Income‑Tax Officer held that the exemption applied only to the por…

The Commissioner of Income Tax, Kochi appealed against Trans Asian Shipping Services (P) Ltd, which had elected to compute its income under the Tonnage Tax Scheme (TTS) of Chapter XIIG of the Income Tax Act, 1961. The dispute centered on whether income from slot‑charter arrangements, where the company did not own or fu…

The appellants, engaged as agents procuring frozen seafood for foreign buyers, claimed a 50% deduction under Section 80‑O of the Income Tax Act for service fees received in foreign exchange. The Assessing Officer held the services were rendered in India, not "from India", and disallowed the deduction. The Income Tax Ap…

The Commissioner of Income Tax appealed against the High Court’s order that Punjab Stainless Steel Industries should not include proceeds from the sale of steel scrap in its total turnover for calculating the deduction under Section 80‑HHC of the Income Tax Act, 1961. The assessee, a manufacturer and exporter of stainl…

The Income Tax Officer appealed the acquittal of a partnership firm and its partner, Hem Raj, who were convicted under Sections 276C(i), 277 and 278 of the Income Tax Act for filing false returns. The firm had filed a revised return for AY 1988-89, which the prosecution alleged was signed and verified by Hem Raj, leadi…

The Supreme Court examined whether a company, being a juristic person, can be prosecuted under Section 56 of the Foreign Exchange Regulation Act, 1973 when the statute mandates both imprisonment and fine. The appellants argued that because a company cannot be imprisoned, the provision could not apply to them. The Court…

The Supreme Court examined writ petitions filed by Tata Tea Ltd. and other tea companies challenging amendments made by the West Bengal and Kerala legislatures that sought to tax the entire income from the sale of tea grown and manufactured by the assessees. The petitioners argued that only 60% of such income could be …

Mahagun Realtors Private Ltd. (MRPL) merged with Mahagun India Private Ltd. (MIPL) by a court‑sanctioned scheme effective 1 April 2006. The Income Tax Department issued assessment notices and later an assessment order in the name of MRPL, which had ceased to exist after the amalgamation. The revenue argued that the ass…

The respondent, Mis Distillers Co. Ltd., a licensed arrack bottler under the Karnataka Excise Act, paid additional amounts to the Excise Department for bottling unmatured arrack and for non‑affixation of labels after failing to comply with a circular prescribing a 15‑day maturation period. It claimed these payments as …

The partnership firm Chetak Enterprises entered into an agreement with the Government of Rajasthan to construct a road and collect tolls. The road was completed on 27‑03‑2000 and the firm was converted into a private limited company on 28‑03‑2000 under Part IX of the Companies Act, 1956. The company claimed a deduction…

The Income Tax Department conducted a search and seizure operation under s.132(1) at the residence of a director of M/s Super Malls (P) Ltd., seizing a pen‑drive and documents showing cash receipts of the company. The Assessing Officer, who was also the Assessing Officer of the director, issued a notice to the company …

The appellant, the Commissioner of Income Tax, Bombay, challenged the deduction claimed by Tasgaon Taluka Sahakari Sakhar Karkhana Ltd., a cooperative sugarcane processor, for the price paid to cane growers that exceeded the Statutory Minimum Price (SMP) fixed under Clause 3 of the Sugar Cane (Control) Order, 1966. The…

The assessee, NRA Iron & Steel Pvt. Ltd., claimed receipt of Rs 17.6 crore as share capital/premium from various companies in AY 2009‑10. The Assessing Officer questioned the genuineness of the transaction and issued notices, but the investor companies did not appear and field enquiries revealed many were non‑existent …

Kakadia Builders Pvt. Ltd. and its promoter filed settlement applications before the Income Tax Settlement Commission while assessment proceedings were pending. The Commission, on 11 August 2000, added tax and waived interest under Sections 234A, 234B and 234C, but both the assessee and the Revenue filed rectification …

Bharat Commerce & Industries Ltd. appealed against the Commissioner of Income Tax, arguing that interest paid on delayed advance tax (under Sections 139 and 215) for AY 1972‑73 and interest paid on delayed tax under the Voluntary Disclosure of Income and Wealth Act, 1976 for AY 1977‑78 and 1978‑79 should be allowed as …

The Kotagiri Industrial Co‑operative Tea Factory Ltd., a co‑operative society, earned Rs 85,150 in the assessment year 1972‑73 and had carried forward losses of Rs 1,82,744. It claimed a deduction of Rs 53,386 under section 80‑P(2) of the Income Tax Act. The Income Tax Officer first set off the carried forward losses u…

The appellants, R. Dalmia and others, challenged assessments and reassessments made by the Revenue under Section 147 of the Income Tax Act, arguing that Section 144‑B, which provides a procedural safeguard and an extended 180‑day limitation period under Explanation 1(iv) to Section 153, does not apply to such assessmen…

The assessee, Alcock Ashdown & Co. Ltd., started a new industrial undertaking and purchased plant and machinery, some of which remained uninstalled at the end of the accounting year. It claimed a deduction under Section 84 of the Income‑Tax Act, 1961, on the basis that the cost of these assets constituted "capital empl…

The Aditanar Educational Institution, a society registered under the Societies Registration Act, 1960, was created to establish, run, manage or assist schools and colleges solely for educational purposes. It received substantial voluntary donations and filed nil returns, claiming exemption under Section 10(22) of the I…

City Mills Distributors Pvt. Ltd. was incorporated on 30 October 1972. Its promoters had earned Rs. 24,862 from business carried out between 1 and 20 October 1972, before the company existed, and the Income‑Tax Officer included this amount as pre‑incorporation profit in the company's assessment for AY 1974‑75. The Trib…

The partnership firm Keshavji Ravji & Co. paid interest to its partners on their capital credits and also received interest from the same partners on borrowings during the assessment year 1975-76. The Assessing Officer disallowed the interest paid to partners without setting off the interest received, leading to a high…

Devi Cinema and other firms challenged the disallowance of interest paid to their partners under Section 40(b) of the Income Tax Act, 1961. The Income Tax Appellate Tribunal had held that the entire interest paid by the firm to a partner was disallowable, ignoring any interest the partner paid back to the firm on borro…

Indo Rama Synthetics (I) Ltd. revalued its fixed assets in FY 2000, creating a revaluation reserve of Rs 288.58 crore. In FY 2001 it transferred Rs 26.11 crore of differential depreciation from that reserve to its profit‑and‑loss account, thereby reducing depreciation expense and showing a profit. The Assessing Officer…

National HydroElectric Power Corp. Ltd. (NHPC), a public sector electricity generator, sold power at tariff rates that included an Advance against Depreciation (AAD). In its profit and loss account NHPC reduced the sales figure by the AAD amount and did not debit the profit and loss account with it. The Authority for A…

The petition challenged a Ministry of Finance order that required the President of the Income Tax Appellate Tribunal (ITAT) to obtain prior approval for all postings and transfers of its judicial and accountant members. The Court examined whether the Central Government, under the Delegation of Financial Powers Rules, 1…

The assessee, Park Hotel Ltd., held leasehold interests in several premises and sub‑leased a portion to an associated company, Surrendra Overseas Ltd., under an unregistered deed. Rental income received by Surrendra was claimed to be taxable in its hands as income from house property, which it contested, leading to a T…

The respondents, co‑owners of a 42‑room residential building in Bangalore, leased the property to a company which sub‑let it as a hostel for students and working professionals. The respondents sought an advance ruling that the rent received was exempt from GST under Entry 13 of Notification 9/2017, which provides exemp…

M/s Seshasayee Steels Ltd entered into an agreement to sell land to Vijay Santhi Builders Ltd and granted a licence to commence construction, later executing a Power of Attorney and a compromise deed that reduced the consideration and stipulated payment by post‑dated cheques, all of which were encashed. The Assessing O…

The appellants, tenants of shops in a Gurudwara, challenged the Punjab Religious Premises and Land (Eviction and Rent Recovery) Act, 1997 on the ground that it withdrew the protection afforded to them under the East Punjab Urban Rent Restrictions Act, 1949 and violated Article 14. The Supreme Court held that the State …

The assessee filed voluntary income‑tax returns after the statutory deadline prescribed under s.139(1) of the Income Tax Act, 1961. The Income Tax Officer levied interest under clause (iii) of the proviso to s.139(1) and treated the assessee as in default, imposing penalties under s.271(1)(a). The assessee argued that …

The State Bank of India (SBI) paid Leave Travel Concession (LTC) to its employees for trips that included foreign legs and circuitous routes, and did not deduct tax at source (TDS). The Income Tax Department held SBI liable as an assessee in default under Section 201 of the Income Tax Act for failing to deduct TDS, a v…

The petitioners OCL India Ltd., SAIL and Hindalco challenged the levy of entry tax under the Orissa Entry Tax Act, 1999 (and similar statutes in Uttar Pradesh) on the ground that industrial townships, which had been excluded from municipal limits by notifications under the proviso to Article 243Q, were not "local areas…

Vidarbha Engineering, a lessee of three plots of land, entered into a collaboration agreement with Unitech to develop a commercial complex, whereby Unitech would construct the building, retain 78% of the built‑up area and transfer 22% to Vidarbha. The parties filed a statement under Section 269UC stating a consideratio…

The petitioners, a retired employee of Indian Oxygen Ltd. and a pensioners’ society, challenged the scheme of the company’s non‑contributory approved superannuation fund. They argued that improvements made to the fund in 1985 should have been extended to existing pensioners and that the denial of such benefits violated…

The respondents, members of a cooperative housing society, entered into a Joint Development Agreement (JDA) with developers to develop 21.2 acres of land. Only two instalments were paid and 7.7 acres were conveyed, for which capital gains tax was paid. The Assessing Officer and the ITAT treated the unreceived considera…

The petitioners, Dushyant N. Dalal and his wife, were ordered by SEBI to disgorge unlawful gains of Rs.4.05 crore and pay a penalty of Rs.6 crore, with a debarment of seven years if unpaid. They challenged the SEBI order, arguing that interest could not be levied retrospectively under Section 28A of the SEBI Act and th…

The deceased V. Madhava Raja left unpaid income tax, wealth tax and agricultural income tax. A partition suit was filed, and the State sought to recover the tax dues by attaching the estate, eventually ordering the sale of the property Devi Vilas Palace by public auction. The auction purchaser sought extensions and wit…

The Oil & Natural Gas Corporation (ONGC) awarded a contract to Western Geco for modernising a seismic vessel, which was to be returned by 9 July 2001. The vessel was delayed until 6 May 2002 due to licensing issues for US‑origin hydrophones and subsequent substitution with Canadian ones, leading ONGC to deduct amounts …

The appellant, Commissioner of Income Tax, Chennai, challenged the Madras High Court’s order upholding a deduction claimed by M/s Modern Engineers Construction Cooperative Society Ltd. under section 80P(2)(a)(i) of the Income Tax Act, 1961. The assessing officer had rejected the deduction on the ground that the income …

The appellants, General Finance Co. and another, received deposits in 1985 and were prosecuted in March 1989 under Section 276DD of the Income Tax Act for violating Section 269SS. Section 276DD was omitted from the Act by the Direct Tax Law (Amendment) Act, 1987, effective 1 April 1989. The High Court held the prosecut…

The appellant bought 90 non‑cumulative preference shares of Rs 1,000 face value at Rs 420 each. The company reduced the share capital twice, first paying Rs 500 per share in 1965 and later reducing the face value to Rs 50 and paying Rs 450 per share in 1966. The Income Tax Officer treated the Rs 450 per share received …

Cellulose Products of India Ltd, a chemical manufacturer, claimed exemption under Section 84 of the Income Tax Act for the assessment year 1966-67, arguing that its new industrial undertaking began producing "articles" only when it started manufacturing Carboxy Methyl Cellulose (CMC) in June 1961. The Income Tax Office…

Saraswati Industrial Syndicate Ltd. (the appellant) claimed exemption from tax on Rs.58,735, a trading liability that had been allowed to the Indian Sugar Company before it was amalgamated into Saraswati in 1962. The Income Tax Officer and the Appellate Assistant Commissioner disallowed the claim, but the Income Tax Tr…

The Jute Corporation of India Ltd. was assessed for income tax for AY 1974-75 and later claimed a deduction of Rs.11,54,995 for its liability to Purchase Tax, an issue not raised before the Income Tax Officer. While hearing its appeal before the Appellate Assistant Commissioner, the corporation was allowed to raise thi…

The appellant, K.P. Varghese, sold a house to his daughter‑in‑law and five children for the same price he had paid for it (Rs 16,500) and reported no capital gain for the 1966‑67 assessment year. The Income‑Tax Officer later issued a notice under section 148 and reassessed the assessee, fixing the fair market value at …

Japan Airlines (JAL) paid landing and parking fees to the Airports Authority of India (AAI) and deducted tax at source (TDS) at 2% under Section 194-C of the Income Tax Act, 1961. The Income Tax Department argued that the fees were "rent" under Section 194-1 and should attract TDS at 20%. The Supreme Court examined whe…

Upper Ganges Sugar Mills Ltd donated Rs 25,000 to the Vishwa Mangal Trust and claimed a deduction under Section 80G of the Income Tax Act, 1961. The Income‑Tax Officer initially allowed the deduction, but the assessment was later reopened under Section 147(b) and the claim was disallowed. The assessee’s appeal was dism…

The appellant, Commissioner of Income Tax, challenged the High Court’s order upholding the ITAT’s finding that a sale of development rights by Glowshine Builders was a transaction in stock-in-trade. The Assessing Officer had originally treated the receipt of Rs 15,94,06,500 as short‑term capital gains, but the ITAT rev…

The Union of India appealed against the High Courts' orders quashing reassessment notices issued under section 148 of the Income Tax Act after 1 April 2021. The Finance Act, 2021 had substituted sections 147‑151, introducing section 148A as a condition precedent for issuing a notice under section 148. The Supreme Court…

Two real‑estate developers (DLF Universal Ltd. and Ansal Properties) entered into agreements for the sale of flats that were still under construction and filed Form 37‑1 before the Income‑Tax Appropriate Authority seeking a no‑objection certificate for registration. The Authority issued notices under Section 269‑UC(4) …

A High Court judge filed an income‑tax return asserting that his constitutional salary was not taxable under the Income Tax Act, 1961. The tax authorities rejected his claim and the matter reached the Supreme Court on a special leave petition. The Court considered whether the salaries payable under Articles 125 and 221…

The appellants, a firm, voluntarily disclosed undisclosed income for the years 1958-65 before any tax authority detection and filed a statement of affairs. The Assessing Officer initiated penalty proceedings under Section 271(1)(c) of the Income Tax Act, imposing a penalty of Rs. 4,90,365, which was upheld by the Incom…

The appellants, who are relatives of the complainant, filed a petition under Section 482 of the CrPC seeking to quash FIR No. 21 of 2019 alleging offences under IPC sections 420, 342, 294(b) and 506(1). The complainant claimed he had invested Rs. 1.5 crore in a Nissan car dealership run by the appellants, was denied pa…

Madras Industrial Investment Corporation Ltd. issued debentures at a 2% discount, creating a liability of Rs. 3,00,000 payable over 12 years. For the assessment year 1968‑69 it wrote off Rs. 12,500 as the proportionate discount for six months. The Income‑Tax Appellate Tribunal allowed deduction of the entire discount, …

The appellants, a Hindu Undivided Family (HUF) of four members, filed a suit for partition in 1954, with a final decree in 1961. The Wealth Tax Officer assessed the family for assessment years 1958-59, 1959-60 and 1960-61, treating it as an undivided family of four members because no physical partition by metes and bou…

The Supreme Court entertained a public‑interest writ filed by Common Cause seeking enforcement of statutory provisions that require political parties to disclose their sources of funding and maintain audited accounts. The Court examined the obligations under Section 293A of the Companies Act, 1956, Sections 13A, 139(48…

The respondent owned an undivided one‑third share in a house occupied as his own residence along with his brother and other co‑owners. For assessment year 1962‑63 the Assessing Officer deducted the amount prescribed under Section 23(2) of the Income‑Tax Act from the total annual letting value of the house and then appo…

The Supreme Court examined whether the surplus lands owned by Shree Sitaram Mills formed part of the "assets in relation to the textile undertaking" under sub‑section (2) of section 3 of the Textile Undertakings (Taking Over of Management) Act, 1983. The mill, a sick textile undertaking, had been disposing of surplus l…

The appellant, widow of the original assessee, filed KVSS declarations for three assessment years and obtained a certificate under Section 90(1) of the Kar Vivad Samadhan Scheme determining tax arrears, followed by a Section 90(2) certificate granting immunity. After depositing the assessed amount, the Revenue issued a…

The Commissioner of Income Tax, Shillong appealed against the order of the Income Tax Officer (ITO) who had reopened the assessment of Tarajan Tea Co. (P) Ltd. under Section 147(a) of the Income Tax Act, 1961, on the ground that a decision in another tea company case—holding that the sale of standing trees was a revenu…

SUGAULI SUGAR WORKS (P) Ltd., a private limited company, transferred Rs 3,45,000 from a suspense account to its capital reserve account for the assessment year 1965‑66. The Income Tax Officer included Rs 2,56,529 in the assessee's total income under Section 41 of the Income‑Tax Act, treating the transfer as a benefit o…

The S.R.M.M.CT.M. Tiruppani Trust, a charitable trust for temple repairs and related activities, resolved in 1963 to accumulate its income for ten years and filed Form 10 under Section 11(2) of the Income‑Tax Act. In the assessment year 1970‑71 it realised Rs 8 lakhs from an advance to a firm, which it used to purchase…

The Supreme Court considered appeals by the Commissioner of Income‑Tax against shareholders of the liquidated Tinnevelly Motor Service Company who had received dividends from the liquidator. The revenue argued that amounts assessed under Section 41(2) of the Income‑Tax Act, 1961 – representing excess on the written‑dow…

The plaintiff sought recovery of a sum and, during trial, obtained court summons for the Income Tax Department to produce assessment records of the defendants for years 1964-65 to 1971-72. The Department produced the records in sealed covers, claiming privilege under the then‑applicable Section 137 of the Income Tax Ac…

The appellant, Gopal and Sons (a Hindu Undivided Family), had subscribed to shares of a fertilizer company, with the share certificates issued in the name of its Karta but the HUF shown as the beneficial and registered shareholder in the company's annual returns. The Assessing Officer added Rs. 1,20,10,988 as deemed di…

The Supreme Court examined whether Infosys Technologies Ltd. was required to deduct tax under Section 192 of the Income Tax Act on the benefit employees derived from an Employees Stock Option Scheme (ESOP) for the assessment years 1997-98, 1998-99 and 1999-2000. The Court held that, at that time, there was no provision…

Ishika Wajma‑Harima Heavy Industries Ltd., a Japanese company, entered into a turnkey LNG project contract with Petronet LNG Ltd. that involved offshore supply of equipment, offshore services, onshore supply, onshore services and construction. The company sought an advance ruling on whether the amounts received for off…

Ralson Industries Ltd filed its return for AY 1992‑93 reporting income of Rs.26,66,355. The assessing officer, under section 143(3), assessed income at Rs.35,40,414. The Commissioner invoked section 263, set aside the assessment and directed a fresh assessment, excluding transport receipts and interest under sections 8…

The appellant, an Assistant Engineer of Southern Railway, was found with Rs.2,94,615 in cash during a CBI raid and was charged under Sections 5(1)(e) and 5(2) of the Prevention of Corruption Act for possessing assets disproportionate to his known income. He claimed the cash represented loans of Rs.2,50,000 from two mon…

The Supreme Court entertained a public‑interest writ under Article 32 filed by Common Cause seeking remedial measures for the serious deficiencies in India’s blood‑banking system. A 1990 consultancy report highlighted widespread unlicensed banks, reliance on professional donors, inadequate testing, poor equipment and h…

The Commissioner of Income Tax (IT‑4) Mumbai challenged an order of the Income Tax Appellate Tribunal (ITAT) that, under Section 254(2) of the Income Tax Act, recalled its earlier 2013 order favoring the Revenue in a dispute with M/s Reliance Telecom Ltd over the taxability of software payments. The Supreme Court held …

The Karnataka Small Scale Industries Development Corporation Ltd. and several other companies were assessed under Section 115‑J of the Income‑Tax Act, 1961, which imposes tax at 30 % of book profit when the normal taxable income is less than that threshold. The assessee‑companies claimed that deductions such as depreci…

The Revenue sought clarification of the Supreme Court’s earlier judgment (19 Oct 2022) in Civil Appeal No. 21762/2017, which interpreted Section 2(15) of the Income‑Tax Act, 1961 with respect to charitable trusts engaged in activities of public utility. The clarification was requested on the ground that paragraphs 253 …

The respondents, manufacturers of textile fabrics, were found to have cleared goods without paying excise duty and were served a show‑cause notice on 6 January 1999. They sought relief under the Kar Vivad Samadhan Scheme, 1998, which allowed settlement of tax arrears quantified or notified on or before 31 March 1998, b…

The Supreme Court examined a batch of appeals concerning reassessment notices issued by the Revenue after the Finance Act 2021 amended Sections 147‑151 of the Income Tax Act, 1961. The Court considered whether the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) and its notifica…

The Calcutta Club, a Section 25 company operating as a members' club, was served with a notice for non‑payment of sales tax on food and drinks supplied to its permanent members. The Club argued that, under the doctrine of mutuality, no sale occurred because the supplier and the buyer were the same persons, a view uphel…

The Mumbai Metropolitan Region Development Authority (MMRDA) entered into a monorail contract with a consortium comprising Larsen & Toubro (India) and Scomi Engineering Bhd (Malaysia). Disputes over interim claims led the consortium to file a petition under Section 11 of the Arbitration and Conciliation Act, 1996, asse…

The Supreme Court examined whether an amendment to the Air India Employees Self‑Contributory Superannuation Pension Scheme, made on 3 April 2002, could be applied retrospectively to retirees whose annuity rights had already crystallized. The Court held that the right to receive an annuity and its quantum become fixed a…

The respondent, a public charitable trust, filed its 1994-95 return showing a gross income of Rs 99,41,221 and claimed a nil taxable income by deducting the amount actually spent on its objects (Rs 47,27,533) and an additional sum of Rs 32 lakh that it set apart for future charitable purposes. The Assessing Officer all…

Gujarat Urja Vikas Nigam Limited (GUVNL) entered into power purchase agreements (PPAs) with four wind‑energy companies, fixing a tariff of Rs 3.56 per kWh that was applicable only to projects availing accelerated depreciation under the Income‑Tax Act. The respondents later approached the Gujarat Electricity Regulatory …

The assessees, Mis. Hindustan Petroleum Corporation Ltd., engaged in bottling liquefied petroleum gas (LPG) into cylinders for domestic use and claimed deductions under Sections 80HH, 80‑1 and 80‑IA of the Income Tax Act, 1961. The Assessing Officer disallowed the claim, holding that bottling did not amount to ‘manufac…

Hyundai Corporation entered into a contract with Oil and Natural Gas Corporation (ONGC) for offshore oil exploration, which contained Clause 13.2.8 (sub‑contractor liability) and Clause 17.3 (indemnity for costs arising from a change of law). A change in Indian tax law – Section 44BB/4488 of the Income Tax Act, 1961 – …

For the assessment years 1987-88 and 1988-89 the Assessing Officer added income to Mis. Durga Engineering and Foundry Works under Section 68, treating certain cash credits as unexplained. The Commissioner upheld the additions, but the Income Tax Appellate Tribunal set aside the assessments and directed a fresh order. T…

The Supreme Court examined a garnishee order issued under section 226(3)(x) of the Income Tax Act, 1961, which sought payment of Rs.8,56,377.55 despite the notice specifying only Rs.2,86,450. The Court held that because the amount in the order was not mentioned in the notice, the garnishee order was a nullity and any s…

Brij Mohan, a partner in two firms, filed his 1964-65 income tax return late in April 1968, disclosing income from one firm but concealing income from the other. The Income Tax Officer, upon discovery, imposed a penalty under Section 271(1)(c)(iii) as amended by the Finance Act 1968, which allowed a penalty up to twice…

Mis. Palam Gas Service, engaged in LPG cylinder business, received freight payments from Indian Oil and paid subcontractors but failed to deduct tax at source under Section 194C. The Assessing Officer disallowed the subcontractor payments as per Section 40(a)(ia) of the Income Tax Act, 1961. The appellant challenged th…

The Supreme Court heard an appeal by the wife, daughter and mother of a 28‑year‑old Assistant Engineer who died in a motor accident caused by the negligent driver of a jeep. The Motor Accident Claims Tribunal had reduced the deceased's salary, deducted amounts for provident fund, pension, insurance and income tax, and …

The Adityapur Industrial Area Development Authority (the Authority) challenged a notice issued by the Income Tax Department requiring the bank to deduct TDS on interest earned on its fixed deposits, arguing that its income was exempt under Article 289 of the Constitution and Section 10(20) of the Income Tax Act as a lo…

The Revenue, represented by the Assistant Director of Inspection Investigation, challenged the constitutional validity of Sections 269SS, 271D (and the earlier 276DD) of the Income Tax Act, 1961, which penalise borrowers for taking loans or deposits in cash while exempting lenders. The High Court had quashed the prosec…

The appellant New Delhi Television Ltd. challenged a notice issued under section 147 of the Income Tax Act alleging that undisclosed income had escaped assessment. The Court examined whether the revenue had a prima facie reason to believe such escapement, whether the assessee had fully disclosed all material facts, and…

The Director, Prasar Bharati (Doordarshan) entered into agreements with several advertising agencies, paying them a 15% commission on advertising revenue for the assessment years 2002‑03 and 2003‑04. The Assessing Officer held that the payments fell within the definition of "commission" under Section 194H of the Income…

The Orissa Olympic Association (OOA) was granted a lease of 20.808 acres for a stadium but later constructed 23 shops and a Kalyan Mandap (Barabati Palace) on land the State claims lies outside the lease. The Supreme Court, after a committee measured the leasehold area, found that the shops and part of the Mandap are o…

The appellants, who were tenants of premises mortgaged to banks, challenged the seizure of those premises by the secured creditors under the SARFAESI Act. The Supreme Court examined whether a lease made by the mortgagor, either before or after the mortgage, remains valid and binding on the secured creditor, and whether…

Godhra Electricity Co. Ltd., a licensee under the Electricity Act, raised electricity rates but could not recover the increased charges because of protracted consumer litigation, a government advisory to maintain status quo, and a takeover of its undertaking under the Defence of India Rules. The Income Tax Officer had …

The appellants, non‑resident ship owners, had tax assessed on their shipping earnings under Section 172(4) of the Income Tax Act, 1961 and paid the tax. They later exercised their right under Section 172(7) to obtain a regular assessment, which showed that the tax previously paid was in excess. The Income Tax Appellate…

The appeal filed by Sri Nandlal Tejmal Kothari before the Supreme Court challenged an order of compulsory purchase of his property made under the Income Tax Act, 1961. The appellant contended that the order was arbitrary and that the statutory period for payment of consideration under Section 269‑UD(l) was not being co…

The case concerned penalty proceedings for the assessment year 1972-73 that had been referred to the Inspecting Assistant Commissioner (IAC) under Section 271(1)(c) and Section 274(2) of the Income Tax Act. The Taxation Laws (Amendment) Act, 1975 deleted sub‑section (2) of Section 274 with effect from 1 April 1976. The…

Burn Standard Company Ltd., a Government undertaking, entered into a technical collaboration agreement with McDermott International Inc. to obtain foreign technical know‑how, requiring RBI permission under Section 28(1)(b) of the Foreign Exchange Regulation Act, 1973 (FERA). The agreement received approval from the Sec…

Moriroku UT India (P) Ltd., a manufacturer of plastic automobile components, received tools, dies and moulds free of cost from its customer Honda Siel Cars India Ltd. to produce components. The Uttar Pradesh Tax Department levied trade tax under Section 3 of the U.P. Trade Tax Act, 1948 on the amortisation cost of thes…

Rekha Mukherjee, the owner of a property, filed a title suit for eviction against Ashis Kumar Das and others. The respondents filed a suit for specific performance of three sale agreements, which the appellant later cancelled; the trial court dismissed the specific‑performance suit. The respondents obtained a partial r…

The assessees Chhathu Ram and others were assessed under the Indian Income Tax Act, 1922 for the year 1942-43, which included cash credits that were also taxed under the Excess Profits Tax Act. While appeals against the inclusion of these cash credits were pending, the assessees applied for and obtained a settlement un…

The appellant, a Hindu undivided family (HUF) consisting of Apoorva Shantilal Shah, his wife and two minor sons, sought recognition of two partial partitions of shares in Gujarat Steel Tubes Ltd. under Section 171 of the Income‑Tax Act, 1961. The Income‑Tax Officer refused, and the matter progressed through the appella…

The appellant, a member of Raia Village Panchayat in Goa, was disqualified by the State Election Commission under Section 10(f) of the Goa Panchayat Raj Act, 1994 because her husband secured a contract with the same Panchayat for collection of market fees. The appellant challenged the disqualification, arguing that mer…

The Supreme Court examined a private limited company's claim for deduction of interest on loans taken to purchase rubberised machinery for the assessment years 1972‑73 to 1974‑75. The machinery had not been put to use and no depreciation was claimed, prompting the Income Tax Officer to disallow the interest deduction a…

Continental Construction Ltd., a civil construction company with overseas projects, paid remuneration to its directors, some of whom were also employees posted outside India. The Income‑Tax Officer disallowed amounts exceeding the Rs 72,000 ceiling per director under sections 40(c) and 40A(5)(a) of the Income‑Tax Act, …

Muthoot Leasing and Finance Ltd and another, classified as credit institutions, challenged the levy of interest tax on the interest component embedded in hire‑purchase instalments under the Interest‑Tax Act, 1974. The Income Tax Appellate Tribunal (ITAT) held that hire‑purchase agreements are composite transactions wit…

The Kerala State Beverages Manufacturing & Marketing Corporation Ltd (KSBC), a state‑owned liquor undertaking, challenged the disallowance of various levies under Section 40(a)(iib) of the Income‑Tax Act, 1961. The issues were whether the gallonage fee, licence fee and shop‑rental (kist) for FL‑9 and FL‑1 licences are …

Ravi Agrawal, a differently‑abled petitioner, filed a public‑interest writ under Article 32 seeking to compel the Union of India and LIC to allow annuity or lump‑sum payments from the Jeevan Aadhar insurance scheme to disabled dependents even while the parent/guardian is alive. The petitioner relied on a 2008 CBDT circ…

Indian Shaving Products Ltd., the parent of the sick subsidiary Sharp Edge Ltd., obtained BIFR approval for an amalgamation scheme under the Sick Industrial Companies (Special Provisions) Act, 1985, but BIFR refused to grant the tax benefit under Section 72A of the Income Tax Act. The appellant challenged this refusal …

The Income Tax Officer appealed against the deduction claimed by Arihant Tiles & Marbles (P) Ltd. under Section 801A of the Income Tax Act, 1961 for the assessment year 2001‑2002. The assessee converted raw marble blocks into polished slabs and tiles through a series of processes – sorting, sawing, cutting, crack‑filli…

The assessee, Shree Man. Junathesware Packing Products and Camphor Works, constructed a cinema theatre and claimed a certain cost in its return for AY 1977‑78. The Income‑Tax Officer (ITO) passed an assessment based on the assessee’s figure because the Departmental Valuation Officer’s (DVO) report was not available at …

M. Venkatraman, a public limited company engaged in tobacco export, remitted part of its sale proceeds to a Singapore party in violation of the Foreign Exchange Regulation Act, 1947 (FERA) and was penalised Rs.35,000. The company claimed a deduction of Rs.2,95,000 as business expenditure/loss in its 1970-71 income‑tax …

The assessee, a partnership firm dealing in shares, bought all equity shares of a company in 1945 and treated those shares as stock-in-trade for tax purposes. When the company was liquidated, the liquidator distributed a surplus to the shareholders, and the assessee received Rs. 32,25,550. The Income Tax Officer includ…

The assessee earned long‑term capital gains in the accounting year relevant to AY 1970‑71 and had a carried‑forward long‑term capital loss from earlier years. He claimed a deduction under Section 80T of the Income‑Tax Act on the basis that the deduction should be computed on the gross capital gains before the loss was …

The appellant complained to the Lokayukta that three government officials had caused a loss of Rs.4 crore to the State of Madhya Pradesh by purchasing land at inflated prices. The Lokayukta police investigated, exonerated the officials and filed a closure report under Section 169 of the Cr.P.C. before the Special Judge…

Enron Oil & Gas India Ltd (EOGIL), a foreign company and operator under a Production Sharing Contract (PSC) with the Government of India, claimed foreign exchange losses arising from currency translation of cash calls and expenses in its profit and loss account for AY 1999‑2000. The Assessing Officer disallowed the ded…

Mahindra & Mahindra Ltd. (M&M) sought a declaration under Section 72A of the Income‑Tax Act, 1961, to carry forward the accumulated loss and unabsorbed depreciation of International Tractor Company of India Ltd. (ITCI) after their amalgamation. The Specified Authority, after a screening committee, recommended that ITCI…