This Digest of case laws is prepared by KSA Legal and AIFTP from judgements reported in BCAJ, CTR, DTR, ITD, ITR, ITR (Trib), Chamber's Journal, SOT, Taxman, TTJ, BCAJ, ACAJ, www.itatonline.org and other journals
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S. 9(1)(vii) : Income deemed to accrue or arise in India-Fees for technical services-Singapore based company-Business of providing/sub-licensing software and earned revenue from maintenance services and training services provided to its Indian customers-Income of assessee from rendering said services would not fall within ambit of FTS and was not taxable in India-DTAA-India-Singapore. [S. 9(1)(vi), Art. 12]

DCIT (IT) v. Murex Southeast Asia (P.) Ltd. (2025) 212 ITD 592 (Mum) (Trib.)

S. 9(1)(vi) : Income deemed to accrue or arise in India-Royalty-Subscription revenue from Indian customers for providing access to online chemistry databases and from sale of online journals-Not assessable as royalty-DTAA-India-USA [S. 9(1)(vii), 147, 148, Art. 12(3)]

American Chemical Society v. DCIT (IT) (2025) 212 ITD 599 (Mum) (Trib.)

S. 9(1)(iv) : Income deemed to accrue or arise in India – Dividend by Indian company -Domestic company paying dividend distribution tax, only then, domestic company can claim benefit of DTAA, if any- Claim for first time before DRP – Claim cannot be rejected – DTAA -India – UK. [S.115O, 144C, Art. 11]

JC Bamford Excavators Ltd. v. ACIT (IT) (2025) 212 ITD 321 (Delhi) (Trib.)

S. 2(14)(iii) : Capital asset-Agricultural land- Distance between municipal limit and agricultural land was to be measured having regard to shortest road distance and not aerial distance- Agricultural land was situated beyond 8 kilometers of municipal limit- Not capital asset eligible for exemption- land sold was not a capital asset under section 2(14), provisions of section 50C would not apply.[S.2(14)(iiib) 45, 50C]

Kanchanben Maheshbhai Patel. v. ITO (2025) 212 ITD 133 (Surat) (Trib.)

S. 148A : Reassessment-Conducting inquiry, providing opportunity before issue of notice- Faceless regime – Jurisdiction of JAO – Notice after three years-Sanction of Specified Authority-Approval to be obtained from Principal Chief Commissioner-Approval from Principal Commissioner-Sanction is invalid-Order and consequent notice is invalid S. 148 – SLP of revenue was dismissed for failure to explain the delay and also on merits . [S. 147, 148A(b) 148A(d) 151(i), 151(ii) 151A, Art. 136 ]

ITO v. Prakash Pandurang Patil (SC) www. itatonline .org . Editorial: affirming Prakash Pandurang Patil v. ITO. (Bom)(HC), WP No. 10749 of 2024, dt. 12-08-2024.

S. 147 : Reassessment – Validity of notices issued under old regime after 01.04.2021 – Limitation and sanction under new regime- Considering the surviving time available – limitation under S.149 had expired or sanction under S.151 of appropriate authority was lacking, the reassessment notices were invalid. [S. 148, 148A, 149, 151, Art. 226 ]

Dhanraj Govindram Kella v. ITO (Guj)(HC) www.itatonline .org .

S. 68 : Cash credits – Penny Stock – Loss – Bogus claim of loss on trading of shares – Principles of natural justice – Tribunal erred in relying on coordinate bench decision without examining facts – Organized tax evasion -Exception to CBDT Circular No. 5 of 2024 dt .15 -3 -2024, para 3.1 (h) (2024) 462 ITR 273 (St), applies- Monitory limits is not applicable – Order of the Tribunal was set aside – Substantial question of law was answered in favour of revenue . [S. 143(2), 142(1), 143(3), 254(1) 260A, 268A ]

PCIT (Central-2), Kolkata v. Zulu Merchandise Pvt. Ltd ( 2025) 177 taxmann.com 160 (Cal )( HC) Editorial: Zulu Merchandise (P.) Ltd.v. ITO [ITA No. 553/Kol/2024 dated 23-09-2024] (Para 22) Reversed. The Calcutta High Court has reinforced its earlier ruling in Swati Bajaj that penny stock transactions lacking commercial rationale must be tested on human probabilities and can be disallowed even if routed through stock exchange, Demat and banking channels. The judgment is significant as it clarifies that such cases constitute “organized tax evasion” falling under the exception to CBDT’s low tax effect circulars, enabling Revenue appeals irrespective of monetary limits.

Prohibition of Benami Property Transactions Act, 1988
S. 2(8): Benami property-Provisions of 1988 Act (Ss. 3 & 5) prior to 2016 amendment unconstitutional-SLP not maintainable-Review dismissed.[S. 3, 5, Art. 136]

DCIT v. Kokilaben Chhaganbhai Patel (2025) 343 CTR 280 / 247 DTR 297 / 174 taxmann.com 796 (SC) Editorial : UOI v. Ganpai Dealcom (P) Ltd (Review Petn. (Civil) No. 359 of 2023 in Civil Appeal No. 5783 of 2022, review petition was declined.

Direct Tax Vivad Se Vishwas Act, 2020.
S. 2(j): Disputed tax-Only 50% payable where appeal is decided in Revenue’s favour-Higher demand illegal-Fresh Form-3 was directed to be issued. [S. 3(1), Art. 226]

PCIT v. Mangalore Refinery & Petrochemicals Ltd. (2025) 343 CTR 153 / 246 DTR 121 / 171 taxmann.com 622 (Karn)(HC)

S. 264 :Commissioner-Revision of other orders-Valuation of property-Income from other sources-Stamp valuation-Authorised representative wrongly admitted the addition-No objection was raised before the Assessing Officer prior to the assessment order being passed-Assessee entitled to raise objections before revisional authority or before the CIT(A)-Commissioner’s rejection set aside. [S. 50C(2), 56(2)(vii)(b)(ii), 246A, Art. 226]

R.C. Kannan v. PCIT (2025) 343 CTR 369 / 246 DTR 137 / 170 Taxmann.com 380 (Mad)(HC) Kannan Manomani (Smt) v. ACIT (2025) 343 CTR 369 / 246 DTR 137 / 170 Taxmann.com 380 (Mad)(HC)