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. 40(a)(ia): Amounts not deductible-Deduction at source-Short deduction of tax at source-Merely a short deduction of TDS by assessee under section 194C, and persons to whom payments were made by assessee had paid taxes on such payments, Assessing Officer could not have invoked provisions of section 40(a)(ia) and disallowed expenses claimed by assessee-Order of Tribunal affirmed. [S. 194C; Second proviso, 194I, 260A]
PCIT v. Morgan Stanley India Capital Pvt Ltd [2025] 177 taxmann.com 699 (Bom) (HC)
S. 37(1): Business expenditure-Infrastructure fee-Advertising receipts-Tribunal was justified in restricting deduction to 5 per cent of actual receipts in accordance with the agreement and not on the gross advertising bill-Order of Tribunal affirmed. [S.145, 260A]
Star Time Communication (I) (P.) Ltd. v. CIT [2025] 174 taxmann.com 753 (Bom)(HC)
S. 37(1): Business expenditure-Personal element-Disallowance-Pure finding of fact-Commission payment-Services not established-Finding of fact-No substantial question of law.[S.260A]
Saigal Sea Trade v. ACIT [2025] 176 taxmann.com 75 (Bom) (HC).
S. 37(1) : Business expenditure-Client assistant charges-Three-in-one account scheme-Expenditure incurred for business allowable-Provision for loss-Contingent liability-Conservative principle-Deduction allowable [S. 145, 260A]
PCIT v. ICICI Securities Ltd. [2025] 174 taxmann.com 160 (Bom) (HC)
S. 36(1)(vii) : Bad debt-Advances-Business loss-Write-off of unrecovered advances-Genuineness not disputed-Deduction allowable. [S,28(i), 260A]
PCIT v. Watson Pharma (P.) Ltd. [2025] 173 taxmann.com 957 (Bom) (HC)
S.14A: Disallowance of expenditure-Exempt income-Interest-free funds-Non-interest-bearing funds were more than the investment made in tax-free securities; it would be presumed that the investment made by the assessee would be from its interest-free funds and, thus, no disallowance under section 14A could be made-Order of Tribunal affirmed. [S.260A, Rule 8D]
PCIT v. Morgan Stanley India Capital Pvt Ltd [2025] 177 taxmann.com 699 (Bom) (HC)
S. 10A: Free trade zone-STP Unit-New infrastructure, plant and machinery, software and separately recruited workforce-Undertaking not formed by splitting up or reconstruction of existing business-Deduction allowable-Order of Tribunal affirmed. [S. 10A(2), 260A]
PCIT v. Mahindra Engineering Services Ltd. [2025] 180 taxmann.com 759 (Bom)(HC)
Direct Tax Vivad Se Viswas Act, 2024.
S 91 : Filing of declaration and particulars to be furnished-Prior tax position revived when assessee does not comply with provisions / requirements of DTVSV Act 2020 and hence eligible under DTVSV Act 2024.[DTVSV Act, 2020, S. 4(6), 5(1)Art. 226]
Vidya Sagar Sharma v. UOI(2026) 349 CTR 121 /184 taxmann.com 44 (J&K)(HC)
S. 276C : Offences and prosecutions-Wilful attempt to evade tax-When the subject matter of the penalty, which was the very basis on which criminal proceedings had been launched, was set aside, criminal proceedings could not be allowed to continue.[S.271(1)(c), 277]
Shiv Kumar Jaiswal v. State of UP. (2026) 349 CTR 228/ 182 taxmann.com 684 (All)(HC)