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. 54EC: Capital gains-Investment in specified bonds-Investment made before sale of property-Exemption restricted to capital gain available on date of investment. [S. 45, 260A]
CIT v. K. Kumaran [2025] 173 taxmann.com 838 / (2026) 349 CTR 343 (Mad)(HC).
S. 45 : Capital gains: Computation-Sale consideration-Assessing Officer entitled to substitute actual consideration for consideration stated in sale deed when supported by evidence.[S.48, 260A]
Inderpal Singh Ahuja v. AO (2026) 349 CTR 724 (P&H)(HC). ACIT v.Inder Pal Singh Ahuja (2026) 349 CTR 724 (P&H)(HC).
S.43B: Deductions on actual payment-Explanation 5 to S. 43B, which was inserted by Finance Act, 2021 with effect from 1-4-2021 is clarificatory in nature and would apply retrospectively-Due date fell on a date which was a National Holiday, i.e., 15-8-2018, deposit could have been made by assessee only on date which followed National Holiday, i.e., 16-8-2018-the amount deposited on 16-8-2018 was to be allowed as deduction to assessee.[S. 36(i)(va), 139(1), 143(1(a)]
Woodland (Aero Club) (P) Ltd. v. Asstt. CIT (2025) 178 taxmann.com 207/ (2026) 349 CTR 65 (Delhi)(HC)
S. 40(a)(ia): Amounts not deductible-Deduction at source-Contractors-Payments were not linked to actual expenses supported by bills and constituted contractual payments attracting TDS under section 194C-Disallowance under section 40(a)(ia) was justified. [S.194C]
Deys Medical (U.P.) (P) Ltd. v. PCIT (2026) 349 CTR 233 / 310 Taxman 14(Cal)(HC)
S. 10(10AA): Leave salary-Employee of the Central Government or State Government-Leave encashment-Employees of BSNL absorbed from Central Government service-Retirement to be treated as retirement from Central Government service-Exemption allowable. [CCS (Pension) Rules, 1972, Rule 37A(4), (8), Art. 226]
Sanchar Nigam Pensioners Welfare Association (SNPWA) v. UOI (2026) 349 CTR 706 (Ker)(HC).
S. 4: Charge of income-tax-Agricultural income-Tea cultivation-Applicability of amended provision-The law applicable is the law in force in the relevant assessment year unless the amendment is retrospective. [Assam Agricultural Income-tax (Amendment) Act, 2009, S. 8B]
Mcleod Russel India Ltd. v. State of Assam (2026) 349 CTR 497 (FB)(Gauhati)(HC).
S.2(14)(iii): Capital asset-Agricultural land-Capital gains-Land situated beyond 8 kms. from municipality-Agricultural land excluded from the definition of capital asset. [S. 45, 260A]
CIT v. K. Kumaran [2025] 173 taxmann.com 838 / (2026) 349 CTR 343 (Mad)(HC).
S.68: Cash credits – Share capital and share premium – Identity, genuineness and creditworthiness of subscriber established – Assessee issued 22,50,000 equity shares of face value ₹10 at ₹50 per share, including premium of ₹40 –Merely because shares were issued at a high premium, addition under section 68 could not be made – Second proviso to section 68 inserted w.e.f. 1-4-2013 – A.Y. 2012-13 – Even assuming applicability, factual requirement stood satisfied as subscriber had explained source of investment received from group companies – No substantial question of law arose – Revenue’s appeal dismissed. [ S. 260A ]
PCIT-6, Mumbai v. Essar Agrotech Ltd. (Bom.)(HC) [www.itatonline.org
S.45: Capital gains – Co-operative housing society – Redevelopment of property – Development Agreement entered into by society on behalf of its members – Society continued to be owner of land – No consideration received by society – Developer entered into Permanent Alternate Accommodation Agreements with individual members – Society merely acted as representative of members – Capital gains arising from redevelopment transaction, if any, taxable in hands of individual members and not in hands of society – Addition made in hands of society deleted. [ S.2(47), 143(3), Maharashtra Co-operative Societies Act, 1960, S.79A .]
Hardinge House Co Op Hsg Soc. Ltd. v. ITO (Mum.)(Trib.) [www.itatonline.org]
S.264: Commissioner – Revision of orders – Assessment – Addition under section 69 – Cost imposed Rs .1 lakh – Redevelopment of property – Permanent Alternate Accommodation Agreements entered into with existing tenants – Assessee contending that PAAA’s were entered into to allot area to existing tenants in lieu of their existing area, free of cost – Assessment completed under section 143(3) read with section 144B by adding ₹4.24 crore as unexplained investment under section 69 – In revision proceedings, assessee produced only Index-II and failed to produce PAAA’s, MHADA permission and other supporting evidence – Revision application dismissed – High Court restored revision proceedings to Revisional Authority to enable assessee to produce complete evidence and fresh order – Subject to payment of costs of ₹1 lakh – Order passed in peculiar facts and not to be treated as precedent. [ S.69, 143(2), 143(3), 144B, 264, 43CB .]
Shree Yashraj Real Estate Developers Pvt. Ltd. v. ACIT (Bom.)(HC) [www.itatonline.org]