This yearly roundup covers the most significant tax law developments in 2025, including landmark judicial decisions of the Supreme Court, High Courts and Tribunals, major legislative reforms, and key policy clarifications affecting direct and indirect taxation in India.
BIGGEST TAX LAW STORY OF 2025
A New Era in Taxation: Income Tax Act, 2025 Replaces more than 60-Year-Old Law
On 21-8-2025, the Ministry of Law and Justice notified the Income-tax Act, 2025 to repeal the 6-decade old Income-tax Act, 1961. The new Act consolidates and restructures all the provisions in sequence. The provisions will come into force on 1-4-2026. Read more HERE
LEGISLATIVE DEVELOPMENTS IN TAX LAW
Manipur Goods and Services Tax (Second Amendment) Act, 2025
On 10-12-2025, the Parliament passed the Manipur GST (Second Amendment) Act, 2025, since Manipur is currently under President’s rule. It aims to revise the Manipur Goods and Services Tax Act, 2017, introducing “unique identification marking” for goods, modifying provisions on local and municipal funds, and updating sections on tax liability, credit notes, and compliance. Key changes include conditions in section 39 for filing returns, new appeal rules requiring 10% penalty payment (sections 107 & 112), and insertion of section 122B imposing penalties for non-compliance with track-and-trace mechanisms. Section 148A introduces a system for affixing unique IDs on specified goods. Schedule III is amended to include SEZ and FTWZ supply provisions. Read about Parliament Winter Session 2025 HERE
Customs (Voluntary Revision of Entries Post Clearance) Regulations, 2025– Key Provisions & Compliance Guidelines
On 30-10-2025, the Central Board of Indirect Taxes and Customs notified the Customs (Voluntary Revision of Entries Post Clearance) Regulations, 2025 to facilitate compliance by allowing importers/exporters to voluntarily correct or revise customs declarations after clearance without facing punitive consequences. Read more HERE
GST (Fourth Amendment) Rules 2025: Electronic Registration, Aadhaar Authentication & New Threshold Options
On 31-10-2025, the Ministry of Finance notified the Central Goods and Services Tax (Fourth Amendment) Rules, 2025 to amend the Central Goods and Services Tax Rules, 2017. The provisions came into force on 1-11-2025. Read more HERE
CBIC Automates IFSC Code Approvals Across Ports to Boost Trade Efficiency
On 7-10-2025, the Central Board of Indirect Taxes and Customs (‘CBIC’) announced the launch of a system-based auto-approval mechanism for Indian Financial System Code (‘IFSC’) code registration. This initiative marks a significant step toward streamlining customs procedures and enhancing trade facilitation across India’s ports. Once an exporter’s bank details are approved at one port, they will now be automatically accepted at other ports as well, eliminating the need to repeat the registration process. Read more HERE
CBDT Update: New ITR Filing Deadline Announced for AY 2025—26
On 29-10-2025, the Central Board of Direct Taxes (‘CBDT’) announced the extension of key statutory due dates under the Income-tax Act, 1961 for the Assessment Year (AY) 2025—26. Read more HERE
GST Council’s 56th Meet introduces Key Slab Reforms and Tribunal Rollout — New GST Rates & FAQs Inside
On 3-9-2025, the Goods and Services Tax Council (‘GST Council’) held the 56th GST Council meeting chaired by Union Finance & Corporate Affairs Minister Smt. Nirmala Sitharaman, marking a transformative moment in India’s tax landscape. The Council unveiled a multi-sectoral reform agenda aimed at enhancing transparency, simplifying compliance, and promoting ease of doing business, especially for small traders and entrepreneurs. The revised GST rates will come into effect from 22-09-2025. Tobacco product rates will be notified separately due to pending cess issues. Read more HERE
New GST Rates effective from 22-9-2025: Major reform to ease consumer burden and simplify tax structure
On 17-9-2025, the Ministry of Finance notified the new rates of Goods and Services replacing the rates notified in the year 2017 on 28-6-2017 to streamline the tax structure and provide relief to consumers. The new rates will come into effect from 22-9-2025. Read more HERE
GST Overhaul: Revised IGST and UTGST Rate Structure
On 17-9-2025, the Ministry of Finance announced the revised tax rates under Integrated GST (‘IGST’) Rate and Union Territory (‘UTGST’) Rate. These redefined tax rate structures will take effect from 22-9-2025. Read more HERE
Next-Gen GST in Action: Goods and Services Tax Appellate Tribunal Launched for Fairness and Certainty
On 24-9-2025, the Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman formally launched the Goods and Services Tax Appellate Tribunal (‘GSTAT’), strengthening India’s Goods and Services Tax (‘GST’) framework and indirect tax dispute resolution. Read more HERE
Central GST Third Amendment Rules, 2025: Key Reforms and Implications
On 17-9-2025, the Ministry of Finance notified the Central Goods and Services Tax (Third Amendment) Rules, 2025, aimed at streamlining refund procedures, refining appellate mechanisms, and enhancing reporting formats in annual returns and reconciliation statements. This Amendment Rule will come into effect form 22-9-2025. Read more HERE
Relief for Taxpayers: CBDT Pushes Audit Filing Deadline to October-End
On 25-9-2025, the Central Board of Direct Taxes (‘CBDT’) announced an extension of the specified date for filing various audit reports for the Assessment Year 2025—26. The deadline now stands extended to 31-10-2025. Read more HERE
Taxation Laws (Amendment) Act, 2025
On 21-8-2025, the Central Government notified Taxation Laws (Amendment) Act, 2025, introducing key changes to the Income-tax Act, 1961 and the Finance Act, 2025. The Act seeks to provide tax exemptions for subscribers of the Unified Pension Scheme, including up to 60% of the corpus received from the National Pension System Trust at retirement, and lump-sum payouts as notified. It also clarifies tax treatment of pension transfers between individual and pool corpus. The Act extends eligibility for income-tax exemptions under section 10(23FE) to the Public Investment Fund of Saudi Arabia and its wholly owned subsidiaries. Section 80CCD is updated to define taxability of pension withdrawals and clarify definitions of salary and corpus types. Section 49 of the Finance Act, 2025 is amended to streamline block assessment procedures in search and requisition cases, ensuring that pending assessments automatically abate upon initiation of search or issue of notice. These changes aim to simplify pension taxation, attract foreign investment, and reduce litigation in tax administration. Introduced by the Lok Sabha on 11-8-2025, the Bill was passed by the Rajya Sabha on 12-8-2025. Read more HERE
Manipur Goods and Services Tax (Amendment) Act, 2025
On 7-8-2025, the Central Government notified the Manipur Goods and Services Tax (Amendment) Act, 2025, seeks to implement key decisions approved by the GST Council and replaces the earlier Manipur GST Amendment Ordinance, 2025. The Act allows Manipur to levy tax on un-denatured extra neutral alcohol used in liquor production, outside the central GST scope but taxable by states. Read about Monsoon Session of Parliament 2025 HERE
Inside Taxation Laws Amendment 2025: Unified Pension Reforms, Foreign Investment Exemptions, and Simplified Assessment Procedures
Inside Taxation Laws Amendment 2025: Unified Pension Reforms, Foreign Investment Exemptions, and Simplified Assessment Procedures. Read more HERE
A push towards Green Investments: IREDA bonds granted Section 54EC tax benefit status On 10-7-2025, the Ministry of Finance officially granted Section 54EC tax benefit status to Indian Renewable Energy Development Agency Ltd. (‘IREDA’) bonds. In a major boost to India’s renewable energy financing ecosystem, the Central Board of Direct Taxes (‘CBDT’) classified these instruments as ‘long-term specified assets’ under Section 54EC. Read more HERE
Income Tax Department: Verification operation to curb fraudulent ITR filing
On 14-7-2025, the Income Tax Department initiated a verification operation across multiple locations in the country, targeting individuals and entities facilitating fraudulent claims of deductions and exemptions in Income Tax Returns (‘ITR’) to curb misuse of tax benefits under Income-tax Act, 1961. Read more HERE
ITR Filing Deadline extended! CBDT pushes due date to 15th September 2025
On 27-5-2025, the Central Board of Direct Taxes issued extended the due date of filing of Income Tax Returns for the AY 2025-26 by 15-9-2025. This extension is expected to mitigate the concerns raised by stakeholders and provide adequate time for compliance, which will ensure the integrity and accuracy of the return filing process. Read more HERE
Rajasthan Goods and Services Tax (Second Amendment) Act, 2025
On 26-9-2025, the Rajasthan Government notified the Rajasthan Goods and Services Tax (Second Amendment) Act, 2025, introducing key changes to the principal Act of 2017. Sections 2(i) and 5 are deemed effective from 1 April 2025, while other provisions will come into force via official notification. The Act revises definitions (e.g., “local fund”, “municipal fund”, and “unique identification marking”), deletes sub-sections from Sections 12 and 13, and updates provisions in Sections 20, 34, 38, 39, 107, and 112. It introduces new Sections 122B and 148A to enforce a track-and-trace mechanism for certain goods. Amendments to Schedule III clarify tax treatment of supplies from SEZs and FTWZs. No refund will be issued for taxes collected prior to the enforcement of Section 13.
MoF streamlines the process of custom clearance of imports vide Postal Imports Regulations, 2025
On 28-3-2025, the Ministry of Finance notified the Postal Imports Regulations, 2025 to streamline the customs clearance process for international parcels arriving through Foreign Post Offices. Read more HERE
Govt mandates electronic filing of appeals vide GSTAT (Procedure) Rules, 2025 On 24-4-2025, the Ministry of Finance notified the Goods and Services Tax Appellate Tribunal (Procedure) Rules, 2025 to establish a structured and efficient framework for the functioning of the Goods and Services Tax Appellate Tribunal. Read more HERE
An attempt to replace 6-decade old Income-tax Act, 1961 for the benefit of taxpayers
The Union Finance Minister, Nirmala Sitharaman, proposed the new Income-tax Bill, 2025 proposing to repeal and replace the Income-tax Act, 1961. This effort is to make the Act concise, lucid and easy to read and understandable which will help in reducing disputes, litigations and provide clearer tax certainty to tax payers. Read more HERE
LANDMARK DIRECT TAX JUDGMENTS OF 2025
BOMBAY HIGH COURT | ‘Defeats the ends of justice’; ITAT’s order treating income from same source differently for different assessment years, set aside
In the present case, an appeal was filed by the assessee challenging the order of Income Tax Appellate Tribunal (‘ITAT’) which stated that the interest paid by the assessee to the bank for the funds borrowed, could not be set off against interest received by it, by lending part of the said borrowed funds to its sister concerns. The Division Bench of Alok Aradhe, CJ. and Sandeep V. Marne*, J., held that the ITAT could not be permitted to treat the income earned for the Assessment Year 1992-93 as “other sources” while treating the similar income in the succeeding Assessment Year 1993-94 under the head “business”. The Court opined that the order for Assessment Year 1992-93 needed to be brought in tune with its orders passed for subsequent years, which had attained finality, else it would defeat the ends of justice. Thus, the Court set aside the order of ITAT. [Modi Business Centre Pvt. Ltd v. CIT, 2025 SCC OnLine Bom 2968, decided on: 21-8-2025] Read more HERE
BOMBAY HIGH COURT | Assessee not ‘eligible’ under S. 144-C Income Tax Act, if no income variation made by Transfer Pricing Officer
In the writ petition challenging Draft and Final Assessment Order passed under Section 144-C of the Income Tax Act, 1961 (‘IT Act’) on the ground that the petitioner did not fall under the category of ‘eligible assessee’ under the said provision, as no income variation was made by the Transfer Pricing Officer (‘TPO’) in its order, the Division Bench of B. P. Colabawalla* and Amit S. Jamsandekar, JJ., stated that petitioner could be an ‘eligible assessee’ only if there was a case of variation which had arisen because of the order passed by the TPO. The Court stated that when there was no variation, there was no question of any prejudice being caused to the assessee which would then entail him to file any objections to the Draft Order as contemplated under Section 144-C(2) of IT Act. Therefore, the order passed was invalid. Hence, the Court quashed and set aside the Draft Assessment Order, the Final Assessment Order and the Demand Notice as well as the Show Cause Notices which sought to impose penalty on the petitioner. [Classic Legends Pvt Ltd v. CIT, 2025 SCC OnLine Bom 3331, decided on: 9-9-2025] Read more HERE
BOMBAY HIGH COURT | Income Tax Appeal involving tax effect less than Rs. 2 crores disposed of citing CBDT Circular
The instant appeal was filed by the Revenue (‘appellant’) and was properly instituted. However, the assessee prayed for it to be withdrawn on account of Central Board of Direct Taxes (‘CBDT’) Circular No. 5 of 2024 (‘2024 Circular’). The Division Bench of M.S. Sonak and Jitendra Jain, JJ., observed that since the 2018 Circular was superseded by the 2024 Circular and the tax effect involved was less than Rs 2 crore, therefore the appeal stood disposed of on account of the tax effect. [CIT v. Sulzer Pumps India Ltd., 2025 SCC OnLine Bom 2646, decided on 16-4-2025] Read more HERE
BOMBAY HIGH COURT | Approval under Section 153D of the Income Tax Act must reflect application of mind; Revenue’s appeal dismissed
While deciding an appeal under the Income Tax Act, 1961 (‘the Act’) challenging the validity of proceedings initiated under Section 153-C of the Act, the Division Bench of M.S. Sonak* and Advait M. Sethna, JJ., dismissed the appeal after holding that the approval granted under Section 153D of the Act was vitiated by non-application of mind. The Court noted that the approval dated 06-08-2010 did not reflect even a minimum application of mind and had been granted mechanically. Therefore, in the absence of a valid approval, the proceedings under Section 153C of the Act were incompetent. [CIT v. Vrushali Sanjay Shinde, 2025 SCC OnLine Bom 4960, decided on 10-12-2025] Read more HERE
PUNJAB AND HARYANA HIGH COURT | Bail plea filed directly before High Court can be entertained in exceptional circumstances’: Bail granted to Income Tax Officer in bribery case
In the present case, a petition filed by the petitioner, a senior Income Tax Officer, under Section 483 of the Bhartiya Nagarik Suraksha Sanhita, 2023 (‘BNSS’) for grant of regular bail in FIR registered for the offences punishable under Sections 61(2) and 308(2) of the Bhartiya Nyaya Sanhita, 2023 (‘BNS’) and Sections 7 and 7-A of the Prevention of Corruption Act, 1988 (‘1988 Act’). Single Judge Bench of Sumeet Goel, J., opined that there was no indefeasible right vested in the petitioner to approach the High Court directly for grant of regular bail bypassing the forum of Sessions Court. The Court held that a plea for grant of regular bail, filed straightaway before the High Court in the first instance, ought to be entertained only if there would be exceptional circumstances made out. Thus, the Court ordered the release of the petitioner on regular bail. [Amit Kumar Singal v. CBI, 2025 SCC OnLine P&H 5826, decided on 18-8-2025] Read more HERE
SUPREME COURT | Non-compete fee: Revenue or capital expenditure?
In a batch of appeals dealing with divergent views taken by various High Courts on a recurring question whether non-compete fees paid by an assessee amounts to revenue expenditure or capital expenditure, a Division Bench of Manoj Misra and Ujjal Bhuyan,* JJ., held that payment made by the assessee as non-compete fee is an allowable revenue expenditure under Section 37(1) of the Income Tax Act, 1961 (the Act). [Sharp Business System v. CIT, 2025 SCC OnLine SC 2892, Decided on 19-12-2025] Read more HERE
DELHI HIGH COURT | Deductibility of license fees paid by Remfry & Sagar for use of founder’s name and goodwill under Section 37 IT Act, upheld
Two appeals were filed by the Principal Commissioner of Income Tax questioning the correctness of the judgment rendered by the Income Tax Appellate Tribunal on 06-09-2016 pertaining to Assessment Year 2009-10 and order dated 26-07-2019 pertaining to AY 2011-12. A division bench of Yashwant Varma and Ravinder Dudeja, JJ., dismissed the appeals upholding the impugned orders and ruling that the license fees paid by law firm Remfry & Sagar for the use of its founder’s name and goodwill qualify as a legitimate business expense under Section 37 of the Income Tax Act. [Commissioner of IT v. Remfry and Sagar, 2025 SCC OnLine Del 490, decided on 31-01-2025] Read more HERE
TELANGANA HIGH COURT | Explained | “Open terrace”, “open portico” excluded to calculate built-up area for deductions under S. 80-IB of IT Act
In a batch of appeals filed by Appellant 1, Modi Builders and Realtors (P) Ltd. (‘the assessee’), under Section 260-A of the Income Tax Act, 1961 (‘the Act’), the Division Bench of P. Sam Koshy* and Narsing Rao Nandikonda, JJ., dealt with the question of law whether terrace or balcony in the form of open to sky or portico without walls would be added while computing the built up area for determining the eligibility for deduction under Section 80-IB(10) of the Act. The Court held that both “open terrace” and “open portico” have nowhere been mentioned to be a part of the built-up area as defined in Section 80-IB(14)(a). Thus, an open terrace could never be a balcony or a projection and similarly an open portico would never be included within the inner measurement of a residential unit. [Modi Builders & Realtors (P) Ltd. v. CIT, 2025 SCC OnLine TS 283, decided on 21-5-2025] Read more HERE
MADHYA PRADESH HIGH COURT | Expenditure on Overburden Removal is Capital Expenditure, hence not deductible under S. 37(1) of Income Tax Act
In a batch of Income Tax appeals filed by the Department of Income Tax against respondent-Northern Coalfields Ltd. (NCL), related to multiple assessment years raising substantial questions of law under Section 260-A of the Income Tax Act, 1961 (Income Tax Act), a Division Bench of Suresh Kumar Kait, CJ., and Vivek Jain,* J., partly allowed the appeals. The Court upheld the Tribunal’s orders in relation to education, community development, and other welfare expenditures. However, regarding deduction of Overburden Removal (OBR) expenses as revenue expenditure, the Court ruled in favor of the Revenue and held them as capital expenditure. [CIT v. Northern Coalfields Ltd., 2025 SCC OnLine MP 3439, Decided on 15-04-2025] Read more HERE
BOMBAY HIGH COURT | Advance/Loan amount used for purposes other than business execution is taxable as deemed dividend
In the present appeal, the appellant challenged the order passed by the Income-Tax Appellate Tribunal (‘ITAT’), which included the advance amount taken by him under the ambit of Section 2(22)(e) of the Income Tax Act, 1961 (‘Act’) as deemed dividend. The Division Bench of Alok Aradhe, CJ., and Sandeep V. Marne*, J., opined that utilization of advance for execution of a particular business transaction was a sine qua non for exclusion of the amount of loan or advance from the ambit of Section 2(22)(e) of the Act, therefore such advance in the instant case should be treated as deemed dividend. The Court thus dismissed the appeal and upheld the order of the ITAT. [Jaykumar B. Patil v. CIT, 2025 SCC OnLine Bom 2889, decided on: 7-8-2025] Read more HERE
INCOME TAX APPELLATE TRIBUNAL, MUMBAI | Revenue’s appeal against CIT(A)’s deletion of disallowance made against Aishwarya Rai Bachchan dismissed
The present appeal was filed by the Revenue against the order of the Commissioner of Income Tax (Appeals) (‘CIT(A)’), Mumbai, wherein the disallowance made by the Assessing Officer (‘AO’) under Section 14-A of the Income Tax Act, 1961 (‘the Act’) was deleted. The Bench comprising Pawan Singh (Judicial Member) and Renu Jauhri (Accountant Member) held that the disallowance made by the AO, over and above the suo-moto disallowance made by the assessee is without any basis and deserves to be deleted. Thus, the Tribunal dismissed the Revenue’s appeal. [ACIT v. Aishwarya Rai Bachchan, 2025 SCC OnLine ITAT 16115, decided on 31-10-2025] Read More HERE
SUPREME COURT | Hyatt International has ‘permanent establishment’ in India under India-UAE DTAA; liable to pay tax in India: Supreme Court upholds Delhi HC’s decision
The principle that arose for determination in the present case, was whether Hyatt International Southwest Asia Ltd. (‘Hyatt International’), a tax resident of the UAE, had a Permanent Establishment (‘PE’) in India under Article 5(1) of the Indo-UAE Double Taxation Avoidance Agreement (‘DTAA’), and whether its income derived under the Strategic Oversight Services Agreement (‘SOSA’) was taxable in India. The Division Bench of J.B. Pardiwala and R. Mahadevan*, JJ., stated that a detailed review of the SOSA executed between Hyatt International and Asian Hotels Limited, India (‘AHL’), demonstrated that the Hyatt International exercised pervasive and enforceable control over the hotel’s strategic, operational, and financial dimensions.
The Court stated that Hyatt International’s ability to enforce compliance, oversee operations, and derive profit-linked fees from the hotel’s earnings demonstrated a clear and continuous commercial nexus and control with the hotel’s core functions. Thus, the Court affirmed the findings of the Delhi High Court (‘High Court’), that Hyatt International had a fixed place PE in India within the meaning of Article 5(1) of the DTAA, and the income received under the SOSA was attributable to such PE, therefore taxable in India. [Hyatt International Southwest Asia Ltd. v. CIT, 2025 SCC OnLine SC 1506, decided on 24-7-2025] Read more HERE
SUPREME COURT | Head office expenditure of non-resident, incurred outside India, even if exclusively for Indian branches, fall within S. 44-C of Income Tax Act
In the appeals raising a common question concerning the interpretation of Section 44-C of the Income-tax Act, 1961 (the Act), a Divison Bench of J.B. Pardiwala* and K.V. Viswanathan, JJ., held that expenditure incurred by the head office of a non-resident assessee outside India, even if incurred exclusively for its Indian branches, constitutes “head office expenditure” within the meaning of Section 44-C of the Act, and the deduction in respect thereof is subject to the statutory ceiling provided under the said provision. [Director of Income Tax v. American Express Bank Ltd., 2025 SCC OnLine SC 2806, Decided on 15-12-2025] Read more HERE
RAJASTHAN HIGH COURT | ‘Sleeper Bus’ tax amendment by Transport department upheld
In a batch of writ petitions, challenging the amendment made by Transport Department by Notification dated 24-02-2021, whereby the Rajasthan Motor Vehicles Taxation Act, 1951 was amended by it introducing a new category of ‘Sleeper Bus’ at Serial No. 7(a)(iii), thereby imposing a separate levy based on body type of vehicle, a Division Bench of Vinit Kumar Mathur* and Justice Anuroop Singhi, JJ., upheld the amendment. The Court said that the amendment cannot be said to be anything beyond specifying the rate of motor vehicle tax payable on passenger vehicles, which was very much within the domain and authority of the State Government in exercise of powers conferred by Clause (a) and (c) of Sub-Section (1) of Section 4 read with Section 3 of the Rajasthan Motor Vehicles Taxation Act, 1951. It, further, observed that the rates of tax were amended keeping-in-mind the intelligible differentia of the class of vehicles and the area of their operation. Further, Government was fully competent to extend the benefit of exemptions to a particular category and deny the same to other, keeping-in-mind the larger public interest, the nexus and the object sought to be achieved. [Khuman Singh v. State of Rajasthan, 2025 SCC OnLine Raj 4092, decided on 22-08-2025] Read more HERE
CALCUTTA HIGH COURT | Eden Gardens Stadium not a ‘public place’; Kolkata Municipal Corporation’s ₹51 Lakh Tax demand on Cricket Association of Bengal, quashed
In an appeal filed by Calcutta Municipal Corporation (appellants) challenging the judgment and order dated 24-04-2015, whereby the petition of the Cricket Association of Bengal (respondent 1) was allowed, the Division Bench of Arijit Banerjee and Kausik Chanda, JJ., dismissed the appeal and upheld the decision of the Single Judge quashing a demand notice dated 27-03-1996, whereby the Kolkata Municipal Corporation had levied advertisement tax of Rs. 51,18,450/- on the Cricket Association of Bengal under Section 204 of the Kolkata Municipal Corporation Act, 1980. [Calcutta Municipal Corporation v. The Cricket Association of Bengal, 2025 SCC OnLine Cal 4970, decided on 19-06-2025] Read more HERE
INCOME TAX APPELLATE TRIBUNAL | Notice to deceased assessee must first be served on legal heirs; once on record, legal heirs represent deceased assessee
The present appeal was filed by the daughter of the deceased assessee against the impugned order passed by Commissioner of Income Tax (Appeals), (‘Commissioner’) whereby the appeal was dismissed on the ground that the legal heirs have not been brought on record, and the appeal could not have been filed by the deceased person. The two-Member Bench of George Mathan (Judicial Member) and Sanjay Awasthi (Accountant Member), stated that the notice in respect of deceased assessee was to be served on legal heirs first and it was after that the legal heir so specified and brought on record, would represent on behalf of the deceased assessee. The Tribunal observed that no action was taken by the Assessing Officer to issue fresh notice in the name of the legal heir. Thus, the Tribunal quashed the notice issued to assessee under section 148 of the Income Tax Act, 1861 and other consequential assessment orders. [Lily Sarkar v. CIT, 2025 SCC OnLine ITAT 10033, decided on 3-9-2025] Read More HERE
KERALA HIGH COURT | Penalty for delay in filing audit report before assessing authority under IT Act can be avoided by demonstrating reasonable cause
A division bench of A.K. Jayasankaran Nambiar* and K.V. Jayakumar, JJ. was hearing a group of I.T. appeals preferred by Co-operative Societies raising common questions of law. The appeals challenged the orders of the Assessing Authority, later upheld by the First Appellate Authority and thereafter by the Appellate Tribunal, imposing penalties on the assessees Societies under Section 271-B of the Income Tax Act, 1961 (‘I.T. Act’) for the alleged breach of the procedural provisions under Section 44-AB of the I.T. Act, owing to the failure of the assessees in filing the audit report within the specified time limit. Finding that the assessees had demonstrated reasonable cause for the delay in filing the audit report, the Court allowed the appeals and set aside the impugned orders. [Chavakkad Service Co-operative Bank v. Income Tax Officer, 2024 SCC OnLine Ker 6873, decided on 22-11-2024] Read more HERE
CHHATTISGARH HIGH COURT | Bona fide belief plus genuineness of transaction constitutes reasonable cause under S. 273B, Penalty can’t be imposed under S. 271E of Income Tax Act
In a tax appeal filed by an assessee against a penalty order for violation of Section 269-T of the Income Tax Act, 1961 (‘the Act’), the Division Bench of Sanjay K. Agrawal* and Deepak Kumar Tiwari, JJ., allowed the appeal, holding that though a reasonable cause was shown by the assessee for non-compliance with Section 269-T of the Act and the transaction was undisputedly genuine and bona fide, all the three tax authorities ignored Section 273B, and levied a penalty under Section 271E. [Sandeep Kaur Gill v. Union of India, 2025 SCC OnLine Chh 5189, decided on 01-05-2025] Read more HERE
BOMBAY HIGH COURT | ‘Authorities stood motionless for 5 years’; Rs 10000 cost each imposed on authorities for failing to act in UIDAI identity fraud case
The present writ petition was filed by the petitioner under Article 226 of the Constitution, after his Aadhaar and PAN details were fraudulently used to open a bank account, obtain GST registration and conduct business transactions and despite repeated complaints, none of the statutory agencies including Unique Identification Authority of India (‘UIDAI’), Income Tax Department, Union Bank, and GST authorities took timely action. The Division Bench of M.S. Sonak and Jitendra Jain*, JJ., while allowing the petition held that the prolonged inaction of the statutory and regulatory authorities amounted to a serious dereliction of their duties, emphasising that they failed to discharge their legal obligations by not taking any action since the last five years of the discovery of fraud committed on them. Further, the Court imposed cost of Rs 10,000 on each of the authorities, which was to be paid to the petitioner for their dereliction of duty. [Vilas Prabhakar Lad v. Unique Identification Authority of India, 2025 SCC OnLine Bom 2724, decided on 21-7-2025] Read more HERE
ALLAHABAD HIGH COURT | Interim relief granted to telecom towers; Property tax notices issued by Lucknow Municipal Corporation, stayed
In a writ petition concerning the issue of whether municipal bodies could impose property taxes on telecommunication towers in light of the enactment of the Telecommunications Act, 2023, a Division Bench of Rajan Roy and Om Prakash Shukla, JJ., stayed the operation of the impugned notices and tax bills issued by the municipal authorities for levying property taxes on such towers. The stay was granted in line with the Court’s earlier order dated 05-03-2025. The Court observed that the matter involved several significant legal questions, notably the extent to which regulations or rules framed under the Uttar Pradesh Municipal Corporation Act, 1959 could be applied following the enactment of the Telecommunications Act, 2023. The Court particularly referred to Section 14(3) and Section 52 of the 2023 Act, noting that these provisions, prima facie, supported the petitioner’s case and suggested that the central legislation would prevail in the event of a conflict with any State law or subordinate legislation made thereunder. [Elevar Digital Infrastructure Private v. UOI, 2025 SCC OnLine All 3120, decided on 01-05-2025] Read more HERE
BOMBAY HIGH COURT | Mere change in tax rate for future AYs, no ground to reopen assessment without fulfilling jurisdictional parameters under S. 148 of Income Tax Act
In a case wherein, the petitioner challenged the impugned notice dated 25-03-2021 under Section 148 of the Income Tax Act, 1961 (‘the 1961 Act’) and the impugned order dated 31-01-2022, whereby the petitioner’s objection to reopening of the assessment made by Respondent 1 for the assessment year 2014-2015, was rejected, the Division Bench of M.S. Sonak* and Jitendra Jain, JJ., merely because there was some change in the tax rate for the future assessment years of the petitioner, that is, its status changed to “non-resident” from “resident”, making it subject to 40% tax rate, instead of 30%, the provisions of Section 148 of the 1961 Act could not be invoked without the jurisdictional parameters of the said sections being fulfilled. The Court quashed and set aside the impugned notice dated 25-03-2021, and the consequent order dated 31-01-2022. [Oxford University Press v. CIT, 2025 SCC OnLine Bom 340, decided on 11-02-2025] Read more HERE
INCOME TAX APPELLATE TRIBUNAL | ‘Escaped income is below Rs 50 lakhs’; ITAT quashes reassessment notice under S. 148 Income Tax Act issued beyond prescribed limitation of 3 years
In the present case, an appeal was filed by the appellant-assessee against the impugned order dated 16-6-2025, passed by the NFAC, Delhi relating to assessment year (‘A.Y.’) 2017-18, whereby NFAC confirmed the action of the Assessing Officer (‘AO’) in upholding the validity of reassessment proceedings initiated under Section 147 read with Section 148 of the Income Tax Act, 1961 (‘Act’), although the reopening was barred by limitation as escaped income was less than Rs 50 lakhs and did not fall under the extended time limitation under Section 149(1)(b). Mahavir Singh (Vice President), observed that the escaped income in the present case was below Rs 50 lakhs and as per Section 149(1)(a), the notice under Section 148 could be issued only within 3 years from the end of relevant assessment year, i.e., upto 31-03-2021, whereas in the present case, the notice was issued on 09-02-2024. Thus, the Tribunal allowed the appeal and held that the notice under Section 148 was issued beyond the permissible period of limitation under Section 149(1)(a), therefore, the reassessment was void ab initio. [Malkiat Singh v. CIT, 2025 SCC OnLine ITAT 11669, decided on 8-10-2025] Read More HERE
ALLAHABAD HIGH COURT | Maintainability of proceedings under S. 148A(b) of Income Tax Act post-enforcement of Finance (No. 2) Act, 2024
In a matter concerning the maintainability of proceedings under Section 148-A(b) of the Income Tax Act, 1961 (‘IT Act’), initiated prior to 01-09-2024, the issue arises as to whether such proceedings would continue to be valid or would be saved after the enforcement of the Finance Act No. 02 of 2024, with effect from 01-09-2024, especially in view of Section 152(4) of the Income tax Act, 1961, which has been inserted by the Finance Act No.2 of 2024, the division bench of Rajan Roy and Brij Raj Singh, JJ. after noting that the Revenue had conceded to the argument of the petitioner, quashed all the impugned orders and notices. [Ravish Rastogi v. Union of India, 2025 SCC OnLine All 1043, decided on 16-01-2025] Read more HERE
ALLAHABAD HIGH COURT | Fresh remedy under Article 226 barred once statutory remedy availed; Writ rejected after Assessee filed rectification application under IT Act
In a writ petition filed seeking quashing of notice passed against the petitioner under Sections 148 and 148A(d) of the Income Tax Act, 1961(“IT Act”), as well as the subsequent order passed against him and also seeking release of his bank accounts, the Division Bench of Shekhar B. Saraf and Majive Shukla, JJ., dismissed the application, holding that since the petitioner chose to proceed under the remedy provided in the statute, he could not be allowed to seek a fresh remedy under Article 226 of the Constitution. The Court reiterated that one cannot claim a fresh remedy under Article 226 after availing a statutory remedy. [Anand Kumar Verma v. Prin. Commissioner of Income Tax, Allahabad, 2025 SCC OnLine All 8091, decided on 27-11-2025] Read more HERE
SUPREME COURT | Whether offence under S. 276CC of IT Act 1961 committed before show-cause notice is compoundable as ‘first offence’
In a civil appeal against Gujarat High Court’s decision, whereby the order of Chief Commissioner of Income Tax, Vadodara (CIT) was upheld and application preferred by the appellant-assessee for compounding of the offence under Section 276-CC of the Income Tax Act, 1961 (‘the Act’) was dismissed, the Division Bench of JB Pardiwala* and Sanjay Karol, JJ. held that the High Court erred in rejecting the assessee’s application for compounding. The Court held that the offence alleged under Section 276-CC of the Act for the AY 2013-14 was covered by the expression “first offence” as defined under the 2014 guidelines and thus the compounding application preferred by the assessee could not have been rejected by the CIT on this ground alone. Hence, the Court set aside the impugned decision along with CIT’s order. [Vinubhai Mohanlal Dobaria v. Chief Commissioner of Income Tax, 2025 SCC OnLine SC 270, decided on 7-2-2025] Read more HERE
BOMBAY HIGH COURT | ‘Offence under S. 272-C(2) of Income Tax Act is bailable’; Non-bailable warrant against Arjun Rampal in tax evasion case, quashed
The present petition was filed under Section 528 of Bharatiya Nagarik Suraksha Sanhita, 2023, challenging order dated 5-12-2019 of issuing process against the petitioner, Arjun Amarjeet Rampal and another order dated 9-4-2025 passed by the Additional Chief Metropolitan Magistrate, 38th Court, Ballard Pier, Mumbai, wherein a non-bailable warrant was issued by the trial court against the petitioner for offence punishable under Section 276-C(2) of the Income Tax Act, 1961 (‘IT Act’). A Single Judge Bench of Advait M. Sethna, J., opined that the Magistrate passed the order dated 9-4-2025 issuing a non-bailable warrant against the petitioner in a bailable offence. The Court stated that the said order would cause prejudice to the petitioner and thus, quashed and set aside the order dated 9-4-2025. [Arjun Amarjeet Rampal v. CIT, 2025 SCC OnLine Bom 2049, decided on 16-5-2025] Read more HERE
HIMACHAL PRADESH HIGH COURT | “No equity in taxation law”: Tax exemption under S. 14 HP Motor Vehicles Taxation Act refused to man who bought auctioned vehicles
In a civil writ petition filed seeking the transfer of registration of certain vehicles bought by the petitioner in an auction due to the pendency of taxes, a Single Judge Bench of Tarlok Singh Chauhan* and Sushil Kukreja, JJ., rejected the petition holding that the petitioner was not entitled to the benefit of tax exemption under Section 14(3) of the HP Motor Vehicles Taxation Act, 1972 (‘the Act’) as no previous intimation was given by previous owner/department having possession of the motor vehicles or the petitioner as per Section 14(2). [Zahhad v. State of Kerala, 2025 SCC OnLine Ker 3510, decided on 02-06-2025] Read more HERE
HIMACHAL PRADESH HIGH COURT | ‘Twin Conditions under S. 127 of Income Tax Act was not complied with’; Relief granted to assessee whose tax assessment was wrongly transferred
In an income tax appeal and a civil writ petition filed by the petitioner/ assessee against the order of the Commissioner of Income Tax (Appeals)(‘CIT’) whereby the petitioner’s appeal was rejected and the best judgment assessment framed by the respondent 5, i.e., Income Tax Officer, Himachal Pradesh (‘ITO Himachal’), the Division Bench of Tarlok Singh Chauhan* and Rakesh Kainthla, JJ., allowed the income tax appeal as well as the writ petition holding that the respondents did not comply with the procedure laid down in Section 127 of the Income Tax Act, 1961 (‘the Act’) in transferring the petitioner’s case from Delhi to Himachal Pradesh. [Deluxe Enterprises v. Income Tax Officer, 2025 SCC OnLine HP 44, decided on 02-01-2025] Read more HERE
LANDMARK INDIRECT TAX JUDGMENTS of 2025
Calcutta High Court | Bail granted in Rs. 37.29 cr GST ITC fraud case involving arrest without adjudication
A petition was filed under Section 439 of Criminal Procedure Code/ Section 483 of the Bharatiya Nagarik Suraksha Sanhita 2023, by the petitioner who is in custody in connection with a case dated 31-03-2025 under Sections 132 (1) (c) read with 132 (5) of the Central Goods and Service Tax Act 2017, pending before the Additional Chief Judicial Magistrate Siliguri Darjeeling. Biswaroop Chowdhary, J. granted bail and held that the arrest of the petitioner without fresh incriminating material, without adjudication, and despite the petitioner’s cooperation was disproportionate and legally unjustified. [Santosh Kumar Sah v. Union of India, 2025 SCC OnLine Cal 3255, decided on 17-04-2025] Read more HERE
PUNJAB AND HARYANA HIGH COURT | Pending investigation against co-accused cannot be sole ground to deny bail to accused under Section 132 CGST Act
In the present case, two petitions were filed under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (‘BNSS’) seeking regular bail in the case filed under Sections 132(1)(b) and 132(1)(c) of the Central Goods and Service Tax Act, 2017 (‘CGST Act’). A Single Judge Bench of Harpreet Singh Brar, J., held that an accused in a complaint under Section 132 of the CGST Act could not be denied the concession of bail solely on the ground that the investigation remained pending against a co-accused. Thus, the Court released the petitioners on regular bail. [Manish Kumar v. GST Intelligence Directorate, 2025 SCC OnLine P&H 5530, decided on 28-7-2025] Read more HERE
BOMBAY HIGH COURT | Capital gains tax applies to vintage car sale when no evidence of personal use is adduced
The present appeal was filed by the Assessee challenging the Income Tax Appellate Tribunal’s (‘ITAT’) decision treating profit from the sale of a vintage car as taxable capital gains rather than exempt as a “personal effect”. The Assessee argued that the car was his personal asset and should not attract capital gains tax. The Division Bench of Alok Aradhe, CJ*., and Sandeep V. Marne, J., held that for an article to qualify as a “personal effect”, there must be evidence of personal use. Since, the Assessee failed to adduce any evidence with regard to the vintage car being put to personal use, therefore, the Court upheld ITAT’s order and rule that pride of possession did not constitute personal use under Section 2(14) of the Income Tax Act, 1961 (‘1961 Act’). [Narendra I. Bhuva v. Assistant Commissioner of Income Tax, 2025 SCC OnLine Bom 2936, decided on 14-08-2025] Read more HERE
DELHI HIGH COURT | Baggage Rules required to be re-looked to ensure no harassment of genuine tourists/travellers carrying gold jewellery
In a petition filed under Article 226/227 of the Constitution, challenging the orders dated 06-02-2024 and 23-09-2024, passed by the Joint Commissioner of Customs and the Commissioner of Customs (Appeals), respectively, the Division Bench of Prathiba M. Singh* and Dharmesh Sharma, JJ., stated that the Baggage Rules, 2016, (‘Baggage Rules’) were required to be re-looked by the Central Board of Indirect Taxes and Customs (‘CBIC’) and a policy decision was required to be taken by the Government of India to ensure that there was no harassment of genuine tourists and travellers, and also to ensure that illegal smuggling of gold was properly curbed. The values of gold that would be permissible under the Baggage Rules would also have to be re-looked by the CBIC, as the same appeared to be completely not in tune with the current market value of gold. [Qamar Jahan v. Union of India, 2025 SCC OnLine Del 143, decided on 13-01-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI | Penalties set aside against E-rickshaw manufacturer alleged to have evaded duty in import classification dispute
In the present case related to e-rickshaw import classification dispute , the penalty was imposed on Soni E Vehicle (P) Ltd., (‘appellant’), the e-rickshaw manufacturer, who was alleged to have wilfully classified the imported goods as spare parts of e-rickshaw resulting in evasion payment of duty. The two-member bench comprising Dilip Gupta, J. (President) and Hemambika R. Priya (Member — Technical) stated that the the office order dated 12-3-2014 makes it clear that the motor is an essential component for classifying imported goods as a complete e-rickshaw under Custom Tariff Heading (‘CTH’) 8703. If the motor is not imported, then regardless of the presence of other parts, the goods must be treated only as parts of an e-rickshaw under CTH 8708. The Tribunal stated that in the present case, the Principal Commissioner failed to appreciate this important aspect and concluded that the consignment should be classified as a full e-rickshaw even though the motor was missing. Therefore, the Tribunal stated that the Principal Commissioner misread the office order, and the correct classification should have been under CTH 8708 as parts, not under CTH 8703 as a complete e-rickshaw. Accordingly, the Tribunal set aside the entire impugned order dated 20-8-2020. [Soni E Vehicle (P) Ltd. v. Commr. of Customs, 2025 SCC OnLine CESTAT 3839, decided on 17-11-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI | ‘Adjudicating authority cannot go beyond show-cause notice’; order demanding Countervailing Duty on areca nuts processing machines set aside
In a matter concerning short-fall in the payment of Counter Vailing Duty (‘CVD’) due to wrong classification of the imported machineries for processing of areca nuts, by the appellant-pan masala manufacturer, the Bench of Dr. Rachna Gupta, Member (Judicial) and P.V. Subba Rao, Member (Technical) opined that the adjudicating authority cannot travel beyond the scope of show-cause notice and cannot confirm classification which was neither claimed by the appellant nor proposed by the department and therefore, it is not sustainable. Thus, the Tribunal set aside the impugned order demanding counter-vailing duty on areca nuts processing machines. [Dharampal Satyapal Ltd. v. Commr. of Customs, 2025 SCC OnLine CESTAT 1977, decided on 2-7-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL | ‘Purchasing gold without bill insufficient to prove smuggling’; penalty orders on jewellers set aside
In a matter concerning the smuggling of gold, Dr. Rachna Gupta, Member (Judicial) opined that Appellants- jewellers in state of Haryana, had merely attempted to purchase gold from the accused to reduce costs while preparing jewellery for their customers. The appellants were unaware of any alleged illegal act of smuggling of gold. It was further observed that mere act of purchasing gold without bill is highly insufficient to confirm the grave allegations of conspiring the act of smuggling of gold. [Rajesh Sehgal v. Commr. of Customs Respondent Preventive, New Delhi, 2025 SCC OnLine CESTAT 2001, decided on 03-07-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI | Commissioner of Customs is a stranger to contract of sale, cannot re-determine FOB value of export goods
In an appeal against the order dated 24-3-2011, passed by Commissioner of Customs Tughlakabad (impugned order), the two-member bench of Dilip Kumar,J. (President) and P.V. Subba Rao (Technical member), held that the Commissioner had no authority to re-determine the Free on Board (‘FOB’) values of the export goods and accordingly set aside the impugned order. The Tribunal further stated that the Commissioner or any customs officer, being a stranger to the contract of sale, would have no authority to re-determine the transaction value under the FOB. [Mahir Fashions v. Commissioner of Customs New Delhi, 2025 SCC OnLine CESTAT 2103, decided on 22-7-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI | Drawback due on goods will be payable when the amount is less than market value of goods
In an appeal filed against the order passed by Commissioner of customs, the two-member Bench of Rachna Gupta (Judicial Member) and P.V. Subba Rao (Technical Member)* setting aside the order stated that in accordance with Section 76 (1) (b) of the Customs Act, 1962 (Customs Act), “No drawback due will be payable unless the amount of drawback which will be due on the goods itself, exceeds the market value of the goods”. The Tribunal held that as long as the drawback due is less than the market value of the goods, it is payable. The Tribunal further stated that the transaction value (FOB value) on which drawback has to be paid need not be the same as the market value of the goods. [Modak Dyeing & Printing Co. (P) Ltd. v. CCE, 2025 SCC OnLine CESTAT 2157, decided on 29-7-2025] Read more HERE
KARNATAKA HIGH COURT | State has no legislative competence to levy tax on minimum tariff for supply of electricity
The single Judge Bench of Anant Ramanath Hegde, J., declared Section 3(1) of the 1959 Act, as amended by Act No.7 of 2003 and Act No.5 of 2004, imposing tax on electricity charges as unconstitutional. The Court further clarified that only the tax on ‘minimum tariff’ has been held unconstitutional and not the tax collected on the consumption of electricity. The Court held that supply of electricity to the consumer to ensure availability of electricity for consumption, does not amount to consumption or sale, unless the electricity consumed by the consumer, and the State has no legislative competence under Entry 53, List II of Seventh Schedule to the Constitution to levy tax on minimum tariff. The State is competent to levy tax under Entry 53, List II of Seventh Schedule only on actual consumption or sale of electricity. [Sona Synthetics v. State of Karnataka, 2025 SCC OnLine Kar 1949, decided on 20-6-2025] Read more HERE
BOMBAY HIGH COURT | ‘Online sale of movie tickets not separate business’: Levy of entertainment duty on convenience fee exceeding Rs. 10, upheld
In a writ petition challenging the constitutional validity of seventh proviso in Section 2(b) of the Maharashtra Entertainments Duty Act, 2014 (‘MED Act’), the Division Bench of M.S. Sonak and Jitendra Jain*, JJ., dismissed the petition and upheld the challenged provision to be intra vires and within State’s legislative competence. The Court opined that Entry 62, List II of the Seventh Schedule, deals with taxation on entertainment and matters incidental thereto. Thus, making of law for determining the measure of tax is a power within the competence of the State under Entry 62 List II of Seventh Schedule to the Constitution and therefore, the challenged amendment is not a colourable exercise of power by the State. Furthermore, it was also emphasised by the Court, that merely changing the mode of sale from counter to online does not mean that selling tickets online constitutes a separate business activity. Further, splitting the transaction or styling it as a separate activity having no nexus or connection with payment for admission, or calling it by some other name, cannot be grounds to either strike down the levy or declare that it would not be attracted. [FICCI v. State of Maharashtra, 2025 SCC OnLine Bom 2847, decided on: 6-8-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, KOLKATA | ‘Mere tallying of certain entries does not make loose sheets as complete evidence of purchases and sales’: excise duty demand set aside
In an appeal filed by the appellant company challenging the demand confirmed by the Adjudicating Authority along with interest and penalty in the impugned order, the Bench of R. Muralidhar, Member (Judicial) and Rajeev Tandon, Member (Technical), stated that mere tallying of certain entries, does not make these delible pencil handwritten loose sheets (‘loose sheets’) to be complete evidence of the purchases and sales and other details pertaining to the appellant. Thus, the Tribunal held that the confirmed demands were not legally sustainable on merit and consequently, set aside the excise duty demand. [DD Iron & Steel (P) Ltd. v. Comm. (CGST & CCE), 2025 SCC OnLine CESTAT 2055, decided on 14-7-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL | Old/Used Lead Acid Batteries recovered from ship not exigible to central excise duty
In an appeal filed against order of confirmation of the demand of central excise duty by Commissioner (Appeals), the two-member Bench of Satendra Vikram Singh (Technical Member) and Ajaya Krishna Vishvesha (Judicial Member) allowed the appeal and held that old Lead Acid Batteries recovered from ship breaking were not excisable under the Central Excise Act, 1944 (Central Excise Act) as it did not amount to manufacture. [Madhav Industrial Corpn. v. CCE, 2025 SCC OnLine CESTAT 3330, decided on: 29-9-2025] Read More HERE
PATNA HIGH COURT | Rectification of form GSTR 3B on par with the contents of GSTR- 1, allowed
In the instant Civil Writ Petition, wherein the issue was whether the petitioner could be allowed to rectify his form GSTR 3B in accordance with GSTR 1; the Division Bench of P. B. Bajanthri* and S. B. PD. Singh JJ., allowed the petitioner to amend his GSTR 3B after placing reliance on Supreme Court’s decision in Central Board of Indirect Taxes & Customs v. Aberdare Technologies Pvt. Ltd.1 wherein the Court had affirmed Bombay High Court’s decision to allow the taxpayer to rectify the clerical error. [Om Traders v. Union of India, 2025 SCC OnLine Pat 2148, decided on 13-05-2025] Read more HERE
AUTHORITY FOR ADVANCE RULING, TAMIL NADU | Separate GST registration not required under S. 22 CGST Act for Free Trade Warehousing Zone operations
In an application filed by West Pharmaceutical Packaging India Pvt. Ltd. (‘applicant’), the two-Member Bench of B. Susee Kumar (Member-SGST) and Balakrishna S. (Member-CGST) ruled that the applicant was not required to obtain a separate GST registration in Tamil Nadu for its Free Trade Warehousing Zone (‘FTWZ’) unit at Chennai, since all taxable supplies were covered under its existing Telangana registration. [West Pharmaceutical Packaging India Pvt. Ltd., In re, 2025 SCC OnLine TN AAR-GST 21, order dated 09-05-2025] Read More HERE
MADRAS HIGH COURT | RVNL is liable to be taxed at concessional rate of 12% GST, and not 18% for railway work contracts
In the present case, the batch of five writ petitions challenged the impugned orders for the assessment years 2018-19, 2019-20, 2020-21, 2021-22 and 2022-23, whereby the petitioner’s claim for concessional rate of 12% on works contract services of original works executed pursuant to a contract entered with Rail Vikas Nigam Limited (‘RVNL’) was rejected, instead the impugned order’s levied tax at 18%. Mohammed Shaffiq, J., set aside the impugned orders and the contract for doubling of track between Vanchi Maniyachchi to Nagercoil, construction of roadbed, minor bridges, platforms, buildings, water and effluent treatment facilities, wagon / coaching maintenance infrastructure, supply of ballast, installation of tracks and other electrical, signalling and telecommunication infrastructure in Madurai and Thiruvananthapuram Divisions of Southern Railway, between the petitioner and RVNL would be covered by the Notification dated 28-06-2017 (‘the notification’) issued by Central Government and liable to tax at 12%. [STS-KEC(JV) v. State Tax Officer, 2025 SCC OnLine Mad 1115, decided on 28-01-2025] Read more HERE
AUTHORITY FOR ADVANCE RULING, GUJARAT | Input Tax Credit claim on buyback expenditure of Gujarat Narmada Valley Fertilizers & Chemical’s shares refused
In an appeal filed by Gujarat Narmada Valley Fertilizers & Chemicals Ltd. (GNFC) against the ruling of the Gujarat Authority for Advance Ruling (GAAR) denying input tax credit (ITC) on expenses incurred for buyback of shares, the Two-Member Bench of Rajeev Topno, Member (SGST)* and Sunil Kumar Mall, Member (CGST)* rejected the appeal, holding that since buyback of shares constitutes a transaction in securities, which is neither a supply of goods nor of services under the Central Goods and Services Tax Act, 2017 (CGST Act), no ITC can be availed on such expenditure and reversal of common input credit is mandatory under Section 17(3) of the CGST Act. [Gujarat Narmada Valley Fertilizers & Chemicals Ltd. v. Commissioner, State Tax, Gujarat, Advance Ruling (Appeal) No. GUJ/GAAAR/APPEAL/2025/17, decided on 22-09-2025] Read More HERE
JHARKHAND HIGH COURT | ‘Notice under Section 61 JGST Act cannot be issued for mere sale of goods at concessional rates’; GST-ASMT 10 notices quashed
In a series of writ petitions filed against the GST-ASMT-10 notices issued under Section 61 of Jharkhand Goods and Services Tax Act, 2017 (‘JGST Act’) to the petitioners for selling their goods at prices lower than the prevalent market prices, the Division Bench of M.S. Ramachandra Rao, C.J. and Deepak Roshan, J*., quashed the notices holding that no action under JGST Act can be taken merely because of difference in transaction value at which the petitioners have sold the goods with that of prevalent market value of goods. [Sri. Ram Stone Works v. State of Jharkhand, 2025 SCC OnLine Jhar 2169, decided on 09-05-2025] Read more HERE
SUPREME COURT | Explained | Supreme Court’s verdict on constitutional validity of “power to arrest” provisions under Customs and GST Acts
In a matter concerning the power to arrest under the Customs Act, 1962 and the Central Goods and Services Tax Act, 2017 (‘CGST Act’), the three Judge Bench of Sanjiv Khanna*, CJI, MM. Sundresh and Bela M. Trivedi**, JJ. rejected the challenge to the constitutional validity as also the right of the authorised officers under the Customs Act and the GST Acts to arrest with elucidation and clarification on the pre-conditions and when and how the power of arrest is to be exercised. [Radhika Agarwal v. Union of India, 2025 SCC OnLine SC 449, decided on 27-2-2025] Read more HERE
BOMBAY HIGH COURT | License fee on sky-signs and hoardings held to be regulatory fee, not tax, despite GST
While deciding a batch of petitions challenging the levy of license fees on sky-signs and hoardings under Section 244 read with Section 386(2) of the Maharashtra Municipal Corporation Act, 1949 (‘MMC Act’), the Division Bench of G. S. Kulkarni* and Advait M. Sethna, JJ., held that the levy constituted a regulatory fee and not a tax. The Court observed that despite the deletion of Entry 55 of List II by the 101st Constitutional Amendment Act, 2016 (‘Constitutional Amendment Act’) and the introduction of the Goods and Services Tax (‘GST’) regime, municipal corporations remain competent to impose such fees for regulation and control of sky-signs and hoardings. [Manoj Madhav Limaye v. State of Maharashtra, 2025 SCC OnLine Bom 5058, decided on 10-12-2025] Read more HERE
JHARKHAND HIGH COURT | ‘Retention of balance after assessing officer reduced the demand amounts to unjust enrichment’; Refund of pre-deposit amount submitted during appeal proceedings, ordered
In a petition seeking direction to the respondents to refund excess tax of Rs. 24,00,000 deposited during appellate proceedings for Assessment Year (‘AY’) 2014-15 and Rs.26,00,000 deposited during appellate proceedings for AY 2013-14, the Division Bench of M.S. Ramachandra Rao, CJ and Deepak Roshan J., stated that if the actual tax assessed from the petitioner was much less than the amount which he had deposited at the time of filing the appeal, then retention of the balance after the assessing officer, reduced the demand drastically post remand, would undoubtedly amount to unjust enrichment on the part of the respondents and would be violative of Article 14 and Article 265 of the Constitution. Thus, the Court directed the respondents to refund the amounts deposited by the petitioner after adjusting the same towards the tax finally assessed post remand by the assessing authority for the AY 2013-14 and AY 2014-15 with interest at the rate of 9% per annum from 09-01-2021 till the date of actual payment. [Castrol India Ltd. v. State of Jharkhand, 2025 SCC OnLine Jhar 557, decided on 19-02-2025] Read more HERE
SIKKIM HIGH COURT | Refund of Rs 4.37 crore ordered; unutilized input tax credit to SICPA India (P) on its business closure
A tax related writ petition was brought before this Court under Articles 226 and 227 of the Constitution, wherein the petitioner claimed a refund of Rs 4.37 crore in unutilised Input Tax Credit (‘ITC’) after closure of their business under Section 49(6) of the Central Goods and Services Tax Act, 2017 (‘CGST Act’). A Single Judge Bench of Meenakshi Madan Bai, J., opined that while Section 54(3) laid down specific circumstances for refund of ITC, it did not contain an express bar in Section 49(6) read with Section 54 and 54(3) CGST Act on granting refund upon business closure. The Court thus ordered that the petitioners were entitled to the refund of unutilized ITC claimed by them. [SICPA India (P) Ltd. v. Union of India, 2025 SCC OnLine Sikk 61, decided on 10-6-2025] Read more HERE
BOMBAY HIGH COURT | Nescafe Premix is ‘Instant Coffee’, taxable at 8%, not 16%
In a reference made by the Maharashtra Sales Tax Tribunal (Tribunal), under Section 61 of the Bombay Sales Tax Act, 1959, to determine whether “Coffee and Instant Drinks Nescafe Premix” is classifiable under Entry C-II-3 (tax 8%) or Entry C-II-18(2) (tax 16%) of Schedule C, a Division Bench of M.S. Sonak and Advait M. Sethna, JJ., upheld the Tribunal’s view that Nescafe Premix is covered by Entry C-II-3 and therefore taxable at 8%, not 16%. [Commr. of Sales Tax v. Nestle India Ltd., 2025 SCC OnLine Bom 4950, Decided on 27-11-2025] Read more HERE
BOMBAY HIGH COURT | Canned Pineapple Slices, tidbits and fruit cocktail not ‘Fresh Fruits’, not exempted from Tax
In a reference under Section 61 of the Bombay Sales Tax Act, 1959, to determine whether pineapple slices, pineapple tidbits and fruit cocktail preserved in sugar syrup and canned in vacuum sealed containers constituted “fresh fruits” falling under Entry A-23 of the Schedule and therefore exempted from tax, a Division Bench of M.S. Sonak* and Advait M. Sethna, JJ., set aside Maharashtra Sales Tax Tribunal’s (Tribunal) order and held that canned pineapple slices, tidbits and fruit cocktail are not “fresh fruits” under Entry A-23. [Commr. of Sales Tax v. Sudha Instant Soft Drinks and Essences, Nagpur, 2025 SCC OnLine Bom 5141, Decided on 04-12-2025] Read more HERE
ORISSA HIGH COURT | Services provided to individual by advocate or firm are exempted from levy of service tax; Rs. 2 Lakhs service tax notice, quashed
In a civil writ petition by a practicing advocate against the service tax notice of Rs. 2,14,600/- served upon him, the Division Bench of Chief Justice Harish Tandon and B.P. Routray, J. allowed the petition, and quashed the impugned notices, reiterating that lawyers with their individual practice are exempt from levy of GST and service tax. [Shivananda Ray v. Principal Commissioner CGST, 2025 SCC OnLine Ori 1442, decided on: 07-04-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, KOLKATA | ‘Mechanical reliance on income tax data impermissible’: service tax demand confirmed without corroborative evidence set aside
In an appeal filed against order of confirmation of the service tax demand by Commissioner (Appeals), K. Anpazhakan (Technical Member) stated that the demand confirmed in the order, solely relying on the data received from Central Board of Direct Taxes (CBDT), without adducing corroborative evidence in support, could not be sustained. Such mechanical reliance on income tax data, without verification of the nature of receipts of proof of taxable services rendered, was impermissible in law. Thus, the Tribunal set aside the impugned order. [Tabassum Enterprises v. Commr. (CGST), 2025 SCC OnLine CESTAT 3166, decided on 19-9-2025] Read More HERE
SUPREME COURT | Service Tax Exemption | Whether collection, processing, & storing umbilical cord blood stem cells are ‘healthcare services’? SC answers
While considering an appeal against Customs, Excise and Service Tax Appellate Tribunal (CESTAT) verdict holding that services of enrolment, collection, processing, and storage of umbilical cord blood stem cells, provided by the appellant, do not fall within the scope of “Healthcare Services”; the Division Bench of J.B. Pardiwala and R. Mahadevan*, JJ., found that the appellant’s services fell within the ambit of “Healthcare Services” as defined under the exemption Notification No.25/2012—Service Tax dated 20-06-2012. It was held that these services are preventive and curative in nature and encompass diagnosis, treatment, and care. [Stemcyte India Therapeutics Ltd. v. Commissioner of Central Excise and Service Tax, 2025 SCC OnLine SC 1412, decided on 14-7-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI | ‘No service tax to be paid on upfront fee/premium for agreement to lease’; penalty on DMRC set aside
The Appellant, Delhi Metro Rail Corporation Ltd. (‘DMRC’) challenged the order passed by the Commissioner of Central Excise & Service Tax, Rohtak (‘Commissioner’), wherein the demand of service tax on a portion of the amount received as “upfront fee” was upheld under the category of “Renting of Immovable Property Service” under the provisions of the Finance Act, 1994 (‘1994 Act’). The Tribunal comprising Binu Tamta, Member (Judicial) and Hemambika R. Priya, Member (Technical) held that definition of “Renting of Immovable Property” under Section 65(90-a) of the 1994 Act included only “leasing” and not an “agreement to lease”, thus “premium” or “upfront fee” received for entering into an “agreement to lease” was not liable to service tax. Further, the penalty imposed on DMRC under Section 78 of 1994 Act was set aside by the Tribunal. [DMRC Ltd. v. CCE & CST, 2025 SCC OnLine CESTAT 1991, decided on 2-7-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI | ‘To be paid by distributors’: order directing theatre owner to pay service tax for film screening set aside
In an appeal by the appellant, who was the owner of M2K Cinemas, against a decision of the Commissioner of Central Tax, (Delhi West), whereby the appellant was directed to pay the service tax for film screening, the Division Bench of Binu Tamta, Member (Judicial) and Hemambika R. Priya, Member (Technical), stated that the impugned order for levy of service tax on the appellant is unsustainable and accordingly, set aside the impugned order. The Tribunal stated that the service tax is to be levied and paid by the distributor under ‘Copy Right Service’ for transfer of right by licence to screen the film in the appellant’s theatre. [M2K Entertainment (P) Ltd. v. Commr. of Central Tax, 2025 SCC OnLine CESTAT 1997 decided on 2-7-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, BANGALORE | Whether service tax can be levied on transfer or assignment of copyright of the film produced under copyright service?
In the present case, the issue for consideration was whether service tax could be levied on exhibition of films under the category of Business Auxiliary Service (‘BAS’) or demand could be confirmed against transfer or assignment of copyright of the film produced by the appellant under copyright service. The two-member Bench of P.A. Augustian (Judicial Member)* and R. Bhagya Devi (Technical Member), set aside the order of Adjudication Authority and held that the agreement for absolute assignment of right for perpetual period would not fall under the category of copyright service thus, demand of service tax was unsustainable. Further, the order confirming demand under BAS was also held unsustainable as it was not mentioned that which service out of the seven services specified in Section 65(19) of the Finance Act, 1994 (‘the 1994 Act’), was undertaken by the appellant. [Play House Motion Pictures (P) Ltd. v. CCE and CST, 2025 SCC OnLine CESTAT 2208, decided on 30-7-2025] Read more HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, ALLAHABAD | SKY Lark Education Welfare Society an educational institution; will be exempted from service tax:
In an appeal filed against the order passed by the Commissioner (Appeals), CGST, Noida, a Single Judge Bench of P.K. Choudhary (Judicial Member) noted that the appellant-SKY Lark Education Welfare Society was providing vocational education under programme approved by National Urban Livelihood Mission, which were based on curriculum approved by Uttar Pradesh Government. The Tribunal held that the appellant would be treated as educational institution as per the definition given under Clause (oa) of Notification No.25/2012-ST, dated 20-6-2012 issued by the Ministry of Finance, Government of India. Thus, the services provided by the appellant would be exempted from service tax under Clause (9) of the Notification. [SKY Lark Education Welfare Society v. Commr. (CGST), 2025 SCC OnLine CESTAT 2747, decided on: 29-8-2025] Read More HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, DELHI | Damages received for dispute settlement of agreement to sell, not taxable as ‘declared service’ under S. 66-E(e) of Finance Act, 1994
In appeals filed against the orders passed by Commissioner (Appeals), CGST, the two-member Bench of Binu Tamta (Judicial Member) and P.V. Subba Rao (Technical Member) allowed the appeals and held that damages received for settlement of dispute of an agreement to sell, did not amount to a ‘Declared Service’ under Section 66-E(e) of the Finance Act, 1994 (‘Finance Act’). [Ajay Kumar Sood v. Commr. (CGST), 2025 SCC OnLine CESTAT 2965, decided on: 1-9-2025] Read More HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, CHENNAI | Service tax not payable on use of trade marks not registered under Indian law
In an appeal filed against order of the demand of service tax by the Adjudicating authority, the two-member Bench of Vasa Seshagiri Rao (Technical Member) and P. Dinesha (Judicial Member)* allowed the appeal and held that the use of trade marks and technology by the appellant under Production Services Agreement with DTS Inc., a Corporation incorporated in the United States of America (‘DTS’) did not constitute ‘intellectual property rights’ within the meaning of Section 65(55a) of the Finance Act, 1994 (‘the Act’). The Tribunal stated that the mark in question was not registered in India and therefore, the related services were not ‘intellectual property services’ within the meaning of Section 65(55b) of the Act. Thus, service tax couldn’t be levied. [Real Image Media Technologies (P) Ltd. v. CCE (GST), 2025 SCC OnLine CESTAT 3669, decided on 29-10-2025] Read More HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, DELHI | Complimentary services provided by lessee to lessor under hotel lease agreement are liable for Service Tax
In an appeal filed against the order of confirmation of the demand of service tax with interest and penalty against the appellant (lessor), a Single Judge Bench of Rachna Gupta (Judicial Member) held that the adjudicating authorities had rightly held that the value of free nights and the discount on food and beverages availed by the lessor were liable to be included in the taxable gross value. It further held that the complimentary room nights and discounts enjoyed by the lessor’s promoters, directors, and their families were additional consideration over and above lease rent, thus, was liable for Service Tax. [Hotel President Planet v. CCE (GST), 2025 SCC OnLine CESTAT 3808, decided on 06-11-2025] Read More HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, AHEMDABAD | Transferring tenancy and occupancy rights in immovable property not service under S. 65-B(44) of Finance Act; not liable to service tax
In an appeal filed against order of confirmation of the demand of service tax by Commissioner (Appeals), the two-member Bench of Satendra Vikram Singh (Technical Member) and Somesh Arora (Judicial Member) allowed the appeal and stated that the activity of transfer of tenancy and occupancy rights in respect of immovable property did not come under the definition of service under Section 65-B(44) of the Finance Act, 1994 (‘Finance Act’). Hence, the amount received from the owner for surrendering and relinquishing tenancy and occupancy rights was not taxable. [Supertex Woven Industries v. CCE, 2025 SCC OnLine CESTAT 3452, decided on: 30-9-2025] Read More HERE
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, KOLKATA | Service Tax not leviable on construction of railway siding for Public Sector Undertaking/Corporations.
In an appeal filed against order of the demand of service tax on construction of railway siding for Public Sector Undertakings, by the Adjudicating Authority, the two-member Bench of S. S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member)* allowed the appeal. The Tribunal held that the construction of railway siding for Public Sector Undertaking/Corporations exempted from levy of service tax under Finance Act, 1994 (‘Act’) as use of public also includes use by Public Sector Undertaking/ Corporations. [Rites Ltd. v. CCE (GST), 2025 SCC OnLine CESTAT 3991, decided on: 21-11-2025] Read More HERE
DELHI HIGH COURT | “Valid TDS payment triggers a fresh period of limitation under Section 19”; Partial financial claim by an Ad Company, allowed
In an appeal filed under Section 13 of the Commercial Courts Act, 2015 by the appellant challenging the order dated 28-04-2023, passed by the District Judge wherein the suit was dismissed on the ground of limitation, a division bench of Subramonium Prasad and Harish Vaidyanathan, JJ., held that that while most of the plaintiff’s claims were barred by limitation under Article 18 of the Limitation Act, the claim against two invoices was saved by a valid TDS payment under Section 19. Accordingly, the Court directed the defendants to pay Rs. 24,27,000 with 6% annual interest from the date of invoice till payment. [Planet Advertising Pvt Ltd v. Ambience Pvt Ltd, 2025 SCC OnLine Del 4886, decided on 02-07-2025] Read more HERE
BOMBAY HIGH COURT | ‘Cannot direct legislature to unbury or re-legislate’; Plea to revive Maharashtra Casinos (Control and Tax) Act, 1976, rejected
The petitioner, formerly known as Mumbai Gambling Management Pvt. Ltd., filed the present petition under Article 226 of the Constitution praying for a relief that the Maharashtra Casinos (Control and Tax) Act, 1976 (‘the 1976 Act’), which was never notified and brought into force, and which stood repealed by the Maharashtra Casinos (Control and Tax) (Repeal) Act, 2023 (‘the Repeal Act’), be directed to be brought into force, by declaring that the Repeal Act was ultra vires the Constitution. The Division Bench of G.S. Kulkarni* and Advait M. Sethna, JJ., opined that in the present case, the prayers were indirectly a relief that the Legislature be directed to re-legislate the 1976 Act. The Court held that a writ could not be issued to the Legislature to unbury or re-legislate, therefore, such revival of the 1976 Act and that too by a Writ of the Court, was an impossibility and a far-fetched expectation, of the petitioner, which the law could never recognize. [Dyutbhumi Hotels & Resorts Pvt. Ltd. v. State of Maharashtra, 2025 SCC OnLine Bom 521, decided on 26-2-2025] Read more HERE
FREQUENTLY ASKED QUESTIONS
Here are answers to common tax queries in 2025:
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What constitutes a reasonable cause for avoiding penalty under the Income Tax Act?
Penalties for delayed filings (e.g., audit reports) can be waived if the assessee can demonstrate sufficient cause.
Example: unforeseen circumstances or reliance on professional advice.
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Can an assessee’s income be clubbed with that of a minor or other family members?
Income of a minor or other family members can generally not be clubbed if it is deposited or used according to a court order or independent legal arrangement; judicial precedent protects such funds from inclusion in the assessee’s taxable income.
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When can a reopening of assessment under Section 148/148A be considered valid?
Reopening is valid only if the jurisdictional conditions are satisfied and new information indicates income has escaped assessment; mere changes in tax rates or laws are insufficient grounds.
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How are license fees, regulatory fees, and taxes differentiated under GST and local law?
Fees charged for regulatory purposes (e.g., hoardings, sky-signs) remain non-taxable even under GST, while license fees or consideration for services may attract GST depending on the transaction’s nature.
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Who is liable to pay service tax on upfront fees, copyright services, or declared services?
Service tax is payable only by the person liable under the law. Upfront fees for “agreement to lease” or copyright services are typically payable by the licensee/distributor, and damages received may not qualify as taxable declared services.
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Are deductions for payments like license fees, goodwill, or royalty allowed under Section 37 of the IT Act?
Payments are deductible if they are revenue in nature, wholly and exclusively for business purposes, and not capital in nature; license fees for use of a founder’s name or goodwill are generally allowed if related to business operations.
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How are goods or services classified for indirect taxes like GST, service tax, or sales tax?
Classification depends on the product/service definition in the statute.
Examples: Nescafe Premix is taxed at 8% as instant coffee, sleeper buses have separate motor vehicle tax rates and works contracts may have concessional GST rates.
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What are the rules around refunds, pre-deposits, and avoidance of unjust enrichment in tax appeals?
Pre-deposits or excess tax paid during appeals must be refunded if the demand is reduced or set aside, ensuring the taxpayer is not unfairly enriched or penalized.
Frequently Asked Questions
Here are answers to common tax queries in 2025.