Same-Sex Couples Can't Claim 'Spouse' Benefits Under Income Tax Act Without Legal Recognition Of Marriage: IT Dept Tells Bombay High Court

To get the benefit of 'exemption' under section 56(2)(x) of the Income Tax (IT) Act, which grants exemption from tax on gifts between heterosexual couple, a same sex couple must first get its union legally recognised as a 'marriage' or 'spouse' etc, the Income Tax Department recently told the Bombay High Court. The Income Tax Department has opposed a plea filed by a same sex couple, which has challenged the constitutional validity of Section 56(2)(x) of the Income Tax (IT) Act, which grants exemption from tax on gifts between heterosexual couples.In an affidavit dated October 14, 2025 filed before a division bench of Justice Burgess Colabawalla and Justice Firdosh Pooniwalla the IT Department has urged the bench to dismiss the same as it is a 'misconceived' plea. The affidavit filed by Sandeep Dahiya, Principal Commissioner of Income-tax (Judicial) states that the present writ petition is an abuse of the process of the law as the prayers urged in the plea have nothing to do with the Income Tax Act. "The Petitioners are trying to use the Income Tax Act to challenge the meaning of 'marriage/ wife-husband/ spouse' as statutorily understood under different marriage acts and so applied under the Income Tax Act. This in my humble submission is not permissible. The Petitioners seek to get the benefit of 'spouse' under the Income Tax without first getting their relationship legally recognised as 'marriage/ spouse/wife-husband.' I say that under the Income Tax Act, no relationship will be recognised as marriage, wife-husband, spouse, if it is not so recognised under any of the marriage act in India. The Petitioners have not brought on record any law which recognises their relationship as marriage or spouse. Rather the petitioners are trying to submit that the Income Tax Act should give the definition of marriage/spouse/wife-husband contrary to their meaning/definition under different marriage act," the IT Department said. The affidavit further states that the Petitioners have not challenged any action of the income tax authority and has neither challenged any order of the income tax authority in the instant Writ Petition. "The petition is misconceived. In the absence of any order under challenge, the petition is not maintainable as a Writ Petition. On this ground alone, the petition be dismissed," the affidavit reads. Notably, one Payio Ashiho and his partner Vivek Divan, have in their plea argued that section 56(2)(x), which grants protection to heterosexual couples, is "indirectly discriminatory" against the homosexual partners. The couple has moved the plea through their counsel Dhruv Janssen-Sanghavi.Interestingly, the couple has urged the bench to include 'same sex couples' in the proviso to section 56(2)(x), which provides exemptions only to heterosexual couples.For context, Section 56(2)(x) of the IT Act taxes any money, property, or any other assets received if their value exceeds Rs 50,000. These 'receipts' or 'gifts' under the law are categorised as 'income from other sources.' But the fifth proviso to this provision exempts from taxation, such gifts when received from 'relation', including 'spouses.'This very part of the proviso, the petitioners allege, is 'discriminatory' against same sex couples as it does not explain if the same would apply to such couples as the law does not recognise same sex partners as 'spouses.'In November last year, the bench led by Justice Colabawalla had refused to pass any interim orders in the matter. Last month, the judges had agreed to hear the final arguments on July 9. However, on Monday (July 6), Additional Solicitor General Anil Singh sought a further adjournment in the case stating that Solicitor General Tushar Mehta would be advancing submissions on behalf of the IT Department in this matter. The ASG therefore urged for a total of three weeks."We find that the above matter has been adjourned on several occasions at the instance of the Revenue. As a last chance, and considering that the Learned Solicitor General of India would be appearing in this matter, we place the above Writ Petition on board on 30th July, 2026 at 3:00 p.m. Considering that the counsel appearing for the Petitioners comes from out of India to address this Court, we have made it clear to the Revenue that no further adjournments will be granted," the judges said in the July 6 order. Accordingly, the matter will now be heard on July 30. Appearance:Advocates Dr. Dhruv Janssen Sanghavi, Tejas Popat and Aanchal Maheshwari instructed by Rashmikant and Partners appeared forthe Petitioner.Additional Solicitor General Anil Singh along with Advocate Pavan Patil represented the IT Dept. Case Title: Payio Ashihio vs Union of India (Writ Petition 3784 of 2025)Click Here To Read/Download July 6 Order

Same-Sex Couples Can't Claim 'Spouse' Benefits Under Income Tax Act Without Legal Recognition Of Marriage: IT Dept Tells Bombay High Court

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Same-Sex Couples Can't Claim 'Spouse' Benefits Under Income Tax Act Without Legal Recognition Of Marriage: IT Dept Tells Bombay High Court

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