Tax Weekly Round-Up: July 28 - August 03, 2025

HIGH COURTSAllahabad HCBurden To Prove That Best Assessment By Income Tax Authorities Is Perverse Is On Assesee: Allahabad High CourtCase Title: M/S Rai Wines Ras Bahar Colony v. The Commisssioner Of Income TaxCase no.: INCOME TAX APPEAL No. - 395 of 2007The Allahabad High Court has held that the burden to prove that the findings of best assessment done by the authorities is perverse is on the assesee.The bench of Justice Shekhar B. Saraf and Justice Praveen Kumar Giri held that “when a best assessment is done, it is for the assessee to bring on record the facts that may reveal that the findings are perverse in nature.”Bombay HCIncome Tax | Sale Proceeds Of One House Used For Purchasing Multiple Residential Houses Qualifies For Exemption U/S 54(1): Bombay High CourtCase Title: Krishnagopal B. Nangpal v. Dy. Commissioner of Income Tax Special Range – 3, PuneCase Number: INCOME TAX APPEAL NO. 569 OF 2003The Bombay High Court held that sale proceeds of one residential house, used for purchase of multiple residential houses, would qualify for exemption under Section 54(1) of the Income Tax Act.The issue before the bench was whether Section 54(1) of the Income Tax Act allows the Assessee to set off the purchase cost of more than one residential units against the capital gains earned from sale of a single residential house.Calcutta HCMere Incorporation Of Investing Companies Under Companies Act Not Enough To Prove Genuineness Of Share Transactions: Calcutta High CourtCase Title: Principal Commissioner of Income Tax - 2, Kolkata v. Minto Park Estates Private LimitedCase Number: ITAT/4/2025 (IA NO: GA/2/2025)The Calcutta High Court held that mere incorporation of investing companies under the Companies Act is not enough to prove the genuineness of share transactions.The bench opined that, admittedly, the shares were by way of a private placement. Though the investing companies might have been incorporated under the provisions of the Company's Act, that by itself will not validate the transaction.Stock Exchange & Banking Channels Cannot Mask Sham Transactions Carried Out Through Bogus Capital Loss Claim Companies: Calcutta High CourtCase Title: Principal Commissioner of Income Tax Central - 2, Kolkata v. M/s. Zulu Merchandise Private LimitedCase Number: ITAT/88/2025 (IA NO: GA/2/2025)The Calcutta High Court held that stock exchange and banking channels cannot mask sham transactions carried out through bogus capital loss claim companies.Justices T.S. Sivagnanam and Chaitali Chatterjee (Das) observed that “the entire information contained in the investigation report was apprised to the assessee by the assessing officer and thereafter the show cause notices was issued for which the assessee' submitted their reply and in the reply they did not raise any issue that they were unaware about the investigation report but made a vague and unsubstantiated statement stating that the transaction was in the normal course of business.”Delhi HCDelhi High Court Reprimands GST Dept For Raiding Lawyer's Office, Seizing Computer Over Client's Tax CaseCase title: Puneet Batra v. Union of IndiaCase no.: W.P.(C) 11021/2025The Delhi High Court has pulled up the GST Department for harassing a tax lawyer, by raiding his offices and seizing his files and electronic gadgets, in connection with alleged GST evasion by one of his clients.A division bench of Justices Prathiba M. Singh and Shail Jain observed that unless the Department has some material to indicate the lawyer's involvement in alleged tax evasion, it cannot take such steps against him.Jammu & Kashmir & Ladakh HC[CGST Act] Penalty Is An 'Additional Tax', Cannot Be Levied Under State Act Without 'Charging Provision': J&K&L High CourtCase-Title: Commissioner State Taxes and anr. Vs M/s Reliance Jio Infocomm Limited, 2025The Jammu & Kashmir and Ladakh High Court has ruled that the penalty under the Central Sales Tax Act cannot be imposed by invoking provisions of the State Act in the absence of an express charging section. The Court held that the Central Act is a “self-contained code” and provides its own framework for imposition of penalties, which cannot be supplemented by state laws.A bench headed by Justice Sanjeev Kumar, Justice Sanjay Parihar dismissed the petition challenging the absence of a penalty under Section 6 of the J&K Entry Tax Act, 2000, and underscored the constitutional mandate under Article 265 of the Constitution, which provides that no tax shall be levied or collected except by authority of law.Kerala HCKVAT Act | Input-Tax Credit Can Be Availed If Purchaser Has Genuine Invoices Even If Seller Fails To Remit Tax: Kerala High CourtCase Title: S.P. Faizal v. State of KeralaCase Number: ICR (OT.REV) NO. 3 OF 2025The Kerala High Court, overruling its earlier decision in C.P. Rasheed v. State of Kerala, has held that input tax credit can be availed under the Kerala Value Added Tax Act, 2003 if the purchaser has genuine tax invoices even if the seller fails to remit...

Tax Weekly Round-Up: July 28 - August 03, 2025

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Tax Weekly Round-Up: July 28 - August 03, 2025

LIVELAW NEWS NETWORK

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