#[Banking & Finance Law]

ITAT Agra held that a government polytechnic could claim Section 10(23C)(iiiad) exemption for AY 2020-21 without filing a Section 139(4C) return, as the filing condition was introduced only by the Finance Act 2022 amendment. The ruling confirms pre-amendment non-filing was not a condition precedent, aiding institutions that missed prior deadlines.

ITAT Kolkata held that reassessment beyond three years under Section 148 mandates PCCIT or CCIT sanction under Section 151; PCIT approval is jurisdictionally invalid. The tribunal quashed a notice where only PCIT approval was obtained, reinforcing the strict hierarchy for time-barred proceedings and protecting taxpayers from procedurally flawed orders.

CESTAT held that airline cancellation fees are liquidated damages, not a separate service taxable under Section 66E(e) Finance Act 1994. The ruling exempts airlines from paying service tax on penal charges, affecting carriers and passengers.

The ITAT Kolkata held that depreciation can be claimed on goodwill/brands acquired in a demerger under Section 32 of the Income Tax Act, and that a disallowance under Section 14A requires the Assessing Officer to record dissatisfaction with the taxpayer's apportionment. The decision impacts companies undertaking demergers seeking to amortise intangible assets and clarifies the procedural requirement for Section 14A disallowances.

The ITAT Delhi held that reassessment under section 148 is valid only if the escaped income is an asset as per Explanation 2 to section 153A, noting that unsecured loans received by the assessee qualify as such assets and that liability-side entries do not defeat the extended limitation when the escaped amount exceeds ₹50 lakh.

NCLAT held that the IBBI Liquidation Process (Second Amendment) Regulations, 2025 apply prospectively only and cannot affect liquidation already started under the earlier regime. The ruling shields ongoing liquidation from retrospective changes, impacting creditors, liquidators and purchasers.

CESTAT Allahabad held that accepting an enhanced customs value in writing does not waive the right to appeal under Section 128, Customs Act, 1962. It confirms that such acceptance does not invoke estoppel, safeguarding importers who may inadvertently acknowledge higher valuations during clearance.

The NCLAT held that a without-prejudice deposit cannot substitute the mandatory adjudication of debt, default, and maintainability under Section 7 IBC. Setting aside an NCLT order that closed proceedings upon deposit, the tribunal ruled such deposits do not dispense with the creditor's right to a full determination of statutory prerequisites for CIRP initiation.

The NCLAT Principal Bench ruled that Section 60(2) IBC mandates personal guarantor insolvency proceedings to be heard by the same NCLT bench adjudicating the corporate debtor's CIRP. The tribunal upheld the New Delhi Principal Bench's refusal to transfer a guarantor's case to Chandigarh, confirming that jurisdiction vests exclusively with the bench seized of the main corporate insolvency process.

ITAT Delhi rules a Mauritius entity holding a Category I GBL licence, FPI registration, and actual control over ECB funds satisfies the beneficial ownership test under Article 11 for interest income on ECBs lent to Indian group companies. The tribunal also denies the Section 194LD concessional withholding rate for non-convertible debentures.

The court ruled that a secured creditor in a SARFAESI auction must disclose known material encumbrances like unearned increase (UEI) charges, holding that an 'as is where is' clause does not override this statutory duty. Indian Bank was directed to pay UEI charges for four auctioned plots, with conveyance deeds to follow within four weeks. The ruling safeguards auction purchasers from hidden liabilities and mandates transparency in distressed asset sales.

The tribunal ruled that TDS credit under Section 205 is based on actual tax deduction, not merely Form 26AS reflection, and remanded the case for verification of the disputed Rs 43.72 lakh credit. This protects taxpayers from losing legitimate credits due to deductors' filing delays or errors.

The NCLAT ruled that the Adjudicating Authority possesses residuary jurisdiction under Section 60(5)(c) of the IBC to issue consequential directions necessary for implementing a going concern sale during liquidation. The tribunal extended the 'clean slate' doctrine - typically applied in resolution plans - to liquidation proceedings, ensuring that a successful auction purchaser receives the corporate debtor's assets free from encumbrances. This decision clarifies the AA's powers to facilitate liquidation sales and protects buyers from legacy claims, impacting liquidators, successful bidders, and secured creditors.

CESTAT Bangalore ruled that the Self Employed Women's Association (SEWA), a member-based trade union, does not qualify as a 'manpower recruitment or supply agency' under the Finance Act, 1994, because the workers are members of the organisation rather than employees deployed through an intermediary service. The decision clarifies that the mutuality principle excludes such collective self-employment arrangements from service tax liability, impacting similar member-driven collectives and cooperatives.

The ITAT Delhi held that satisfaction recorded after 1 April 2021 invalidates a Section 153C search assessment, mandating reassessment under Section 148 instead. The ruling clarifies the procedural switch introduced by the Finance Act 2021 amendment, directly impacting assessees and tax authorities in search-related proceedings.