The Allahabad High Court upheld the demand for tax and penalty imposed upon a dealer for selling 400 bags of Arecanut without an e-way bill.

The court ruled that an e-way bill must be downloaded once goods are in transit; subsequent downloading would not absolve liability under the State Goods & Service Tax Act.

The court concluded that there was an intention to evade the tax, as the goods were misclassified and taxed at 5% instead of 18%. 

Citing M/S Akhilesh Traders vs State Of U.P , it held that transporting goods without proper documents raises a presumption of tax evasion, and dismissed the petition.

The Delhi High Court upheld an arbitral award exempting Delhi International Airport Limited (DIAL) from paying annual fees to the Airports Authority of India (AAI) during the COVID-19 pandemic.

Justice Dinesh Kumar Sharma ruled that force majeure applied due to the severe financial impact on aviation. The court extended DIAL’s operational tenure by two years, rejecting AAI’s claim that the exemption was unjustified.

The tribunal found that DIAL’s losses made fee payment unfeasible, and the court upheld this, emphasizing that financial relief was not just reasonable but necessary for survival during the crisis.

The Delhi High Court has directed the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) to determine whether imposing service tax on prepaid mobile services purchased using an existing balance constitutes double taxation.

The case involved a dispute over whether tax should apply when prepaid subscribers use their balance to purchase additional services.

The petitioner argued that levying tax in such cases leads to double taxation, as the balance was already subject to tax when initially credited.

The High Court instructed CESTAT to consider the claim under Section 66 of the Finance Act, 1994 and deliver a reasonable decision. The matter remains pending before the tribunal.

The Mumbai Commissioner of Income-Tax (Appeals) [CIT(A)] ruled that taxpayers can claim the Section 87A rebate on short-term capital gains (STCG) under Section 111A, overturning tax department restrictions. 

A taxpayer, who filed ITR under the new tax regime, was denied a ₹16,422 rebate, prompting an appeal. The CIT(A) ruled that no law explicitly bars this rebate on STCG, unlike long-term capital gains under Section 112A.

Experts say this ruling strengthens taxpayers' rights, but the Income Tax Department may appeal or issue clarifications. Taxpayers facing similar issues should file appeals to claim the rebate.

The Bombay High Court is hearing the plea by Mad Over Donuts (Himesh Foods) against an INR 100 crore GST demand from DGGI.

The dispute is whether donuts should be taxed at 5% under restaurant services or 18% as bakery products.

The petitioner argues that takeaway donuts qualify as a composite supply of services under the CGST Act and it falls under restaurant services.

The court has set the next hearing for March 24, with tax authorities required to file affidavits by March 17.

The DGGI assured the court that no coercive recovery action would be taken while the case is pending.

As per Section 247 of the new Income Tax bill, authorities of the Income Tax Department may access people’s social media accounts, emails, bank accounts, online investment accounts, trading accounts, and more without prior consent, if they suspect tax evasion.

These officers can bypass passwords, override security settings, and unlock files if the access is denied. This new bill eliminates gray areas, making it legally binding for taxpayers to hand over access.

Critics argued that it violates the right to privacy secured under the Puttaswamy Judgement, to prevent the misuse.

The Supreme Court upheld the power of officers to arrest individuals under GST and Customs Acts but mandated procedural safeguards to prevent arbitrary detention.

A three-judge bench ruled that arrests must be based on cogent evidence, not mere suspicion. Officers must record reasons for arrest in writing, ensure legal representation, and follow procedural safeguards.

It clarified that tax evasion arrests can occur before a formal assessment but must be justified.

The court rejected challenges to arrest provisions while emphasizing transparency, accountability, and protection against coercion in tax recovery actions.

The Karnataka High Court has upheld the sales tax on set-top boxes, classifying them as "goods" under Section 2(15) of the KVAT Act.

The court stated that the transfer of the right to use STBs for a fee qualifies as a “sale” as defined in Section 2(29)(d).

It also supported the retrospective enforcement of the 2021 notification under Section 174(2) of the KGST Act, asserting that Section 174 guarantees the ongoing applicability of the KGST Act.

The Court dismissed allegations of double taxation, clarifying that VAT and service tax pertain to distinct elements.

The court dismissed a series of petitions filed by companies such as ACT, Tata Play, Den Network among others. 

The Supreme Court upheld the Sikkim High Court's ruling, stating that lottery distributors are not liable for service tax.

The Court ruled that the sale of lottery tickets by distributors does not qualify as a taxable service, as there is no agency relationship between the distributors and the State. 

The Court affirmed that lotteries fall under "betting and gambling," which is exclusively within the State's authority to tax under Entry 62 of the State List.

The ruling follows a previous 2024 verdict in K.Arumugham V UOI, which also determined that selling lottery tickets is a revenue activity, not a service.

The Union Cabinet approved a new Income Tax Bill, set to replace the Income Tax Act of 1961.

The bill aims to modernize and simplify India’s tax system, focusing on enhancing transparency and easing taxpayer compliance.

One of its key features is simplifying legal language to ensure that taxpayers can easily understand tax provisions.

The new legislation is part of a broader effort to reform the taxation system, making it more streamlined and efficient while removing ambiguities.

It is expected to significantly reduce legal complexities and improve taxpayer experience in India.

Recently, in the exchange filing made with the NSE and BSE, Zomato announced that the Additional Commissioner of Central GST, Gurugram, has waived ₹5.90 crore in GST for the period July 2017 to March 2021.

In April 2024, Zomato was taxed ₹11.82 crore in GST based on export services provided to its foreign subsidiaries. At that time, Zomato had said that it did not see any merit in the tax demand.

While the exact reasons for the relief were not disclosed, the decision marks a partial reprieve for the company in its ongoing tax obligations.

Volkswagen's Indian unit, Skoda Auto Volkswagen India, has sued Indian authorities to quash an "impossibly enormous" tax demand of $1.4 billion.

India claims the company misclassified imported car parts as individual components to evade higher duties.

Volkswagen argues the tax demand contradicts prior clarifications received from the government and disrupts its $1.5 billion investment in India.

The dispute, which could cost Volkswagen $2.8 billion with penalties, highlights the challenges foreign companies face with India's tax system.

The High Court in Mumbai is set to begin hearings on February 5, amid concerns over investor sentiment and the business climate.

The Indian government has proposed increasing foreign direct investment (FDI) in the insurance sector from 74% to 100%, provided foreign firms and companies invest the entire premium collected within India.

Announcing the decision in the Union Budget 2025-26, Finance Minister Nirmala Sitharaman stated, “The enhanced limit will be available for companies that reinvest all premiums domestically.”

This move follows previous FDI hikes from 26% to 49% (2015) and 49% to 74% (2021) with the aim for 'Insurance for All' by 2047.

This landmark reform is set to reshape India's insurance landscape, fostering growth, innovation, and global integration.

The Delhi High Court ruled that the license fee paid by IP law firm Remfry & Sagar to acquire the goodwill vested in a company is a legitimate business expense deductible under Section 37 of the Income Tax Act.  

This case involved a fee paid by Remfry & Sagar to Remfry & Sagar Consultants Private Limited (RSCPL), a company owned by the founder’s family, for the use of goodwill.

The Assessing Officer (AO) disallowed the deduction, calling it a "colourable transaction" to divert funds.

The High Court dismissed the appeal, affirming that Goodwill is a valid business asset and payment for its use is not illegal, the transaction was not a tax avoidance scheme.