Tax INFORM- April 2026

The sixty-third issue of our monthly tax newsletter, Tax Inform, is out. Through these newsletters, we provide a compilation of key tax-related case laws, circulars, notifications, etc. issued by the authorities in the previous month, impacting entities and individuals operating in India.

The highlights of the current issue are:

Direct Tax:

Domestic Tax Rulings:

• SC holds that accumulated losses of an amalgamating company cannot be set off against the income of the amalgamated company under the Kerala Agricultural Income Tax Act.
• SC dismisses Revenue’s SLP, affirming that Coursera’s receipts from online course access are not taxable as fees for included services under the India–USA DTAA.
• Madras HC holds that replacement of machinery resulting in enduring benefit constitutes capital expenditure and cannot be treated as ‘current repairs’.
• Bombay HC holds that an assessee has an absolute right to seek revision under Section 264 and that penalty cannot be imposed on debatable issues.
• Delhi HC holds that buy-back of shares is a capital reduction and not an acquisition of property, and therefore cannot be taxed under Section 56(2)(x).
• Delhi HC quashes rejection of lower TDS certificate under Section 197 as arbitrary and mandates adherence to Rule 28AA parameters.
• Bombay HC holds that Assessing Officer cannot go behind the profit and loss account while computing book profits under Section 115JB.

Notifications/Circulars:

• CBDT notifies the India–Brazil DTAA amending Protocol, introducing LOB, FTS article, and revised withholding tax framework effective FY 2026–27.

Indirect Tax: 

Goods & Services Tax

Case Laws:

• SC upholds denial of anticipatory bail and affirms that GST offences involving amounts below ₹5 crore are non-cognizable and bailable.
• J&K HC holds that M.S. Scrap generated during manufacture qualifies as “specified goods” and is eligible for reimbursement under the Budgetary Support Scheme
• Bombay HC quashes bank account attachment for non-compliance with statutory safeguards and holds such coercive action violative of Article 300A.
• Bombay HC quashes composite SCN covering multiple financial years and holds that GST notices must be issued year-wise.
• Telangana HC directs issuance of separate DRC-07 orders and temporary registration to enable Managing Director to avail appellate remedy.