Tax INFORM- July 2025

The fifty-fourth 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:

• Assessment proceedings cannot be continued during moratorium under IBC: Bombay HC.
• Assessee entitled to depreciation on revalued cost of assets post partnership takeover: Madras HC.
• Flower bed, window projections, and service area not part of “built-up area” for Section 80IB(10) deduction: Bombay HC.
• CBDT cannot impose time limit for filing compounding applications; Clause 7(ii) already struck down: Madras HC.
• Telangana HC reaffirms that regular payments to parent company in ordinary course of business cannot be treated as ‘deemed dividend’ under Section 2(22)(e).

Notifications/ Circulars:

• Notification No. 67/2025, dated June 20, 2025.
• Notification No. 69/2025, dated June 25, 2025.

Indirect Tax: 

Goods & Services Tax

Case Laws:

• Blocking of input tax credit ledger under Rule 86A cannot exceed 10% of the demand: SC upholds P&H HC interim relief.
• Refund of transitioned credit upheld; SC dismisses Revenue’s SLP with cost for suppressing precedent.
• SC deprecates misuse of voluntary bail conditions; remands matter for fresh consideration.
• Inter-State transfer of ITC allowed on amalgamation despite portal constraints; Section 18(3) permits it: Bombay HC.
• Service of notices via registered email and mobile number is valid under Section 169; writ not maintainable: Allahabad HC.

Customs Duty

Notifications/ Circulars:

• CBIC Circular No. 17/2025-Customs dated June 19, 2025.
• CBIC Instruction No. 23/2025-Customs dated July 15, 2025.