ITAT Mumbai Upholds Tax Certainty for Category III AIFs

In a significant ruling delivered in the case of 360 One Core Aggressive, the Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has reinforced crucial tax principles for Category III Alternative Investment Funds (AIFs).

Independent Director Eligibility – Cousin of Promoter/Promoter Group Member is Eligible

 In a recent informal guidance letter, SEBI clarified whether a cousin of a Promoter Group member qualifies as a person ‘related to promoters or directors’ for the purposes of Independent Director eligibility under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘LODR Regulations’) and concluded that such a relationship, standing alone, does not trigger disqualification.

Background

olkata ITAT reaffirms that suspicion alone cannot justify additions under Section 68 (Unexplained Cash Credits)

 Recently, the Kolkata ITAT in Action Tie-up Pvt. Ltd. v. DCIT ruled in favour of the taxpayer and reiterated that additions towards alleged bogus sale transactions cannot be sustained merely on the basis of suspicion, third-party statements, or general allegations of accommodation entries, especially where the taxpayer has furnished complete documentary evidence supporting the transactions.

In the present case, the assessee company had sold investments in unlisted shares during the relevant assessment years. The tax authorities alleged that the transactions were accommodation entries and treated the sale proceeds as unexplained cash credits. The allegation was primarily based on statements recorded from certain third parties during search proceedings and the observation that some purchaser entities were subsequently struck off by the Registrar of Companies. The Assessing Officer further alleged that the assessee and related entities were merely “pass-through” or “shell” entities facilitating accommodation entries.

However, the assessee submitted detailed documentary evidence to substantiate the genuineness of the transactions, including audited financial statements, bank statements, confirmations, income tax records, details of investments held over multiple years, and responses received directly from purchasers in compliance with notices issued by the department. It was also highlighted that the investments had been acquired in earlier years and accepted by the department in scrutiny assessments.

The Hon’ble Tribunal, after examining the facts and legal position, ruled in favour of the assessee and made the following key observations:

SC holds GST is leviable on supply of actionable claim in online gaming, fantasy sports and casinos, retrospectively from July 2017

This Tax Alert summarizes a recent ruling  of the Supreme Court (SC) addressing the GST implications on online gaming, fantasy sports and casino transactions, including constitutional validity of levy on actionable claims and the valuation mechanism prescribed under the Central Goods and Services Tax Act, 2017 (CGST Act) and the Rules framed thereunder.

The key observations of the SC are:

Gains from Derivatives based trading income not taxable in India but only in Mauritius

 Under Article 13(3A) of the India-Mauritius DTAA capital gains from the transfer of shares of an Indian company acquired by a Mauritius resident on or after 1 April 2017 are taxable only in India. Article 13(4) provides that capital gains from transfer of any other property not covered specifically under any other Para of the said article, are taxable in the country of residence of the transferor, i.e., Mauritius.

GST Not Leviable on Transfer of Leasehold Rights of MIDC Plots: SC Dismisses Revenue’s SLP

 In a significant development, the Supreme Court has dismissed the Revenue’s Special Leave Petition (SLP) challenging a Bombay High Court (Nagpur Bench) ruling in the case of Aerocom Cushions Private Limited v. Assistant Commissioner. The High Court had previously held that the assignment of leasehold rights in an industrial plot allotted by the Maharashtra Industrial Development Corporation (MIDC) does not constitute a “supply of services” under Section 7 of the CGST Act, and therefore is not subject to GST.

Tax Due Date - June 2026.

 

Sr No	Due Date	Related to	Compliance to be made
1.	11.06.2026	GST	Filing of GSTR1 for the month of May 2026
2.	13.06.2026	GST	ISD Return

3.	20.06.2026	GST	Payment of GST for the month of May 2026 Filing of GSTR 3B for the month of May 2026
4.	7.06.2026	TDS/TCS (Income Tax)	Deposit TDS for payments of Salary, Interest, Commission or Brokerage, Rent, Professional fee, payment to Contractors, etc. during the month of May 2026. · Deposit TDS from Salaries deducted during the month of May 2026 • Deposit TCS for collections made under section 394 including sale of scrap during the month of May 2026, if any
5	15.06.2026	Income tax	Payment of Advance tax for the Corporate assesses –Amount not less than 15% of advance tax.

The E-Rupee Paper Trail: Vouching in the CBDC Era

Let’s start with a small story in this regard. Client B, a forward-thinking wholesale distributor of electronic components, decided to participate in the Reserve Bank of India’s corporate pilot for the Central Bank Digital Currency (CBDC), the e-Rupee (e₹). Mr. A, the managing director, was thrilled. By using the e-Rupee for massive B2B vendor settlements, the company bypassed weekend RTGS delays and traditional banking transaction fees, achieving instant, real-time finality.

Kolkata Tribunal Rules Compensation for Settling Litigation Is Non-Taxable When Only 'Right to Sue' Is Surrendered

 In a recent ruling, the Kolkata Income Tax Appellate Tribunal (ITAT) held that compensation received by a taxpayer to settle ongoing disputes and withdraw pending litigation constitutes a non-taxable capital receipt, provided the taxpayer merely gave up its ‘right to sue’ and no enforceable contractual right existed.

Depreciation Allowed on Workforce Intangible Acquired under Slump Sale

 In a recent ruling, the Delhi Tribunal held that depreciation is allowable on intangible assets in the form of “workforce” acquired pursuant to a slump sale transaction, where such assets have been independently valued and form part of the consideration paid for acquisition of the business as a going concern.