Supreme Court & High Courts Weekly Round-Up

The Supreme Court dismissed the Special Leave Petitions filed by the Income Tax Department, upholding the Madras High Court’s ruling that reinsurance premiums paid to foreign entities are not taxable in India.

The case arises from a common judgment of the Madras High Court in Cholamandalam MS General Insurance Company Limited where the High Court ruled in favour of the assessee on multiple issues relating to taxation of insurance companies.

The Chhattisgarh High Court rejected the State’s argument, holding that the statutory language of Section 206C(1C) encompasses transfers of rights “otherwise” and does not exclude illegal transactions. The Court emphasized that the compounding mechanism under Section 23A of the MMDR Act and Rule 71(5) of the 2015 Rules results in a form of economic benefit derived from mining activity, thereby attracting TCS.

After considering the matter, the Supreme Court, led by Justices Dipankar Datta and Satish Chandra Sharma, declined to interfere with the High Court’s reasoning and dismissed the SLP on 6 April 2026, sealing the interpretation that compounding fees from illegal mining are subject to tax collection at source.

HIGH COURT

Chhattisgarh HC sets aside Order u/s 148A(d), Directs Reconsideration as per SC Rulings on Reassessment Notices

Abis Exports India Private Limited vs Union Of IndiaThrough Secretary CITATION : 2026 TAXSCAN (HC) 536

The Chhattisgarh High Court set aside the order passed under section 148A(d) of the Income Tax Act, 1961 rejecting the objections of the petitioner to initiation of reassessment proceedings and directed the Assessing Officer (AO) to reconsider the matter .

In the light of facts and circumstances the high court set aside the order passed under section 148A(d) of the Income Tax Act, along with consequential proceedings and directed the AO to provide an opportunity to the petitioner to file fresh objections within a period of 90 days and thereafter dispose of the same in accordance with law, after granting a reasonable opportunity of hearing.

Supreme Court Dismisses 411-Day Delayed SLP, No Interference with HC Ruling Quashing Income Tax Notice Issued 6 Years from A.Y.

ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL vs WAVESILVER TOWER PRIVATE LIMITED

CITATION : 2026 TAXSCAN (SC) 176

The court explained that in light of this amendment, the basis of the demand raised against the petitioner no longer survives and the petitioner is entitled to the benefit of the extended time limit. The court held that the Order-in-Original dated 07.02.2024 could not be sustained in view of the amended provision.

The court set aside the Order-in-Original and disposed of the writ petition with a direction to the petitioner to pay Rs. 10,214 along with Rs. 553 as interest within 30 days from receipt of the order. The writ petition was disposed of accordingly.

The Division Bench of Justice Dinesh Mehta and Justice Vinod Kumar observed that uninterrupted power supply is necessary for the proper functioning of computers and that UPS cannot be treated merely as an accessory. The Court observed that UPS is an integral part of the computer system.

The court explained that if uninterrupted power supply is not ensured, it would directly impact the functioning and operations of the computer systems used by the assessee. It pointed out that the Assessing Officer had erred in allowing depreciation at a lower rate.

GST Appeal Filed Beyond 120-Day Limit Not Condonable: Jharkhand HC Dismisses Writ Petition

M/s V.S. Enterprises through its Proprietor vs Union ofIndia through the Commissioner CITATION : 2026 TAXSCAN (HC) 537

The Jharkhand High Court held that a writ petition cannot be entertained where a taxpayer fails to file a statutory appeal within the prescribed limitation period of 120 days under the GST law, and such delay cannot be condoned by invoking writ jurisdiction.

The Division Bench comprising Chief Justice M. S. Sonak and Justice Rajesh Shankar observed that the petitioner had an adequate statutory remedy but failed to exercise it within the time allowed under law.

The court held that since the petitioner did not file the appeal within the prescribed time and approached the High Court after the expiry of limitation, the writ petition could not be entertained. The court dismissed the writ petition and declined to grant any relief. No costs were imposed.

No GST on Commission Paid to Bank's Pigmy Agents as they are Employees, Not Business Facilitators: Karnataka HC

M/S. KARNATAKA VIKAS GRAMEENA BANK vs DEPUTY COMMISSIONEROF COMMERCIAL CITATION : 2026 TAXSCAN (HC) 546

The Karnataka High Court held that no Goods and Service Tax (GST) is payable on commission paid by a bank to its pigmy agents as they are employees and not business facilitators and services rendered by them fall outside the scope of taxable supply.

Justice M. Nagaprasanna observed that the real relation between bank and pigmy agents must be seen. The court saw that the bank has control over the work of the pigmy agents and that they follow bank instructions and deposit collections regularly.

The court explained that even though payment is called commission, it is like wages and shows employer-employee relationship. It also observed that services by employees are not supply under GST and cannot be taxed.

Income Tax Dept Delays in Making ITR Forms & Utilities Available: Gujarat HC Hears CA Association’s Plea

CHARTERED ACCOUNTANTS ASSOCIATION, SURAT (CAAS) & ORS.vs UNION OF INDIA & ORS. CITATION : 2026 TAXSCAN (HC) 545

The GujaratHigh Court heard a petition filed by the Chartered Accountants Association, Surat (CAAS) and others raising issues regarding delay in making income tax return (ITR) forms and utilities available for e-filing.

The Division Bench comprising Justice A.S. Supehia and Justice Pranav Trivedi observed that the petition raised serious issues relating to the functioning of the respondent department.

The court also directed the Registry to delete the name of Mr. Chaitanya S. Joshi from the record as he was not appearing on behalf of the respondents.

GST Authorities cannot Insist on Taxpayer’s Personal Appearance: Allahabad HC says ‘Lawyer Representation’ Sufficient

Nishu vs The Union of India & Ors. CITATION : 2026 TAXSCAN (HC) 542

The AllahabadHigh Court has held that GST authorities cannot insist on the personal appearance of a taxpayer when the law expressly allows representation through an advocate. The Court also directed that detained goods be released upon payment of the statutory penalty under Section 129(1)(a) of the Central Goods and Services TaxAct, 2017.

The bench directed the authorities to hold a hearing on April 10, 2026, allowing petitioner counsel to appear on her behalf, and to notify Maa Kali Traders within 24 hours. If the petitioner deposits the penalty under Section 129(1)(a), the goods and vehicle must be released within 48 hours, subject to her right to appeal.

TMT/CTD Scrap Treated as ‘Specified Goods’: J&K HC directs Budgetary Support Reimbursement

M/s Vijay Steel Industries vs UT of Jammu & Kashmirthrough State Tax Officer CITATION : 2026 TAXSCAN (HC) 544

The High Court of Jammu & Kashmir and Ladakh held that scrap generated during the manufacturing of TMT/CTD bars qualified as “specified goods” and directed reconsideration of reimbursement under the Budgetary Support Scheme

The Court observed that merely because the unit was registered for TMT/CTD bars does not mean that products emerging from the same manufacturing process lose their character as manufactured goods. Since the scrap retained the essential character of the final product and was marketable, it could not be treated as mere waste.

Rejecting the department’s narrow interpretation, the Court held that denial of reimbursement solely on the ground that scrap is not separately specified was unjustified. Relying on this, the High Court quashed the rejection order dated 01.07.2022. It directed the authorities to reconsider the petitioner’s claim afresh within one month, keeping in view the observations made in the judgment.

Income Tax Reassessment Beyond 6 Years Invalid Without Existence of ‘Asset’: Delhi HC Quashes Notice

DEEPAK NAGAR vs ASSISTANT COMMISSIONER OF INCOME TAX CITATION : 2026 TAXSCAN (ITAT) 373

The Delhi High Court has held that income tax reassessment beyond six years is invalid in the absence of any allegation regarding the existence of an “asset” and quashed the notice issued under Section 148 along with all consequential proceedings.

The court explained that for invoking the extended limitation period of ten years under Section 149, the escaped income must be represented in the form of an asset. It pointed out that in the absence of such a finding, the Assessing Officer could not rely on the extended period and was restricted to the normal limitation period of six years.

The court held that since the notice was issued beyond six years and the jurisdictional requirement of existence of an asset was not satisfied, the reassessment proceedings were without jurisdiction. The High Court quashed the notice issued under Section 148, the assessment order, and all consequential proceedings, and allowed the writ petition.