Section 10(37) of the Income Tax Act

Income-tax Act, 2025: s.11

Section 10(37) falls under section 10 of the Income-tax Act, 1961, which corresponds to section 11 (Incomes not included in total income) of the Income-tax Act, 2025.

Read section 11 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 10(37) is CIT v. Sunbeam Auto Ltd. (332 ITR 167), cited in 897 of the 558 judgments on BharatTax that turn on this section.

Leading authorities on Section 10(37)

CIT v. Sunbeam Auto Ltd.
332 ITR 167 · 2011 · High Court
897
citing judgments

The Commissioner cannot revise an assessment under Section 263 merely because the assessment order does not explicitly reflect an inquiry, or because the Commissioner holds a different opinion. An inquiry, even if considered inadequate, or an assessment based on a plausible view by the Assessing Officer after due examination, does not automatically make the order erroneous or prejudicial to the interests of the revenue.

ITO v. D.G. Housing Projects Ltd.
343 ITR 329 · 2012 · High Court
438
citing judgments

For exercising revisional jurisdiction under Section 263, the Commissioner must first find that the Assessing Officer's order is erroneous and unsustainable in law, as this is a condition precedent. An order is not erroneous merely because two views are possible, or if the Commissioner disagrees with the Assessing Officer's permissible view, or to simply remit the matter for further enquiries.

CIT v. Ghanshyam (HUF)
315 ITR 1 · 2009 · Supreme Court
363
citing judgments

Interest received under Section 28 of the Land Acquisition Act, 1894, is considered part of the enhanced compensation on compulsory acquisition of land. It is taxable as 'capital gains' and not separately as 'interest income' under the head Income from Other Sources.

Shyam Sunder v. Ram Kumar
8 SCC 24 · 2001 · Supreme Court
263
citing judgments

A statutory explanation that is clarificatory in nature applies retrospectively from the date the main provision came into force. However, if an explanation changes the law, it is not presumed to be retrospective, even if phrases like 'it is declared' or 'for the removal of doubts' are used.

Shyam Sunder v. Ram Kumar, (2001) 8 SCC 24 (para 44); Brij Mohan Das Laxman Das v. CIT
5 SCC 482 · 1997 · Supreme Court
261
citing judgments

For income to be assessable under the head 'Income from House Property' as per Section 22 of the Income Tax Act, 1961, beneficial ownership or the right to enjoy the property is sufficient; legal ownership is not a mandatory prerequisite.

Rama Bai v. CIT
181 ITR 400 · 1990 · Supreme Court
258
citing judgments

Interest income is taxable on either an accrual or cash basis, determined by accounting principles. This method was applicable prior to legislative changes that simplified the taxation of interest income.

KOTAK MAHINDRA CO. LTD. AND ANOTHER. 367 50.(1987) 3 SCC 544: MADHAV AYAWADANRAO HOSKOT v. STATE OF MAHARASHTRA. 51
10 SCC 1 · 2014 · Supreme Court
250
citing judgments

The judgment in Kotak Mahindra Co. Ltd. does not appear to be directly cited for a specific income tax proposition in the provided passages. The passages merely list it as one of several cases cited in subsequent judgments, without detailing its specific contribution to the legal reasoning.

Narayan Tatu Rane v. ITO
70 Taxmann.com 227 · 2016 · ITAT
220
citing judgments

Before revising an assessment order under Section 263, the CIT/PCIT must conduct their own inquiries or verifications to establish that the Assessing Officer's order is erroneous and unsustainable in law, rather than merely directing further inquiry or pointing out the AO's lack of inquiry.

Reliance Jute and Industries Ltd. v. CIT
1 SCC 139 · 1980 · Supreme Court
214
citing judgments

The cardinal principle of tax law dictates that the law applicable to an assessment is the law in force for the relevant assessment year, unless the statute expressly or implicitly provides otherwise. A clarificatory statutory explanation must be read into the main provision from its inception.

CIT v. Govindbhai Mamaiya
91 Taxmann.com 20 · 2018 · Supreme Court
205
citing judgments

Interest on enhanced compensation received under Section 28 of the Land Acquisition Act, 1894, is considered part of the compensation, not merely interest income, and is exigible to tax on a receipt basis.

Judgments on Section 10(37)

The ITO-Ward-3(3)(3), Surat vs. Shri Navinchandra Babulal Nagarseth, Surat

In the result, the appeal of the assessee stands allowed

ITA 1130/AHD/2016[2008-09]Status: DisposedITAT Surat18 Jul 2019AY 2008-09

Bench: Shri H.S. Sidhu & Shri O.P. Meenaassessment Year: 2008-09 The Income Tax Officer, Vs. Shri Navinchandra Babubhai Ward-3(3)(3), Surat. Nagarsheth, 11/497, Opp.Jain Temple, Kabutarkhana, Vada Chouta, Surat – 395 003. [Pan: Aappn 6427 P] (Appellant) (Respondent) Assessee By Shri Sapnesh Sheth – Ca Department By Shri R.P.Rastogi – Sr.Dr Date Of Hearing 17.07.2019 Date Of Pronouncement 18.07.2019 Order Per H.S. Sidhu, Jm: This Appeal Filed By The Assessee Against The Impugned Order Passed By The Ld.Commissioner Of Income Tax(Appeals)-2, Surat Dated 07.11.2016 Pertaining To Assessment Year 2012-13. 2. Ground Raised By The Revenue Reads As Under: “1. On The Facts & Circumstances Of The Case & In Law, The Ld.Cit(A) Has Erred In Not Upholding The Action Of The Ao In Withdrawing The Exemption Claimed U/S.10(37) Of The Act Amounting To Rs.1,45,86,598/-. 2. On The Facts & Circumstances Of The Case & In Law, The Ld.Cit(A) Has Failed To Appreciate The Fact That The Assessee Did Not Use The Land For Agricultural Purpose During The Period Of 2 Years Immediately Preceding The Date Of Transfer. The Assessee Failed To Submit Documentary Evidence To Substantiate That The Land Was Used For Agricultural Purpose For F.Y. 2006-07. The Assessee Had Not Showed Any Agriculture Income Offered For Taxation In His Return Of Income In The Immediate Previous Years. 1

Section 10(37)