Author: Adv. Fiza Ahmand

Supreme Court: Non-Resident Companies Can Be Taxed in India Even Without a Permanent Office

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The Supreme Court has ruled that a non-resident company can be taxed in India on income that accrues or arises from a business connection in the country, even without a permanent office or physical presence. Deciding in Pride Foramer S.A. v. Commissioner of Income Tax (2025 INSC 1247), the Court restored Income Tax Appellate Tribunal relief to the company and overturned the Uttarakhand High Court’s restrictive stance. It clarified that a “permanent establishment” applies under tax treaties, not domestic law, and directed reassessments accordingly. The judgment emphasizes that bids and correspondence can demonstrate ongoing business activity in India.

SC: Public Possession Must Be Proven for Valid Oral Gift (Hiba) Under Muslim Law as Lack of Mutation Creates Doubt

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The Supreme Court clarified key principles on oral gifts (Hiba) under Mohammedan law in *Dharmrao Sharanappa Shabadi v. Syeda Arifa Parveen* (October 7, 2025). It ruled that oral gifts cannot be “surprise instruments” and must meet three simultaneous conditions: donor’s declaration, donee’s acceptance, and delivery of possession. Without evidence like mutation or acts of ownership, the gift claim fails. The Court set aside the Karnataka High Court ruling and held the 2013 suit time-barred, stressing strict proof and possession as decisive for validating Hiba claims.