On January 29, 2026, the High Court of Madras made a decision in favor of M/s Apollo Infrastructure Projects Finance Co Ltd. regarding a disagreement over tax exemption with the Commissioner of Income Tax, Chennai.
The case was about whether M/s Apollo Infrastructure could get a tax break under Section 10(23G) of the Income-Tax Act for long-term capital gains from selling shares in PPN Power Generating Co. Ltd. The shares were bought between April 1991 and June 1998, which caused questions about whether they could get the tax break since the law only applied after June 1998.
The Income Tax Appellate Tribunal in Chennai had earlier decided in favor of M/s Apollo Infrastructure. The Tribunal said that the company could get the tax break, even though the investments were made before the specified date. The Commissioner of Income Tax disagreed with this decision and appealed.
Dr. Justice Anita Sumanth and Mr. Justice Mummineni Sudheer Kumar were in charge of the case. They agreed with the Tribunal's decision, referring to a similar case (T.C.A.No.417 of 2009) decided on December 9, 2025, where the court ruled against the tax authorities.
"The appeal filed by the Revenue is, accordingly, dismissed. There shall be no order as to costs."
The tax authorities argued that since the shares were bought with borrowed money, the interest and finance charges should not be deductible. However, the Court disagreed, noting that M/s Apollo Infrastructure did not earn any tax-free income or dividends during the relevant period.
The Court rejected the appeal by the Commissioner of Income Tax. Both legal questions were settled against the tax authorities, confirming that M/s Apollo Infrastructure was rightfully entitled to the tax break.
