Bombay HC Refuses Interim Relief To Same-Sex Couple Challenging Income Tax Act Provision On Gift Exemption

Mumbai: The Bombay High Court on Thursday refused to grant interim relief to a same-sex couple challenging the constitutional validity of Section 56(2)(x) of the Income Tax Act, which provides tax exemption on gifts exchanged between heterosexual spouses.

A bench of Justices Burgess Colabawalla and Amit Jamsandekar heard brief arguments from petitioners, who contended that the provision is “indirectly discriminatory” as it excludes same-sex partners from the exemption extended to heterosexual couples.

Petitioners Argue Indirect Discrimination

The couple has sought inclusion of same-sex partners in the proviso to Section 56(2)(x), which exempts from taxation gifts received from “relatives,” including “spouses.”

The petitioners argued that while the law’s intention may not be discriminatory, its impact clearly is, since same-sex partners are denied equal tax benefits. They urged that the court decide the plea before December 31, 2025—the deadline for compliance with the provision.

Bench Says No Interim Relief Possible

The bench, however, declined to pass any interim order. “We cannot pass interim orders. Everyone has to pay tax; if you succeed, you’ll get your money back. The alleged discrimination is by the State, not by us,” Justice Colabawalla said.

Centre Yet to Finalise Its Stand

Additional Solicitor General Anil Singh, representing the Income Tax Department and the Centre, informed the court that while the department has filed its reply, the government is yet to decide whether to adopt it or file a separate affidavit.

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He submitted that the Supreme Court’s Constitution Bench had already held that recognition of same-sex unions requires legislation, not judicial intervention.

Matter Posted for Detailed Hearing in December

The court adjourned the matter for detailed hearing in the second week of December.

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