Issues: Whether excise duty on goods manufactured by the contract manufacturer on job-work basis was recoverable from the appellant, who supplied raw materials and tools but did not itself undertake the manufacturing activity.

Analysis: The manufacturing activity was carried out by the contract manufacturer at its own premises with its own labour, machinery and resources, while the appellant merely supplied inputs and certain tools. The agreement described the parties as independent contractors, showing that the relationship was not one of agent and principal. Under the scheme of central excise, duty attaches to the person who actually undertakes manufacture, and ownership of the goods is not decisive. The relied upon notifications did not shift the duty liability to the supplier of raw materials in the absence of manufacture by that supplier. The precedents applied by the Tribunal consistently held that, in a genuine job-work arrangement, the job worker is the manufacturer and the duty liability remains on the job worker unless a valid statutory mechanism transfers that liability.

Conclusion: Excise duty was not recoverable from the appellant; the contract manufacturer was liable, and the demand against the appellant was unsustainable.

Ratio Decidendi: In a bona fide job-work arrangement, central excise duty is payable by the person who actually manufactures the goods, and mere supply of raw materials or ownership of the goods does not make the principal manufacturer liable.

Issues: (i) Whether existing State money-lending laws remain enforceable against unlicensed private money lending pending the anticipated legislation of States and Union Territories; (ii) Whether civil or criminal proceedings and investigation concerning unlicensed money lending must await that legislation.

Issue (i): Whether existing State money-lending laws remain enforceable against unlicensed private money lending pending the anticipated legislation of States and Union Territories.

Analysis: State money-lending laws already impose a statutory bar on unlicensed lending against promissory notes, whether or not supported by cheques, title deeds, or other security. Such laws also incorporate the Dam Dupat restriction against interest exceeding the principal disbursed, disable enforcement of loans advanced by unlicensed lenders, and make unlicensed money lending punishable. Proceedings instituted by a private lender should be stopped at the threshold unless the lender produces a money-lending licence or establishes that the money was not advanced at interest.

Conclusion: Existing State money-lending laws remain operative and enforceable against unlicensed money lenders notwithstanding anticipated future legislation.

Issue (ii): Whether civil or criminal proceedings and investigation concerning unlicensed money lending must await that legislation.

Analysis: The expectation of fresh legislation does not suspend available corrective or appellate remedies in individual matters. It also does not defer commencement of investigation into offences under State money-lending laws or applicable criminal law.

Conclusion: Civil and criminal enforcement, including investigation of offences by unlicensed money lenders, need not await the anticipated legislation.

Final Conclusion: The clarification preserves the immediate operation of existing State money-lending safeguards and remedies pending any future legislative measures.

Ratio Decidendi: Existing statutory restrictions and enforcement mechanisms against unlicensed money lending cannot be kept in abeyance merely because further legislation is anticipated.

Issues: Whether rejection of approval under Section 80G(5) was sustainable without determining whether expenditure on religious activities exceeded five per cent of the trust's total income under Section 80G(5-B).

Analysis: Section 80G(5-B) deems an institution or fund that incurs religious expenditure not exceeding five per cent of its total income to be one to which the provision applies. The rejection proceeded on the trust having religious objects, but contained no reasons or analysis establishing that its expenditure towards religious activities exceeded the statutory threshold.

Conclusion: The direction for examination within the scope of Section 80G(5-B) warranted no interference, and no substantial question of law arose.

Issues: Whether the Revenue's challenge to approval under Section 80G(5B) could be entertained where the assessee had not been issued notice before rejection of its application.

Analysis: The finding that the Commissioner (Exemption) rejected the application without issuing any notice to the assessee was undisputed. The absence of notice rendered the rejection procedurally infirm and supported the Tribunal's view that the assessee was entitled to approval.

Conclusion: The proposed questions concerning eligibility for approval under Section 80G(5B) were not entertained; the rejection of the application without prior notice could not be sustained.

Issues: (i) Whether the manufacturing-segment margin requires reconsideration regarding idle-capacity and customs-duty adjustments, reversal of provisions, miscellaneous receipts, AE/non-AE segmentation and Elecon Engineering comparability; (ii) Whether business support service income and corresponding costs are operating items of the manufacturing segment; (iii) Whether Allsec Technologies Ltd. is excludable as a persistent loss-making comparable in the shared-services segment; (iv) Whether the marketing-support-services adjustment was made in breach of natural justice and could include parts sales; (v) Whether provision for obsolescence of inventory is deductible and whether corresponding stock valuation requires recomputation; (vi) Whether foreign-exchange gain is operating income in its entirety; (vii) Whether application-software licences qualify for depreciation at the higher rate; and (viii) Whether reimbursement of seconded employees' costs attracts disallowance as fees for technical services.

Issue (i): Whether the manufacturing-segment margin requires reconsideration regarding idle-capacity and customs-duty adjustments, reversal of provisions, miscellaneous receipts, AE/non-AE segmentation and Elecon Engineering comparability.

Analysis: Rule 10B(3) requires reasonably accurate adjustment for material differences affecting profits. Idle capacity is not confined to a start-up period and may arise from recession or industry conditions. The additional evidence concerning shutdown, demand conditions and capacity utilisation requires factual verification. The claimed customs-duty adjustment also requires examination. Reversal of a provision may be operating income only where it is established that the original provision was treated as an operating expense. Miscellaneous receipts require reconciliation before their operating character can be accepted. The AE/non-AE segmentation requires a rational allocation of foreign-exchange results and substantiation of cost allocation. Elecon Engineering's standalone business profile requires verification because a predominant business of manufacturing gears would make it functionally different from an earthmoving-equipment manufacturer.

Conclusion: These matters are remitted to the TPO for verification and fresh determination in accordance with the stated directions, with consequential relief to the assessee where the factual conditions are established.

Issue (ii): Whether business support service income and corresponding costs are operating items of the manufacturing segment.

Analysis: Business support services retain the character of service activity and do not become manufacturing activity merely because personnel or costs are recorded in the manufacturing segment. However, exclusion of service revenue requires exclusion of the corresponding expenditure on the principle of parity.

Conclusion: Business support service income is non-operating for the manufacturing segment, but the corresponding expenditure shall be excluded upon the assessee furnishing supporting details. The issue is partly in favour of the assessee.

Issue (iii): Whether Allsec Technologies Ltd. is excludable as a persistent loss-making comparable in the shared-services segment.

Analysis: The company earned profit in the financial year preceding the relevant year and was therefore not consistently loss-making. A company that does not incur persistent losses cannot be rejected solely under a persistent-loss filter.

Conclusion: Allsec Technologies Ltd. shall be included in the final set of comparables. The issue is in favour of the assessee.

Issue (iv): Whether the marketing-support-services adjustment was made in breach of natural justice and could include parts sales.

Analysis: The material, data and basis relied upon for the adjustment were not shared with the assessee, preventing an effective response. Further, the approach concerning commission attribution must remain consistent with the treatment of machine and engine sales and cannot extend to parts sales.

Conclusion: The adjustment is remitted for fresh decision after disclosure of the relied-upon material and adequate opportunity; any commission attribution shall exclude parts sales. The issue is partly in favour of the assessee.

Issue (v): Whether provision for obsolescence of inventory is deductible and whether corresponding stock valuation requires recomputation.

Analysis: A mere provision for old or obsolete stock does not establish an accrued loss; the loss is allowable when the stock is actually sold. Since such provisions were disallowed in the preceding and relevant assessment years, the opening and closing stock figures require consequential reworking.

Conclusion: The provision for obsolescence is not deductible, which is in favour of the Revenue; the Assessing Officer shall recompute opening and closing stock after accounting for the relevant disallowances.

Issue (vi): Whether foreign-exchange gain is operating income in its entirety.

Analysis: Foreign-exchange gain or loss arising from actual translation is an operating item for computing segmental margins. A notional or unrealised foreign-exchange gain does not have that character.

Conclusion: Only actual realised foreign-exchange gain shall be treated as operating income in the respective segments; unrealised gain shall not be treated as operating income. The issue is partly in favour of the Revenue.

Issue (vii): Whether application-software licences qualify for depreciation at the higher rate.

Analysis: Software licences that are in the nature of application software qualify for depreciation at the rate applicable to computer software, notwithstanding their accounting classification as intangible assets.

Conclusion: Higher depreciation is allowable where the software licence is application software. The issue is in favour of the assessee.

Issue (viii): Whether reimbursement of seconded employees' costs attracts disallowance as fees for technical services.

Analysis: The seconded personnel worked under the assessee's control and supervision, and tax was deducted from their remuneration. Reimbursement of their actual salaries to the associated enterprise contained no income element and could not be separately characterised as fees for technical services.

Conclusion: The reimbursement is not liable to disallowance under section 40(a)(i). The issue is in favour of the assessee.

Final Conclusion: The transfer-pricing computation and related segmental margins require fresh determination on the remitted factual matters, while the corporate-tax treatment is governed by the determinations on obsolete inventory, software depreciation and employee secondment reimbursement.

Issues: (i) Whether ad hoc disallowance of professional fees was sustainable; (ii) Whether trade-incentive and brand-promotion expenditure was capital expenditure; (iii) Whether receipts for shared premises and third-party lettings were taxable as income from other sources, whether notional rent could be assessed, and whether related expenditure was deductible.

Issue (i): Whether ad hoc disallowance of professional fees was sustainable.

Analysis: Similar disallowances in earlier assessment years had been deleted. No particular item of professional expenditure was identified as not having been incurred wholly and exclusively for business, and the disallowance was made on an ad hoc basis.

Conclusion: The ad hoc disallowance of professional fees was deleted, in favour of the assessee.

Issue (ii): Whether trade-incentive and brand-promotion expenditure was capital expenditure.

Analysis: Trade incentives formed part of the assessee's business model for promotion and sale of its products. Expenditure on sales promotion and brand promotion does not become capital merely because it may yield an enduring or incidental brand benefit.

Conclusion: The trade-incentive and brand-promotion expenditure was revenue expenditure and the disallowance was deleted, in favour of the assessee.

Issue (iii): Whether receipts for shared premises and third-party lettings were taxable as income from other sources, whether notional rent could be assessed, and whether related expenditure was deductible.

Analysis: The jurisdictional High Court's prior determination that receipts from the shared premises were assessable under the head income from other sources was binding. The same treatment applied to actual receipts from the small portion let to third parties. Notional rent cannot be assessed under that head without evidence that income was received or had accrued as receivable. Expenditure wholly and exclusively incurred for earning income from other sources is deductible under Section 57(ii) and Section 57(iii).

Conclusion: Actual premises receipts were assessable as income from other sources; notional rent was not taxable, and the related building and common expenditure was allowable, in favour of the assessee.

Final Conclusion: The substantive domestic-tax claims for both assessment years succeeded, while the transfer-pricing grounds were not adjudicated on merits because they were not pressed.

Ratio Decidendi: Where premises-related receipts are assessable as income from other sources, notional rent cannot be charged without proof of receipt or accrual, and expenditure wholly and exclusively incurred to earn that income is deductible.

Issues: (i) Whether refund claims filed after introduction of GST for service tax paid under the earlier regime in respect of cancelled insurance policies and services not provided were barred by limitation under Section 11B of the Central Excise Act, 1944 when made under Section 142(5) of the Central Goods and Services Tax Act, 2017; (ii) Whether such refund claims were hit by the principle of unjust enrichment where premium and tax had been received through financiers or agents and, on cancellation, the corresponding amounts were returned through the same channel.

Issue (i): Whether refund claims filed after introduction of GST for service tax paid under the earlier regime in respect of cancelled insurance policies and services not provided were barred by limitation under Section 11B of the Central Excise Act, 1944 when made under Section 142(5) of the Central Goods and Services Tax Act, 2017.

Analysis: Section 142(5) of the Central Goods and Services Tax Act, 2017 governs post-GST claims for refund of tax paid under the existing law in respect of services not provided, while Rule 6(3) of the Service Tax Rules, 1994 recognizes adjustment or credit where consideration for a service not provided is returned. The statutory scheme was read to mean that where no service was ultimately rendered because the insurance policy stood cancelled and the premium with tax component was returned, the claim is to be processed under the existing law only to the extent contemplated by Section 11B(2) of the Central Excise Act, 1944. The one-year limitation in Section 11B was not treated as a bar to such transitional refund claims concerning services not provided.

Conclusion: The refund claims were not barred by limitation; this issue was decided in favour of the assessee.

Issue (ii): Whether such refund claims were hit by the principle of unjust enrichment where premium and tax had been received through financiers or agents and, on cancellation, the corresponding amounts were returned through the same channel.

Analysis: Rule 6(3) of the Service Tax Rules, 1994 requires return of the amount to the person from whom it was received and does not mandate compliance with Section 64VB of the Insurance Act, 1938 as a separate condition for refund eligibility. The material on record showed that the premium had been received through financiers or agents, the cancellation amount along with the tax component had been remitted back to them, and the amount ultimately reached the insured by credit in the insured's account. In these circumstances, the incidence of tax had not been retained by the assessee and the bar of unjust enrichment was not attracted.

Conclusion: The refund claims were not hit by unjust enrichment; this issue was decided in favour of the assessee.

Final Conclusion: Transitional refund of service tax paid on cancelled insurance policies was legally admissible in cash where no service was ultimately provided and the tax burden had been passed back through the financing chain to the insured; the departmental challenge failed on both limitation and unjust enrichment, and the remand order was unsustainable.

Ratio Decidendi: A refund claim filed after the appointed day under Section 142(5) of the Central Goods and Services Tax Act, 2017 for tax paid under the earlier service tax regime on services not provided is not rejectable on limitation under Section 11B of the Central Excise Act, 1944, and is not barred by unjust enrichment where the consideration and tax component have been returned to the person from whom received so that the incidence of tax does not remain with the assessee.

Issues: Whether input tax credit of GST paid on long-term lease rental for land taken from the Government for construction of a factory is barred under Section 17(5)(d), including for the periods before and after construction, for vacant portions of the leased land, and for repairs, maintenance and renovation of the factory building.

Analysis: The restriction in Section 17(5)(d) is framed with a non obstante clause overriding Section 16 and blocks credit on goods or services received for construction of an immovable property on own account, including where such supplies are used in the course or furtherance of business. The expression "for construction" was construed by the Authority and affirmed here according to its ordinary purposive meaning, and the credit bar was held to apply to services received for the purpose of constructing the factory on leased land. The distinction between upfront premium and periodic lease rent was accepted, but it was held immaterial to eligibility because the tax treatment followed the statutory character of the lease service and the intended construction use of the land. The explanation to Section 17(5) extends "construction" to reconstruction, renovation, additions, alterations and repairs, so the same restriction applies to lease rental linked with repair and renovation activity. The vacant or green-belt portion of the land was also treated as part of the leased land devoted to the factory project, and the periodic timing of payment before or after construction was held not to change the statutory bar. Reliance on business-purpose credit under Section 16, on a restrictive reading of "for", and on differential treatment based on payment periodicity was rejected.

Conclusion: Input tax credit on GST paid on the lease rental was held to be inadmissible in all the situations raised, and the credit block under Section 17(5)(d) was applied against the appellant.

Final Conclusion: The impugned advance ruling was affirmed, and the appeal was rejected because the lease rental was treated as blocked credit under the statutory restriction governing construction of immovable property.

Ratio Decidendi: GST paid on a lease rental for land taken for constructing an immovable property is blocked by Section 17(5)(d) when the lease service is received for the purpose of such construction, and the timing of payment or the existence of vacant or repair-related use does not remove the statutory bar.

Issues: (i) whether the release of the amount withheld for non-achievement of milestones was liable to be upheld and whether the milestones ought to have been rescheduled; (ii) whether interest could be granted on the amount withheld for non-achievement of milestones; (iii) whether the award relating to the final bill and the claim for three percent difference between the post-GST and pre-GST period could stand; (iv) whether damages awarded for prolongation of the contract under Section 73 of the Indian Contract Act, 1872 and the allied reliefs could be sustained.

Issue (i): whether the release of the amount withheld for non-achievement of milestones was liable to be upheld and whether the milestones ought to have been rescheduled.

Analysis: The contract contemplated both extension of time and rescheduling of milestones. The contractor had in fact sought rescheduling, the request was forwarded, and clause 5.4 made clear that absence of a formal application was not a bar to rescheduling. Repeated extension of time without corresponding rescheduling of milestones rendered the withholding for milestone failure unsustainable on the petitioner's challenge.

Conclusion: The direction for release of the amount withheld for non-achievement of milestones was upheld.

Issue (ii): whether interest could be granted on the amount withheld for non-achievement of milestones.

Analysis: The award contained no reasoning on this head. Clause 2 of the contract provided for automatic withholding and expressly negatived payment of any interest on the withheld amount. In the absence of any contractual exception, the grant of interest conflicted with the bargain between the parties.

Conclusion: The award of interest on the withheld amount was set aside.

Issue (iii): whether the award relating to the final bill and the claim for three percent difference between the post-GST and pre-GST period could stand.

Analysis: The admitted clerical error in the amount relating to the final bill was capable of correction and the figure was reduced to the admitted due amount. On the GST-related claim, the contractual clauses provided reimbursement only for tax actually paid and for future levy properly proved. No evidence established payment of the claimed differential, and the reasoning treating part of the post-GST work as service tax was found untenable.

Conclusion: The final-bill amount was corrected to Rs. 54,44,112/-, and the award of the three percent GST-related difference was set aside.

Issue (iv): whether damages awarded for prolongation of the contract under Section 73 of the Indian Contract Act, 1872 and the allied reliefs could be sustained.

Analysis: Damages under Section 73 required proof of actual loss or damage, or a legally sustainable basis for reasonable assessment where proof was not possible. The only material was a chartered accountant's certificate, which did not establish actual loss suffered because of prolongation. The quantified award rested on assumptions and was therefore unsustainable. By contrast, the penalty refund concerning the sample flat was upheld because the absence of proved loss made the contractual penalty unenforceable on the facts found. The interest and costs, except to the extent specifically interfered with, were left undisturbed.

Conclusion: The damages for prolongation were set aside, while the refund of penalty for delay in the sample flat was upheld and the remaining interest and costs were sustained to the extent not interfered with.

Final Conclusion: The challenge succeeded only in part. The award was severed and interfered with only to the extent of interest on withheld milestone amounts, the GST-related differential claim, the damages for prolongation, and the clerical correction in the final-bill figure, while the remaining reliefs were left intact.

Ratio Decidendi: In proceedings under Section 34 of the Arbitration and Conciliation Act, 1996, a severable part of an arbitral award may be set aside, but damages under Section 73 of the Indian Contract Act, 1872 must rest on proof of actual loss or on a legally sustainable basis for estimation, and contractual terms expressly barring interest on withheld sums must be enforced.

Issues: Whether the petitioner's detention, arrest and remand were vitiated by illegal custody, non-compliance with mandatory procedural safeguards, and failure to produce him before the competent Magistrate within the prescribed time.

Analysis: The Court found that the petitioner was taken into custody on 29.01.2026, the arrest memo was prepared only on 30.01.2026, the place of arrest was not clearly mentioned, the grounds of arrest were not properly annexed or acknowledged, no transit remand was obtained, and the petitioner was produced before the remand Magistrate only on 31.01.2026. The Court held that these defects showed clear violation of the safeguards governing arrest and production of an arrestee, and that the remand order was passed without proper judicial application of mind.

Conclusion: The detention, arrest and remand were held illegal, the remand order was quashed, and the petitioner was directed to be released forthwith.

Final Conclusion: The custody was held to be unlawful for breach of mandatory arrest and remand safeguards, and the habeas corpus petition was allowed with liberty to proceed afresh in accordance with law.

Ratio Decidendi: Arrest and remand under fiscal statutes must strictly comply with mandatory procedural safeguards, including clear disclosure of the arrest particulars and timely production before the competent Magistrate; failure to do so renders the custody unlawful.

Issues: (i) Whether the detention, arrest, remand and custody of the petitioner were illegal for clubbing the allegation of undervaluation with the offence of clandestine removal under the GST law. (ii) Whether the arrest procedure, including supply of grounds of arrest, intimation to relatives or friends, place of arrest, and generation of DIN, complied with the mandatory safeguards.

Issue (i): Whether the detention, arrest, remand and custody of the petitioner were illegal for clubbing the allegation of undervaluation with the offence of clandestine removal under the GST law.

Analysis: The Court found that the respondents did not adequately explain why undervaluation, which was linked to Section 122(1)(i) of the Central Goods and Services Tax Act, 2017 and required determination under Section 74 of that Act, was treated as part of the offence under Section 132(1)(a). The first remand application had separated the two heads of evasion, while the second remand application mixed them together. The Court held that the two allegations were not shown to be legally interchangeable and that the remand order was passed mechanically without proper consideration of the defence objections.

Conclusion: The clubbing of undervaluation with clandestine removal was not justified, and the arrest, remand and custody were held illegal.

Issue (ii): Whether the arrest procedure, including supply of grounds of arrest, intimation to relatives or friends, place of arrest, and generation of DIN, complied with the mandatory safeguards.

Analysis: The Court found violations in the manner of arrest, including non-compliance with the requirement of supplying grounds of arrest in the manner prescribed, failure to properly intimate a relative or friend, absence of the place of arrest in the arrest memo, and non-compliance with the circular and instructions relating to DIN generation. The Court also noted that the safeguards recognised in the governing law and binding precedent were not followed.

Conclusion: The arrest procedure was held to be non-compliant with mandatory legal safeguards.

Final Conclusion: The remand order and all consequential proceedings were quashed, and the petition succeeded, while leaving it open to the respondents to proceed afresh in accordance with law.

Ratio Decidendi: Where allegations under distinct GST provisions are unlawfully clubbed and mandatory arrest safeguards are not complied with, the resulting arrest and remand are liable to be quashed as illegal.

Outcome: The writ petition was disposed of with liberty to prefer an appeal before the GST Appellate Tribunal within the stipulated period, with the appeal to be entertained without objection on limitation if filed within time, and with consequential directions regarding pre-deposit compliance and removal of defects.

Outcome: The writ petition was disposed of by permitting the petitioner to avail the statutory appeal before the GST Appellate Tribunal, with directions regarding limitation, pre-deposit compliance, removal of defects, and disposal of the appeal on merits in accordance with law.

Issues: (i) Whether, after constitution of the GST Appellate Tribunal and issuance of the procedure governing its functioning, the writ petition should be disposed of in view of the availability of the appellate remedy; (ii) Whether any appeal filed before the Tribunal within the notified period could be entertained without objection as to limitation and whether the amount earlier deposited would satisfy the statutory pre-deposit requirement.

Issue (i): Whether, after constitution of the GST Appellate Tribunal and issuance of the procedure governing its functioning, the writ petition should be disposed of in view of the availability of the appellate remedy.

Analysis: The Tribunal had been constituted, members had been appointed to the benches, and the procedure for regulating its functioning had been notified. In these circumstances, the writ court found that no useful purpose would be served by retaining the petition, particularly when the statutory appellate forum under the GST regime was operational and the petition could be carried before that forum. The Court expressly declined to enter into the validity or legality of the impugned orders.

Conclusion: The writ petition was disposed of, leaving the petitioner to pursue the statutory appeal before the GST Appellate Tribunal.

Issue (ii): Whether any appeal filed before the Tribunal within the notified period could be entertained without objection as to limitation and whether the amount earlier deposited would satisfy the statutory pre-deposit requirement.

Analysis: The Court accepted the notified outer date for filing appeals before the Tribunal and directed that an appeal filed within that period should be entertained without raising limitation objections. It also directed that the amount already deposited in the writ proceedings, if produced with the relevant proof, would be treated as compliance with the statutory pre-deposit requirement under the GST law. The Tribunal was further directed to intimate defects, if any, and permit removal within the stipulated time.

Conclusion: The petitioner was permitted to file an appeal up to 30 June 2026 without limitation objection, and the prior deposit was to be treated as compliance with the pre-deposit condition, subject to verification.

Final Conclusion: The matter was sent to the statutory appellate forum with protective directions preserving the petitioner's right to appeal and ensuring that limitation and pre-deposit requirements would not defeat the remedy.

Ratio Decidendi: Once the GST Appellate Tribunal is constituted and made functional, the writ court may dispose of the petition in favour of the statutory appellate remedy while protecting the appellant from limitation and pre-deposit consequences to the extent directed by the Court.

Issues: (i) Whether depreciation on passive infrastructure assets transferred under a court-approved demerger could be disallowed by treating the transfer as not being a gift; (ii) whether network site rentals paid to Indus Towers required fresh factual verification; (iii) whether disallowance under section 14A could survive in the absence of exempt income and whether the same could be added back under section 115JB; (iv) whether roaming charges attracted tax deduction at source and consequent disallowance; (v) whether depreciation on 3G spectrum fees was allowable as an intangible asset or had to be amortised under section 35ABB; (vi) whether deduction under section 80IA was allowable on scrap sales, cell site sharing income, IRU revenue, late payment charges, cheque bounce charges, provisions written back, other income and SFIS income; (vii) whether the transfer pricing adjustment on ECB interest and upfront fee was sustainable; (viii) whether the license fee payable to DoT had to be dealt with under section 35ABB; (ix) whether royalty paid to WPC and brand royalty paid to associated enterprises called for interference; and (x) whether initiation of penalty proceedings under section 271(1)(c) could be adjudicated.

Issue (i): Whether depreciation on passive infrastructure assets transferred under a court-approved demerger could be disallowed by treating the transfer as not being a gift.

Analysis: The transfer of passive infrastructure assets had been effected without consideration under a scheme of demerger sanctioned by the High Court. The same controversy had already been decided in the assessee's own case for an earlier year, where the transfer was treated as a genuine gift falling within section 47(iii), and the Revenue had failed to show any contrary factual matrix or higher court ruling.

Conclusion: The disallowance of depreciation was unsustainable and was deleted in favour of the assessee.

Issue (ii): Whether network site rentals paid to Indus Towers required fresh factual verification.

Analysis: The allowability of the payment turned on the commercial restructuring, the cost structure of tower operations and the nature of the services rendered after the transfer of passive infrastructure. Those aspects had not been fully examined by the lower authorities, and the earlier year's decision had restored the matter for de novo examination.

Conclusion: The issue was remanded to the Assessing Officer for fresh adjudication and was allowed for statistical purposes.

Issue (iii): Whether disallowance under section 14A could survive in the absence of exempt income and whether the same could be added back under section 115JB.

Analysis: The assessee had not earned any exempt income during the year. The issue was covered by binding precedent holding that section 14A disallowance is not attracted when no exempt income arises. Once that disallowance failed, there was no basis to add the same to book profit under section 115JB, and in any case such adjustment was not permissible mechanically under the MAT computation.

Conclusion: Both the section 14A disallowance and the corresponding section 115JB adjustment were deleted in favour of the assessee.

Issue (iv): Whether roaming charges attracted tax deduction at source and consequent disallowance.

Analysis: Roaming services between telecom operators were held in earlier years to be rendered through an automated and standardised process without human intervention. On that basis, the payments were not treated as fees for technical services and the provisions invoked for disallowance on non-deduction of tax did not apply.

Conclusion: The disallowance under sections 40(a)(ia) and 40(a)(i) was deleted in favour of the assessee.

Issue (v): Whether depreciation on 3G spectrum fees was allowable as an intangible asset or had to be amortised under section 35ABB.

Analysis: Consistent Tribunal decisions in related cases had held that the right to use spectrum is a business or commercial right of similar nature eligible for depreciation as an intangible asset. The amortisation provision for telecommunication licences under section 35ABB was held not to govern such a claim.

Conclusion: Depreciation on 3G spectrum fees was allowed in favour of the assessee.

Issue (vi): Whether deduction under section 80IA was allowable on scrap sales, cell site sharing income, IRU revenue, late payment charges, cheque bounce charges, provisions written back, other income and SFIS income.

Analysis: For telecommunication undertakings, section 80IA(2A) operates as a special provision and the restrictive construction of the expression "derived from" was not applied in the same narrow manner. Scrap sales, cell site sharing receipts, IRU income, late payment charges, cheque bounce charges, provisions written back, other income and SFIS income were treated as having a proximate and business-linked nexus with the eligible undertaking.

Conclusion: Deduction under section 80IA was allowed on these receipts in favour of the assessee, while the related objection concerning disallowance under section 14A became academic.

Issue (vii): Whether the transfer pricing adjustment on ECB interest and upfront fee was sustainable.

Analysis: The RBI-approved all-in-cost for the ECB was treated as a highly relevant benchmark. The TPO's comparable set suffered from material infirmities relating to the nature of the loan, security profile, purpose, tenor, risk adjustments and subordination. The upfront fee formed part of the borrowing cost and had to be considered with interest for an effective all-in-cost analysis.

Conclusion: The transfer pricing adjustment was deleted in favour of the assessee.

Issue (viii): Whether the license fee payable to DoT had to be dealt with under section 35ABB.

Analysis: In view of the Supreme Court ruling on telecom licence fees, the annual license fee was held to be capital in nature and liable to amortisation under section 35ABB rather than being allowed as revenue expenditure under section 37(1).

Conclusion: The matter was restored to the Assessing Officer to compute the disallowance in accordance with section 35ABB, resulting in a partial success for the Revenue.

Issue (ix): Whether royalty paid to WPC and brand royalty paid to associated enterprises called for interference.

Analysis: The WPC payment was held to be recurring operational expenditure incurred for use of spectrum and not capital in nature. As to brand royalty, the ALP could not be fixed at nil without a proper comparability analysis and the TPO could not reject the assessee's benchmarking merely on conjectural grounds.

Conclusion: The deletion of the WPC disallowance and the deletion of the brand royalty transfer pricing adjustment were upheld in favour of the assessee.

Issue (x): Whether initiation of penalty proceedings under section 271(1)(c) could be adjudicated.

Analysis: The penalty ground was premature and did not give rise to a justiciable controversy at that stage.

Conclusion: The ground was dismissed.

Final Conclusion: The assessee succeeded on the principal substantive additions and transfer pricing disputes, while the Revenue obtained limited relief only on the treatment of telecom licence fee under section 35ABB and the connected remand. The appeals were therefore disposed of with mixed results, largely in favour of the assessee on merits.

Issues: Whether the assessment and appellate order required interference and the matter should be restored for fresh adjudication after granting the assessee one more opportunity to produce evidence regarding the source of investment, repayment of mortgage loan, and residential status.

Analysis: The appeal arose from an addition made under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 in relation to proceeds from sale of a foreign house property. The assessee claimed that the property was purchased while non-resident, the sale proceeds were disclosed in the USA, and the transaction resulted in no taxable gain in India, while also disputing the year of assessment and the procedural validity of the proceedings. The record showed that the assessee had not produced conclusive evidence before the lower authorities on material aspects such as residential status at the relevant times, source of funds for acquisition, and repayment of mortgage loan. At the same time, the matter was old and the assessee sought an additional opportunity to place supporting documents, and the Tribunal considered it appropriate in the interests of justice to remit the matter.

Conclusion: The matter was restored to the file of the CIT(A) for de novo adjudication after giving the assessee proper opportunity to furnish evidence and explanations; the merits of the additions and legal objections were kept open.

Ratio Decidendi: Where material evidence relevant to source of investment, repayment of foreign mortgage loan, and residential status is not conclusively on record, but the assessee seeks a further opportunity, the appellate matter may be remanded for fresh decision in accordance with law after affording proper hearing.

Issues: Whether the Appellate Authority was required to interfere with the Advance Ruling on eligibility of the applicant's compostable plastic bags for the concessional rate under Serial No. 319 of Notification No. 09/2025-Central Tax (Rate) dated 17.09.2025, and whether the authority under GST could itself conclusively determine biodegradability or compostability.

Analysis: The bags were held to fall under Chapter 39 as plastic articles, irrespective of their biodegradable character. The concessional entry applied only to biodegradable bags, but the determination of biodegradability and compostability was treated as a scientific and technical to be examined by the competent environmental authorities and not within the scope of advance ruling under Section 97(2) of the Central Goods and Services Tax Act, 2017. The records and certificates produced by the appellant were found insufficient for the Appellate Authority to substitute its own technical assessment, and it was observed that jurisdictional GST field formation may draw samples and obtain testing for that purpose.

Conclusion: The Advance Ruling was upheld and the appeal was rejected.

Ratio Decidendi: A GST advance ruling forum cannot itself conclusively determine biodegradability or compostability, which remains a technical question for the competent environmental authorities, and concessional entry eligibility linked to that condition cannot be granted on the basis of such technical determination alone.

Issues: Whether penalty under Section 125 could be imposed separately under CGST and SGST so as to exceed the statutory maximum, and whether the consequential appellate order could stand.

Analysis: The penalty imposed was Rs. 25,000 under CGST and Rs. 25,000 under SGST, aggregating Rs. 50,000. On a reading of Section 125, the statutory cap was treated as controlling the levy, and the bifurcation of penalty into two separate amounts was held to be unjustified. Since the main penalty order was unsustainable, the appellate order dismissing the appeal as time-barred could not survive.

Conclusion: The penalty order and the appellate order were set aside, and the matter was remanded for fresh adjudication in accordance with law.

Final Conclusion: The petitioner succeeded on the legality of the penalty levy, but the matter was sent back for reconsideration by the authority concerned.

Ratio Decidendi: Where a statute prescribes a maximum penalty, the authority cannot split the levy across CGST and SGST so as to exceed that ceiling.

Issues: (i) Whether the period from 15.03.2020 to 28.02.2022 stood excluded while computing the 180-day period for retention, freezing and provisional attachment proceedings under the Prevention of Money Laundering Act, 2002; (ii) whether the interim stay in the connected criminal proceedings affected the present PMLA proceedings and whether the challenge based on reclassification of bank accounts and absence of foundational facts was sustainable; (iii) whether the challenge to the attachment, seizure and freezing orders on the ground of absence of reasons to believe and non-discharge of burden under Section 24 was sustainable; and (iv) whether the Tribunal should accept the contention that Section 8(3) did not authorise the impugned action and that the Delhi High Court decision in Rajesh Kumar Agarwal governed the matter.

Issue (i): Whether the period from 15.03.2020 to 28.02.2022 stood excluded while computing the 180-day period for retention, freezing and provisional attachment proceedings under the Prevention of Money Laundering Act, 2002.

Analysis: The Tribunal treated the Supreme Court's pandemic-related orders as applicable to judicial and quasi-judicial proceedings, including proceedings under the PMLA where the Adjudicating Authority must conclude matters within a prescribed time. It held that the 180-day period under the PMLA is an endpoint for termination of proceedings and therefore falls within the exclusion granted for the Covid period. On that basis, the impugned orders were found to have been passed within time after exclusion of the relevant period.

Conclusion: The challenge on limitation failed and was rejected against the appellants.

Issue (ii): Whether the interim stay in the connected criminal proceedings affected the present PMLA proceedings and whether the challenge based on reclassification of bank accounts and absence of foundational facts was sustainable.

Analysis: The Tribunal held that the stay order of the Supreme Court was confined to the criminal proceedings pending before the trial court and did not extend to the present proceedings concerning provisional attachment, seizure or freezing. It further held that reclassification of the accounts from fraud or willful defaulter status did not erase the allegations of diversion of funds, use of funds for non-business purposes, and the existence of a predicate offence. The record, including the FIR, ECIR and statements under Section 50(2), was treated as sufficient to show foundational facts supporting the money-laundering proceedings.

Conclusion: The challenge based on the stay order, reclassification of accounts and absence of foundational facts failed.

Issue (iii): Whether the challenge to the attachment, seizure and freezing orders on the ground of absence of reasons to believe and non-discharge of burden under Section 24 was sustainable.

Analysis: The Tribunal held that the Adjudicating Authority had recorded reasons to believe at the initial stage and that the subsequent adjudication order contained sufficient conclusions after considering the rival material. On the attached jewellery and immovable properties, it held that the appellants failed to produce cogent documentary proof establishing a lawful source independent of proceeds of crime. The Tribunal applied the reverse burden under Section 24 and concluded that the appellants had not discharged it.

Conclusion: The challenge to the recording of reasons and the challenge to attachment of properties and jewellery was rejected.

Issue (iv): Whether Section 8(3) did not authorise the impugned action and whether the Delhi High Court decision in Rajesh Kumar Agarwal governed the matter.

Analysis: The Tribunal examined Sections 8, 17 and 20 of the PMLA and held that the adjudicatory power under Section 8(3) includes confirmation of attachment as well as retention of seized or frozen property after the statutory procedure. It accepted the respondent's submission that the interpretation adopted in Rajesh Kumar Agarwal conflicted with the Supreme Court's exposition in Vijay Madanlal Choudhary on the role of the Adjudicating Authority under Section 17(4). The Tribunal also held that the High Court decision could not be followed to the extent it rewrote the statutory scheme or displaced the Supreme Court's binding interpretation.

Conclusion: The objection based on Section 8(3) and Rajesh Kumar Agarwal was rejected; the impugned orders were upheld.

Final Conclusion: The appeals failed on all substantial grounds, and the orders confirming provisional attachment, retention, freezing and seizure were sustained.

Ratio Decidendi: Pandemic-related exclusion orders of the Supreme Court apply to statutory time limits for concluding quasi-judicial PMLA proceedings, and the Adjudicating Authority's power under Section 8(3) extends to lawful confirmation of attachment and retention of seized or frozen property following the prescribed process.

Issues: Whether the addition made towards cash deposits in bank account as unexplained cash sales or unexplained cash credits under section 68 of the Income-tax Act, 1961 was sustainable.

Analysis: The assessee produced details of turnover, gross profit and net profit for preceding years, and explained that the business involved wholesale supply of medicines with realisation from customers through cash, cheque and digital modes. The record showed that the cash deposits were linked to business receipts, and the appellate authority had verified the materials and accepted the explanation that a substantial part of the cash receipts had been deposited in the bank account. In the absence of any material to dislodge those verified findings, no interference was called for.

Conclusion: The addition under section 68 was not sustainable and the deletion made by the appellate authority was upheld in favour of the assessee.

Ratio Decidendi: Where cash deposits are duly explained as business receipts supported by turnover and profit details, and the explanation is verified on record, an addition for unexplained cash credits cannot be sustained under section 68.