Issues: Whether the aggregate disallowance of the claimed house-property loss and deductions under Sections 80C and 80D could be sustained on the evidence produced.

Analysis: The claims for house-property loss and Chapter VI-A deductions required evidentiary substantiation. The material produced was partly self-serving and contained inconsistencies, making it unsuitable for accepting the claims in full. Given the limited quantum involved, an ad hoc estimation of income at 10 per cent of the aggregate disallowance was considered appropriate.

Conclusion: The aggregate additions were restricted to Rs. 36,344, being 10 per cent of Rs. 3,63,437, taxable at normal rates rather than under Section 115BBE.

Issues: Whether the addition arising from the alleged cash transactions should be confined to an estimated 8% profit element rather than the entire amount.

Analysis: In the assessee's prior assessment years, the departmental authorities had accepted estimation of income at 8% in respect of similar cash transactions. Applying that consistent treatment to the year in question, the addition was directed to be computed only at 8% of the alleged transaction amount of Rs. 2,87,345.

Conclusion: The addition is restricted to Rs. 22,987, being 8% of Rs. 2,87,345; the balance of the addition cannot stand.

Issues: Whether reassessment could be sustained where no addition was made in respect of the income forming the recorded reason for reopening, but additions were made on other matters.

Analysis: Section 147, read with Explanation 3, permits assessment of other income noticed in a validly reopened proceeding, but does not remove the requirement that the income forming the recorded reason for reopening be assessed or reassessed. The long-term capital gains identified in the recorded reasons were not added; the disallowance under Section 54F and the addition under income from other sources were distinct matters. The binding jurisdictional rule therefore precluded sustaining the reassessment solely on those other additions.

Conclusion: The reassessment under Section 143(3) read with Section 147 was unsustainable and was quashed; the consequential additions, including the disallowance under Section 54F, could not survive.

Issues: (i) Whether reopening of the assessment was valid under Section 147 of the Income-tax Act, 1961; (ii) Whether an addition based on third-party statements without affording cross-examination was sustainable; (iii) Whether the loan-credit addition was sustainable on the evidence of genuineness and repayment.

Issue (i): Whether reopening of the assessment was valid under Section 147 of the Income-tax Act, 1961.

Analysis: Reassessment jurisdiction requires an independent reason to believe, founded on relevant material, that income chargeable to tax has escaped assessment. The recorded reasons neither identified a failure to disclose material facts nor demonstrated independent verification of the existing assessment records. They proceeded on factually incorrect material and borrowed satisfaction, without tangible material establishing escapement of income.

Conclusion: The reopening was invalid and is quashed, in favour of the assessee.

Issue (ii): Whether an addition based on third-party statements without affording cross-examination was sustainable.

Analysis: Where an addition rests on third-party statements or material, principles of natural justice require disclosure of such material and an effective opportunity to rebut it, including cross-examination of the persons whose statements are relied upon. The absence of that opportunity left the material untested.

Conclusion: The addition founded on third-party statements without cross-examination was unsustainable, in favour of the assessee.

Issue (iii): Whether the loan-credit addition was sustainable on the evidence of genuineness and repayment.

Analysis: The loan transactions were recorded in the books and supported by ledger accounts, PAN particulars, bank statements, confirmations, and repayment details. Subsequent repayment of the loans supported the genuineness of the credits and did not justify their treatment as unexplained cash credits.

Conclusion: The loan-credit addition was deleted, in favour of the assessee.

Final Conclusion: The invalid reopening and the independent defects in the loan-credit addition render the reassessment demand unsustainable.

Ratio Decidendi: Reassessment jurisdiction cannot be invoked on borrowed satisfaction or factually incorrect reasons lacking independently verified tangible material establishing escapement of income.

Issues: Whether an addition for unexplained money could be sustained solely on an unsigned excel sheet recovered from a third party, without cross-examination of the relevant persons or independent corroborative evidence.

Analysis: The material relied upon consisted of an unsigned third-party excel sheet that did not identify or bear the signature of the assessee. An adverse addition founded on such material required an opportunity to cross-examine the persons connected with it and independent evidence establishing that the alleged cash payment had actually been made. In the absence of cross-examination and corroboration, the excel sheet remained an unreliable third-party document incapable of supporting the addition.

Conclusion: The addition under Section 69A read with Section 115BBE of the Income-tax Act, 1961, was unsustainable and was deleted.

Issues: Whether cash receipts recorded in the regular books as collections from identified business debtors could be treated as unexplained money under Section 69A of the Income-tax Act, 1961.

Analysis: Section 69A applies where money is established to be unexplained. The disputed receipts were recorded in the regular books and were supported by party-wise ledgers, identified debtor particulars, audited accounts, sales and purchase registers, stock records and VAT returns. No defect was identified in the underlying business records, the books were not rejected, and no independent verification was undertaken from the identified parties. The absence of debtor confirmations alone could not displace the documentary evidence or establish unexplained money. Acceptance of Specified Bank Notes during demonetisation, without contrary material connecting the receipts to undisclosed income, also did not establish an unexplained source. Suspicion could not substitute proof.

Conclusion: The receipts were not established to be unexplained money under Section 69A of the Income-tax Act, 1961, and the addition was deleted in favour of the assessee.

Issues: (i) Whether the addition for unexplained investment in intangible assets and the consequential depreciation disallowance required verification; (ii) Whether the assessed-income computation, based on adjustments in the intimation under section 143(1), involved duplication of disallowances.

Issue (i): Whether the addition for unexplained investment in intangible assets and the consequential depreciation disallowance required verification.

Analysis: Section 69 of the Income-tax Act, 1961 applies to investments whose nature and source remain unexplained, while section 115BBE governs their taxation. The difference between the recorded cost of intangible assets and the supporting documents produced could not be determined without examining the books of account, invoices, agreements, ledgers, payment records, salary records, and evidence concerning software customisation and development. The depreciation disallowance was consequential to the addition.

Conclusion: The addition for unexplained investment and the consequential depreciation disallowance are remitted for fresh verification and adjudication.

Issue (ii): Whether the assessed-income computation, based on adjustments in the intimation under section 143(1), involved duplication of disallowances.

Analysis: Verification was required by comparing the original and revised returns, the intimation under section 143(1), the computation of income, tax audit report, and assessment order to ascertain whether the disputed expenses had already been disallowed and whether the assessment duplicated those disallowances.

Conclusion: The computation issue is remitted for verification and fresh adjudication.

Final Conclusion: The disputed additions and computation adjustments must be reconsidered on verification of the relevant records after providing a reasonable opportunity to furnish supporting evidence and explanations.

Issues: (i) Whether the relevant date of import for applying an import-policy restriction under the Foreign Trade Policy is the date of shipment or dispatch or the date of filing of the Bill of Entry or clearance for home consumption; (ii) Whether Notification No. 02/2026-27 applies to goods dispatched and arrived in India before its electronic Gazette publication merely because the Bills of Entry were filed thereafter.

Issue (i): Whether the relevant date of import for applying an import-policy restriction under the Foreign Trade Policy is the date of shipment or dispatch or the date of filing of the Bill of Entry or clearance for home consumption.

Analysis: Paragraph 1.05(b) of the Foreign Trade Policy, read with paragraphs 2.17(a) and 11.11 of the Handbook of Procedures, 2023, defines the date of import by reference to shipment or dispatch from the supplying country. For air imports, the relevant Airway Bill evidencing departure from the last airport in the exporting country is determinative. The Bill of Entry or out-of-charge date is relevant under Section 15 of the Customs Act, 1962 for determining the rate of customs duty, but does not govern the applicability of an import-policy restriction under the Foreign Trade Policy.

Conclusion: The relevant date of import for the import-policy restriction is the shipment or dispatch date determined under the Foreign Trade Policy and Handbook of Procedures, not the post-notification Bill of Entry or clearance date. This issue is decided in favour of the assessee.

Issue (ii): Whether Notification No. 02/2026-27 applies to goods dispatched and arrived in India before its electronic Gazette publication merely because the Bills of Entry were filed thereafter.

Analysis: A notification acquires legal force only upon its electronic Gazette publication and cannot operate retrospectively without statutory authority. The restrictive notification could therefore operate only prospectively and could not affect goods already dispatched and arrived before publication. Its clauses excluding transitional arrangements did not alter this position. A subsequent executive memorandum lacked statutory force and could neither override the policy-defined date of import nor retrospectively expand the notification's application; conditional import authorisations did not redress that entitlement.

Conclusion: No. The restrictive notification is inapplicable to goods dispatched and arrived before its electronic Gazette publication, notwithstanding subsequent filing of Bills of Entry. This issue is decided in favour of the assessee.

Final Conclusion: Goods whose shipment or dispatch predates the effective publication of a restrictive import-policy amendment remain governed by the pre-existing import policy, and that position cannot be altered through a subsequent executive clarification.

Ratio Decidendi: For import restrictions under the Foreign Trade Policy, the policy-defined shipment or dispatch date governs the date of import; the customs clearance date applicable to duty assessment and an executive clarification cannot retrospectively vary that policy framework.

Issues: Whether cognizance for an alleged contravention of Section 217(4) of the Companies Act, 2013 was liable to be quashed.

Analysis: At the cognizance stage, scrutiny is confined to the complaint and supporting material for determining whether a prima facie case exists; defence material and explanations cannot be evaluated through a mini-trial. The complaint and supporting documents disclosed allegations of non-cooperation with the investigation, and the cognizance order reflected application of mind to that material.

Conclusion: The cognizance and issuance of process for the alleged offence under Section 217(4), punishable under Section 217(6), of the Companies Act, 2013 were not liable to be quashed.

Issues: Whether an adjudicating authority may confirm a tax demand exceeding the demand proposed in the show-cause notice, contrary to Section 75(7) of the Uttar Pradesh Goods and Services Tax Act, 2017.

Analysis: Section 75(7) prohibits confirmation of a demand exceeding that proposed in the show-cause notice. The notice proposed a substantially lower tax demand, interest and penalty than those confirmed in the adjudication order. Breach of this mandatory restriction rendered the excess confirmation jurisdictionally invalid.

Conclusion: An adjudicating authority cannot confirm a demand beyond that proposed in the show-cause notice; the impugned excess demand was invalid, in favour of the assessee.

Issues: Whether service of GST notices solely through portal uploads, despite repeated non-response and without recourse to other statutory modes of service, rendered the ex parte assessment and appellate rejection violative of principles of natural justice.

Analysis: Uploading notices on the GST portal is a valid mode of service. However, where repeated notices elicit no response, the proper officer must apply their mind and explore other modes available under Section 169(1) of the Central Goods and Services Tax Act, 2017, preferably registered post with acknowledgement due. Mere portal uploads in such circumstances amount to an empty formality rather than effective service, particularly where no meaningful opportunity of hearing is afforded.

Conclusion: In favour of the assessee, the ex parte assessment and appellate rejection were vitiated by breach of the principles of natural justice.

Issues: Whether general insurance services availed by a manufacturer after 1 April 2011 qualify as input services eligible for CENVAT credit under Rule 2(l) of the CENVAT Credit Rules, 2004.

Analysis: The post-amendment definition in Rule 2(l) deleted the expression "activities relating to business" to align the scope of input services with inputs. The specified exclusions concern, inter alia, construction-related services, motor-vehicle-related services and services primarily meant for employees' personal use or consumption. General insurance used in relation to the manufacturing activity was not covered by those exclusions and retained a direct or indirect nexus with manufacture of final products. The departmental clarification on sales commission did not restrict credit for services otherwise satisfying the principal limb of the definition.

Conclusion: General insurance service used in relation to manufacture remains an input service eligible for CENVAT credit after 1 April 2011; no substantial question of law arose.

Issues: (i) Whether the First Appellate Authority could condone delay in filing an appeal beyond the maximum period under Section 107(4) of the Central Goods and Services Tax Act, 2017; and (ii) Whether the Department's challenge remained maintainable after it implemented the order by restoring registration.

Issue (i): Whether the First Appellate Authority could condone delay in filing an appeal beyond the maximum period under Section 107(4) of the Central Goods and Services Tax Act, 2017.

Analysis: Section 107(1) prescribes the ordinary limitation period and Section 107(4) permits condonation only within its fixed additional period. The First Appellate Authority, being a statutory authority, has no inherent power to extend that outer limit. Directions issued by a High Court in exercise of writ jurisdiction under Article 226 of the Constitution of India, on their particular facts, do not enlarge the statutory appellate jurisdiction. Equity follows the law and cannot override an express limitation provision.

Conclusion: The First Appellate Authority could not condone delay beyond the statutory maximum; this issue is decided against the assessee.

Issue (ii): Whether the Department's challenge remained maintainable after it implemented the order by restoring registration.

Analysis: The Department restored the registration pursuant to the impugned order, and the assessee thereafter continued business and filed returns on that basis. Having implemented the restoration and altered the assessee's legal and commercial position, the Department was estopped from seeking to invalidate that relief, since no effective appellate relief could then be granted.

Conclusion: The Department's challenge was not maintainable after restoration of registration; this issue is decided in favour of the assessee.

Final Conclusion: Although the condonation exceeded the First Appellate Authority's statutory power, the restoration already implemented by the Department could not be undone through the present challenge.

Ratio Decidendi: A statutory appellate authority cannot extend a legislatively fixed outer limitation period, and a department that has acted upon an order restoring registration cannot subsequently seek its ineffective reversal.

Issues: Whether an individual investor's compensation claim against a statutory auditor for a fraudulent prospectus under Section 35 of the Companies Act, 2013, could be adjudicated in a civil suit after insolvency proceedings and proceedings under Section 66 of the Insolvency and Bankruptcy Code, 2016 had been initiated against the company.

Analysis: Section 35 ordinarily confers upon an investor who subscribed to securities on the basis of a fraudulent prospectus a personal right to seek compensation from persons liable for the resulting loss. However, where the company is in insolvency and the alleged fraudulent conduct is subject to Section 66 proceedings, recoveries for such conduct form part of the collective insolvency process and are available for the benefit of the creditors. In those circumstances, the otherwise personal claim assumes the character of an action in rem and cannot be pursued for the exclusive benefit of a single creditor through a separate civil suit.

Conclusion: The claim against the statutory auditor could not be adjudicated in the civil suit; the available recourse lay under Section 66 of the Insolvency and Bankruptcy Code, 2016 for the collective benefit of creditors.

Issues: Whether regular bail should be granted where the accused had undergone substantial pre-trial incarceration, cognizance had not been taken, and the trial was likely to take considerable time.

Analysis: The relevant bail inquiry was whether continued custody remained necessary pending trial. The appellant had remained incarcerated for about one year and three months; cognizance had not been taken and the trial was at a nascent stage. The anticipated duration of trial, coupled with bail granted to arrested co-accused and the non-arrest of several others, did not justify continued incarceration.

Conclusion: Continued incarceration was unwarranted, and regular bail was granted on terms to be fixed by the Trial Court.

Issues: (i) Whether the First Appellate Authority could condone a delayed appeal beyond the outer limit under Section 107(4) of the Central Goods and Services Tax Act, 2017; (ii) Whether the Department's appeal remained maintainable after it implemented the order restoring registration.

Issue (i): Whether the First Appellate Authority could condone a delayed appeal beyond the outer limit under Section 107(4) of the Central Goods and Services Tax Act, 2017.

Analysis: Section 107(1) prescribes a three-month period for filing an appeal, while Section 107(4) permits condonation only for a further one month upon sufficient cause. The First Appellate Authority, being a statutory authority, has no inherent or plenary power to extend the outer limitation period. Directions issued by the High Court under Article 226 of the Constitution of India on the facts of particular writ proceedings do not enlarge the Authority's jurisdiction. Equity or hardship cannot override an express statutory limitation.

Conclusion: The First Appellate Authority lacked jurisdiction to condone delay beyond the maximum period under Section 107(4) of the Central Goods and Services Tax Act, 2017. This issue is decided against the assessee.

Issue (ii): Whether the Department's appeal remained maintainable after it implemented the order restoring registration.

Analysis: The Department had acted upon the impugned order, restored the registration, and enabled continuation of business and return filing. Reversal after such implementation would unsettle the assessee's intervening commercial transactions and legal position. Estoppel and orderly administration precluded the Department from seeking ineffective relief against an order it had already implemented.

Conclusion: The Department could not maintain its challenge after implementing the restoration of registration, as no effective relief could be granted. This issue is decided in favour of the assessee.

Final Conclusion: Although the condonation of delay exceeded the First Appellate Authority's statutory jurisdiction, the restoration of registration remains unaffected because the Department's own implementation precludes effective appellate relief.

Ratio Decidendi: A statutory appellate authority cannot condone delay beyond the express outer limit fixed by law; however, where the Department has implemented the impugned restoration of registration, it cannot subsequently obtain relief that would unsettle that implemented position.

Issues: (i) Whether additions for unexplained capital introduction and unreconciled bank credits could be sustained without verification of the assessee's claimed sources and bank entries; (ii) Whether GST late fee for delayed payment is disallowable as expenditure incurred for a purpose that is an offence or prohibited by law.

Issue (i): Whether additions for unexplained capital introduction and unreconciled bank credits could be sustained without verification of the assessee's claimed sources and bank entries.

Analysis: Section 69 applies where an investment is unrecorded and the assessee fails to offer a satisfactory explanation of its nature and source. The capital introduced in the proprietary business was disclosed, and the assessee identified personal-bank funds, loan repayment, LIC maturity proceeds and FD/OD withdrawals as sources. Reconciliation of bank entries, borrower confirmation and documents supporting the stated receipts were material to verification of the explanation. If those records establish the claimed sources, the addition under section 69 and the bank-credit difference addition cannot survive.

Conclusion: The source-of-capital and bank-credit additions were restored for fresh verification after giving the assessee an opportunity to furnish relevant evidence, in favour of the assessee.

Issue (ii): Whether GST late fee for delayed payment is disallowable as expenditure incurred for a purpose that is an offence or prohibited by law.

Analysis: Explanation 1 to section 37(1) excludes an expense only where its purpose is itself an offence or is prohibited by law. GST late fee is a statutory payment for delay in payment of tax and compensates for the consequence of such delay; it is not expenditure incurred for an unlawful purpose.

Conclusion: GST late fee is allowable as business expenditure and its disallowance was deleted, in favour of the assessee.

Final Conclusion: The capital-source and bank-credit matters require evidence-based verification, whereas the statutory GST late fee remains deductible.

Ratio Decidendi: A statutory late fee paid for delayed tax payment is not expenditure incurred for a purpose that is an offence or prohibited by law merely because it arises from a delay under the taxing statute.

Issues: (i) Whether the delay in filing the appeal should be condoned on sufficient cause; (ii) Whether the indexed cost of acquisition must include the cost of the building transferred along with the land; (iii) Whether deduction under section 54 is available for investment in two adjoining residential flats purchased as a single residential accommodation for assessment year 2012-13.

Issue (i): Whether the delay in filing the appeal should be condoned on sufficient cause.

Analysis: The assessee's advanced age, difficulty in accessing electronic communications, and prompt action after becoming aware of the appellate order established bona fide and sufficient cause. No material indicated mala fides or a deliberate delay. Limitation provisions were applied liberally to advance substantial justice.

Conclusion: The delay in filing the appeal was condoned in favour of the assessee.

Issue (ii): Whether the indexed cost of acquisition must include the cost of the building transferred along with the land.

Analysis: The transferred property comprised both land and the structure standing on it. Although the Assessing Officer had accepted the historical cost attributable to the building, the indexed cost computation omitted that component without any basis. The building's existence and its accepted cost were not disputed; hence, excluding its indexed cost produced an inconsistent capital-gains computation.

Conclusion: The indexed cost must include the building's accepted and allowable cost with corresponding indexation. The Assessing Officer was directed to recompute the capital gains, and the issue was allowed for statistical purposes in favour of the assessee.

Issue (iii): Whether deduction under section 54 is available for investment in two adjoining residential flats purchased as a single residential accommodation for assessment year 2012-13.

Analysis: For the relevant assessment year, section 54 did not contain the later express restriction of investment in one residential house in India. The expression "a residential house" permitted exemption where multiple units substantively formed one residential accommodation. The flats were adjoining, purchased on the same date, and intended for use as one residential unit; the later amendment effective from 01.04.2015 did not apply.

Conclusion: Deduction under section 54 was allowable for investment in both adjoining flats, subject to verification of the actual investment and satisfaction of the remaining statutory conditions, in favour of the assessee.

Final Conclusion: The capital gains require recomputation after granting indexation for the allowable building cost and deduction for investment in both adjoining flats.

Ratio Decidendi: Under the pre-amendment section 54 regime, investment in adjoining residential units acquired and intended as a single residential accommodation may qualify for exemption as investment in a residential house.

Issues: (i) Whether input tax credit relating to acquisition of leasehold rights in an industrial plot could be denied as blocked credit under Section 17(5)(d) of the Central Goods and Services Tax Act, 2017; (ii) Whether proceedings under Section 74(1) of the Central Goods and Services Tax Act, 2017 could be invoked on allegations of fraud, wilful misstatement or suppression in respect of such credit.

Issue (i): Whether input tax credit relating to acquisition of leasehold rights in an industrial plot could be denied as blocked credit under Section 17(5)(d) of the Central Goods and Services Tax Act, 2017.

Analysis: Assignment or transfer of leasehold rights in a plot allotted by the industrial development corporation constitutes transfer of benefits arising from immovable property and does not qualify as a supply under Section 7(1)(a), read with Clause 5(b) of Schedule II and Clause 5 of Schedule III, nor is it chargeable under Section 9. Section 17(5)(d) presupposes a lawfully taxable inward supply and applies only to goods or services received for construction of immovable property. No construction activity was involved in the transfer of leasehold rights.

Conclusion: The input tax credit could not be characterised as blocked credit under Section 17(5)(d). The issue is decided in favour of the assessee.

Issue (ii): Whether proceedings under Section 74(1) of the Central Goods and Services Tax Act, 2017 could be invoked on allegations of fraud, wilful misstatement or suppression in respect of such credit.

Analysis: Since the underlying transaction was not taxable and the credit was not ineligible under Section 17(5)(d), the statutory prerequisites for fraud-based recovery under Section 74(1) were absent. The tax collected on the subsequent transfer of leasehold rights had also been deposited with the Government.

Conclusion: Invocation of Section 74(1) on allegations of fraud, wilful misstatement or suppression was unsustainable. The issue is decided in favour of the assessee.

Final Conclusion: A demand founded on the premise that acquisition of leasehold rights constitutes taxable construction-related inward supply lacks statutory basis.

Ratio Decidendi: Transfer of leasehold rights in land is a transfer of benefits arising from immovable property, not a taxable supply; consequently, the blocked-credit restriction for construction of immovable property cannot be applied to such a transaction.

Issues: Whether the petitioner was entitled to regular bail under the Prevention of Money-laundering Act, 2002 despite the statutory twin conditions, having regard to prolonged incarceration and delay in investigation and trial.

Analysis: Section 45 of the Prevention of Money-laundering Act, 2002 imposes additional restrictions on bail but does not create an absolute bar. The petitioner had remained in judicial custody for over two years; charges had not been framed in the money-laundering case, the predicate-offence charge sheet had not been filed despite substantial delay, and further investigation was expected to continue. Since adjudication of the money-laundering case depended upon the scheduled offence, there was no reasonable prospect of an early trial. Continued detention in those circumstances would impair the right to personal liberty and speedy trial under Article 21 of the Constitution of India. The apprehension of witness influence could be addressed through stringent bail conditions.

Conclusion: The petitioner was entitled to regular bail notwithstanding the restrictions under Section 45 of the Prevention of Money-laundering Act, 2002.