Issues: Whether the assessment framed under section 143(3) of the Income-tax Act, 1961 was void for want of a valid notice under section 143(2) issued by the competent authority in accordance with the CBDT instructions governing pecuniary jurisdiction.

Analysis: The assessee's returned income exceeded the monetary threshold prescribed for metro corporate cases, so the jurisdiction to issue notice under section 143(2) vested exclusively in the Deputy Commissioner of Income Tax or Assistant Commissioner of Income Tax. The notice was, however, issued by an Income Tax Officer, who lacked the requisite pecuniary jurisdiction under CBDT Instruction No. 01/2011 dated 31.01.2011 read with CBDT Instruction No. 06/2011 dated 08.04.2011. The defect was treated as going to the root of the assumption of jurisdiction and not as a mere irregularity in service, so section 292B did not cure it.

Conclusion: The notice under section 143(2) was invalid and the assessment was vitiated for want of jurisdiction.

Final Conclusion: The appeal succeeded and the assessment order was quashed.

Ratio Decidendi: A notice under section 143(2) issued by an lacking the prescribed pecuniary jurisdiction is a jurisdictional defect that renders the assessment void ab initio and is not curable under section 292B of the Income-tax Act, 1961.

Issues: (i) Whether the delay of 520 days in filing the appeal deserved to be condoned; (ii) Whether transfer pricing adjustment could be sustained in respect of advertising, marketing and promotion expenses on application of the bright line test.

Issue (i): Whether the delay of 520 days in filing the appeal deserved to be condoned.

Analysis: The delay was explained as arising from administrative circumstances, including transfer of charge among officers. The length of delay was substantial, but the reasons furnished were accepted as sufficient for the purpose of condonation.

Conclusion: The delay was condoned.

Issue (ii): Whether transfer pricing adjustment could be sustained in respect of advertising, marketing and promotion expenses on application of the bright line test.

Analysis: The issue had already been considered in the assessee's own earlier and subsequent assessment years, and the consistent view, including reliance on the Delhi High Court decision in Sony Ericsson Mobile Communications India Pvt. Ltd. v. CIT, was that the bright line test could not be applied for making an adjustment in respect of AMP expenses. No factual distinction or subsequent change in law was shown to justify a different view.

Conclusion: The transfer pricing adjustment on AMP expenses was not sustainable and the relief granted by the first appellate authority called for no interference.

Final Conclusion: The appeal was dismissed and the order granting relief to the assessee was sustained.

Ratio Decidendi: A transfer pricing adjustment in respect of AMP expenses cannot be made by applying the bright line test where the issue stands covered by earlier binding or consistent decisions and no distinguishing facts or change in law is shown.

Issues: Whether the assessment under Section 143(3) of the Income-tax Act, 1961 was invalid for want of service of notice under Section 143(2) of the Income-tax Act, 1961.

Analysis: The Tribunal found that the record showed the notice under Section 143(2) had bounced and was not served on the assessee. Since service of the statutory notice is a jurisdictional requirement for completing scrutiny assessment under Section 143(3), the absence of service rendered the assessment legally unsustainable. The Tribunal held that the first appellate authority had correctly treated the defect as going to the root of jurisdiction and had rightly quashed the assessment.

Conclusion: The assessment under Section 143(3) was held to be invalid for non-service of notice under Section 143(2), and the Revenue's challenge failed.

Final Conclusion: The appellate order annulling the assessment was sustained, and the Revenue's appeal was dismissed.

Ratio Decidendi: Service of notice under Section 143(2) is a mandatory jurisdictional prerequisite for a valid scrutiny assessment under Section 143(3), and non-service vitiates the assessment.

Issues: Whether the addition made as unexplained investment under section 69A could be sustained when the assessee had not sold the shares during the relevant assessment year and the reopening was based on an investigation report without independent verification.

Analysis: The reassessment was initiated on the premise that the assessee had claimed bogus long-term capital gains and exemption in respect of shares of Yes Bank Ltd. and Eicher Motors Ltd. However, the record showed that no sale of those shares had taken place during the relevant year and no long-term capital gain had been declared for that assessment year. The addition eventually made under section 69A did not match the stated reason for reopening, and the conclusion rested only on the investigation report without independent enquiry by the Assessing Officer. Since the shares were acquired in an earlier year, the investment could not be treated as unexplained investment in the relevant assessment year.

Conclusion: The addition under section 69A was not sustainable and was directed to be deleted.

Final Conclusion: The assessee succeeded and the impugned addition was set aside.

Ratio Decidendi: An addition as unexplained investment cannot be sustained for the relevant year when the alleged investment was made in an earlier year and the reopening or addition is based only on an external report without independent enquiry and without any corresponding sale or income claim in that year.

Issues: (i) Whether the section 153C assessments for the relevant assessment years were valid when the satisfaction note did not record that the seized material had a bearing on ination of the assessee's total income.

Analysis: The search action was carried out under section 132 of the Income-tax Act, 1961, and the impugned proceedings were initiated after the recorded satisfaction of the searched party's Assessing Officer and the assessee's jurisdictional Assessing Officer. The decisive requirement was whether the satisfaction note clearly stated that the seized material had a bearing on determination of the assessee's total income. As that element was not recorded, the statutory basis for invoking section 153C was held to be deficient.

Conclusion: The section 153C assessments were held to be invalid and non-est, and the assessee succeeded on this issue.

Final Conclusion: The common order resulted in the assessee succeeding on the jurisdictional challenge to the assessments, with the Revenue's appeals dismissed and the cross objections allowed.

Ratio Decidendi: For a valid assumption of jurisdiction under section 153C, the satisfaction note must expressly show that the seized material has a bearing on determination of the assessee's total income.

Issues: Whether the addition made on account of cash deposits during the demonetisation period was sustainable when the assessee produced books of account, cash book, bank statement, cash sales details, VAT returns and audited financial statements and the books were not rejected.

Analysis: The cash deposits were explained by the assessee as arising from recorded cash sales. The record showed cash book entries, bank deposit details, quarterly VAT returns reflecting sales, and audited accounts tallying with the declared turnover. No defect in the books of account was recorded and no rejection of books was made. In such a situation, an addition solely on the basis of cash deposits, while the corresponding sales were already accepted as business receipts supported by regular records, would amount to duplicative taxation. The reference to section 40A(3) did not dislodge the evidentiary value of the material produced by the assessee for explaining the source of cash deposits.

Conclusion: The addition of Rs. 37,75,000/- was deleted and the issue was decided in favour of the assessee.

Final Conclusion: The appeal succeeded on the sole disputed addition, while the remaining grounds, not pressed, did not survive for adjudication.

Ratio Decidendi: When cash deposits are satisfactorily linked to recorded sales supported by regular books and statutory returns, and the books are not rejected, an addition for unexplained cash deposit cannot be sustained on the same business receipts.

Issues: Whether cancellation of approval/registration under the charitable provisions was justified on the ground that the assessee's activities were rendered under an agreement with another foundation and constituted paid services rather than charitable activity.

Analysis: The assessee placed the trust deed, memorandum of understanding, invoices raised on an activity basis, beneficiary details, and confirmation from the other foundation indicating that the programme was being run for social impact and knowledge transfer to support youth from underprivileged communities. The decisive question was whether the activities, viewed in the light of the objects of the trust and the actual benefit extended to students and candidates from government schools without monetary consideration, could be treated as non-charitable merely because funds moved under contractual arrangements between two entities engaged in similar work. The issue had not been examined by the first authority on the correct factual and legal footing.

Conclusion: The matter required fresh examination by the Commissioner of Income-tax (Exemption) on merits, and the cancellation could not be sustained without such inquiry.

Final Conclusion: The appeals succeeded to the extent that the impugned issue was restored for reconsideration, leaving the substantive question open for a fresh decision.

Ratio Decidendi: Contractual receipts or inter-entity funding do not by themselves negate charitable character where the beneficiaries are shown to have received the services without payment and the activities are aligned with the trust's objects.

Issues: Whether the addition made as deemed dividend under section 2(22)(e) of the Income-tax Act, 1961 was sustainable in the absence of any actual advance or loan by the company to the shareholders/directors.

Analysis: The provision applies only where there is a payment by a company by way of advance or loan to a shareholder. On the facts found, there was no material to show that the company had made any such payment to the assessees. The addition was made by treating a disallowance of bogus purchases as if it represented dividend distribution, which rested only on assumptions and presumptions. A charging provision in a fiscal statute must be construed strictly, and the deeming fiction could not be extended beyond its clear terms.

Conclusion: The deemed dividend addition was unsustainable and was deleted in full, in favour of the assessees.

Final Conclusion: The assessees succeeded and the Revenue's cross appeals failed, with the entire addition under section 2(22)(e) set aside.

Ratio Decidendi: Section 2(22)(e) can be invoked only on proof of an actual advance or loan by the company to a shareholder, and a deemed dividend cannot be inferred merely from unrelated disallowance or presumptive cash generation.

Issues: Whether the deletion of addition made on account of alleged bogus long-term capital gains and unexplained expenditure in share transactions was justified.

Analysis: The Revenue challenged the relief granted by the first appellate authority in respect of the assessee's claim of exemption on sale of shares. The record showed that the shares were acquired through banking channels, reflected in the demat account, held for the requisite period, sold through a recognised stock exchange, and supported by contract notes and bank statements. The addition was founded mainly on general investigation material, alleged penny stock manipulation, and suspicion arising from the rise in share price. No direct material connected the assessee with any entry operator, broker misconduct, or sham arrangement, and no independent enquiry rebutting the documentary evidence was brought on record. The appellate authority's view was consistent with prior decisions on the same scrip and similar facts, where the claim was accepted in the absence of cogent contrary evidence.

Conclusion: The deletion of the addition was upheld and the Revenue's challenge failed.

Final Conclusion: The assessee's claim of exempt long-term capital gains remained accepted, and the additions made by the Assessing Officer did not survive.

Ratio Decidendi: A claim of long-term capital gains cannot be rejected merely on suspicion or general investigation reports when the assessee's transaction is supported by primary documentary evidence and the Revenue fails to adduce cogent material showing the transaction to be sham.

Issues: Whether the final assessment orders were vitiated for non-compliance with the procedure under section 144C of the Income-tax Act, 1961, in that no draft assessment order was issued after the matter was remanded for fresh adjudication.

Analysis: The additional ground raised a pure question of law arising from the record and was therefore admitted. The remand proceedings were treated as fresh assessment proceedings, and the Assessing Officer, after obtaining approval and making a fresh reference to the Transfer Pricing Officer, proceeded directly to pass final assessment orders. As the statutory procedure under section 144C(1) required issuance of a draft assessment order before passing the final order, the assessee was deprived of the statutory right to approach the Dispute Resolution Panel. Such non-compliance was held to vitiate the assessment proceedings and was not a mere irregularity or curable defect.

Conclusion: The assessments were invalid for breach of section 144C(1) of the Income-tax Act, 1961, and the additional ground was allowed.

Ratio Decidendi: Where, in a case covered by section 144C of the Income-tax Act, 1961, the Assessing Officer fails to issue a draft assessment order before passing the final assessment order, the assessment is vitiated because the omission deprives the assessee of a substantive statutory remedy and is not a curable procedural defect.

Issues: Whether gains arising to the assessee from the buy-back of shares by its Indian subsidiary were covered by Article 13(5) of the India-Netherlands DTAA and consequently taxable only in the Netherlands.

Analysis: The expression "corporate organisation, reorganization, amalgamation, division or similar transaction" was held to have to be understood in its ordinary legal sense, read in the context of the treaty and the applicable domestic law. Buy-back of shares was treated as capable of constituting corporate reorganisation where it formed part of a transaction within the same corporate group and resulted in a material change in the financial structure of the company. The reasoning relied on recognised legal meanings of reorganisation, guidance materials on corporate restructuring, and the view that a narrow interpretation would defeat the purpose of Article 13(5). On the facts, the buy-back was accepted as a group-level transaction falling within the treaty exception.

Conclusion: The gains from the buy-back were held to fall within Article 13(5) and were not taxable in India; the assessee succeeded.

Issues: Whether the reassessment notice issued under section 148 beyond three years from the end of the relevant assessment year was invalid for want of approval from the Principal Chief Commissioner of Income Tax under section 151(ii), and whether the consequential reassessment proceedings were liable to be quashed.

Analysis: The notice under section 148 was issued on 13.04.2022 for Assessment Year 2018-19, which was beyond three years from the end of the relevant assessment year. In that situation, the prescribed sanctioning authority under section 151(ii) was the Principal Chief Commissioner of Income Tax or the equivalent higher authority. Approval having been obtained only from the Principal Commissioner of Income Tax, the sanction did not satisfy the statutory requirement. The reassessment could not be sustained on the basis of approval granted for the earlier stage under section 148A(b), because a separate and valid sanction was required for issuance of notice under section 148 and for the order under section 148A(d). The defect went to jurisdiction and vitiated the entire reassessment process.

Conclusion: The notice under section 148 was invalid and the reassessment proceedings were liable to be quashed, in favour of the assessee.

Issues: (i) whether the Revenue's appeal was liable to be dismissed for low tax effect under the CBDT circular; (ii) whether the tax rate under section 115BBE of the Income-tax Act, 1961 was applicable to the transactions in question for computing tax effect.

Issue (i): whether the Revenue's appeal was liable to be dismissed for low tax effect under the CBDT circular.

Analysis: The tax effect was computed on the basis of the additions made by the Assessing Officer, and on the normal provisions the figure was below the monetary limit prescribed by the binding circular. The assessee's computation was not controverted by the Revenue, and the appeal therefore fell within the low tax effect bar.

Conclusion: The appeal was not maintainable and stood dismissed on the ground of low tax effect.

Issue (ii): whether the tax rate under section 115BBE of the Income-tax Act, 1961 was applicable to the transactions in question for computing tax effect.

Analysis: The applicability of the higher rate under section 115BBE was treated as confined to transactions on or after 01.04.2017, and the transactions involved in the present case were prior to that date. The tax effect was therefore to be determined under the normal provisions rather than at the higher rate.

Conclusion: Section 115BBE did not apply to enhance the tax effect in the present case.

Final Conclusion: The Revenue's appeal was dismissed as falling below the applicable monetary limit, and the substantive grounds were left open.

Ratio Decidendi: Where the tax effect computed under the applicable normal provisions falls below the CBDT-prescribed monetary limit, the Revenue's appeal is not maintainable; the higher rate under section 115BBE cannot be applied to transactions predating its operative date to enlarge the tax effect.

Issues: (i) Whether the ESOP cross-charge incurred by the Indian entity for shares granted to its employees by the foreign parent company was allowable as a revenue expenditure under section 37(1) of the Income-tax Act, 1961.

Analysis: The expenditure was treated as employee compensation cost incurred to secure and retain employee services during the vesting period. The binding jurisdictional precedent held that ESOP discount/cross-charge constitutes expenditure for business purposes and that such liability is ascertained rather than contingent. The fact that the parent company issued the shares did not alter the character of the payment in the hands of the Indian entity, and the coordinate bench decisions followed the same view. The pendency of challenge before the Supreme Court did not displace the binding force of the jurisdictional High Court ruling.

Conclusion: The ESOP cross-charge was allowable as revenue expenditure, and the disallowance was deleted in favour of the assessee.

Issues: (i) Whether the penalty imposed under Section 112 of the Customs Act, 1962 was sustainable in the absence of evidence linking the appellant to the offence. (ii) Whether the penalty imposed under Section 117 of the Customs Act, 1962 was justified when the appellant had recorded a statement and cooperated with the investigation despite not appearing to the summons.

Issue (i): Whether the penalty imposed under Section 112 of the Customs Act, 1962 was sustainable in the absence of evidence linking the appellant to the offence.

Analysis: The record showed that the appellant was engaged in business in foodgrains and pulses and had a business relationship with the consignor. No material was brought on record to establish that the appellant had committed any offence attracting penal liability under Section 112.

Conclusion: The penalty under Section 112 of the Customs Act, 1962 was not substantiated and was set aside.

Issue (ii): Whether the penalty imposed under Section 117 of the Customs Act, 1962 was justified when the appellant had recorded a statement and cooperated with the investigation despite not appearing to the summons.

Analysis: Though summons had been issued on more than one date, the appellant's statement was recorded during the investigation. The recorded statement established cooperation, and the circumstances did not justify penal action solely on the ground of non-appearance.

Conclusion: The penalty under Section 117 of the Customs Act, 1962 was not warranted and was set aside.

Final Conclusion: Both penalties were annulled, and the appeal succeeded with consequential relief as permissible in law.

Ratio Decidendi: A penalty cannot be sustained without evidentiary linkage to the alleged offence, and non-appearance to summons does not justify penalty where the person has otherwise cooperated with the investigation.

Issues: (i) Whether freight and insurance were liable to be added to the declared FOB value under Rule 10(2) of the Customs Valuation Rules, 2007. (ii) Whether the notice invoking the extended period was sustainable on the grounds of suppression and wilful misstatement.

Issue (i): Whether freight and insurance were liable to be added to the declared FOB value under Rule 10(2) of the Customs Valuation Rules, 2007.

Analysis: Section 14(1) of the Customs Act, 1962 fixes valuation on the transaction value, and Rule 10(2) of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 permits loading where transportation cost is not ascertainable, with freight and insurance additions being attracted on the facts. The declared FOB basis was not supported by cogent documentary material showing that FOB and CIF were identical or that transportation and insurance were nil. The invoice terms indicated ex-works responsibility and risk with the buyer, supporting the departmental case for loading the assessable value.

Conclusion: The addition of freight and insurance was upheld against the appellant.

Issue (ii): Whether the notice invoking the extended period was sustainable on the grounds of suppression and wilful misstatement.

Analysis: The appellant had disclosed the FOB value and nil freight in the bill of entry documentation, and the Revenue did not establish a conscious withholding of material facts or deliberate misstatement. The dispute was treated as one of valuation interpretation, and the availability of credit rendered the matter revenue neutral. In such circumstances, the ingredients required to invoke the extended period under Section 28(4) of the Customs Act, 1962 were not satisfied.

Conclusion: The invocation of the extended period was held unsustainable in favour of the appellant.

Final Conclusion: The appeal succeeded because the demand could not be sustained through the extended limitation route, and the impugned order was set aside.

Ratio Decidendi: The extended period of limitation under customs law cannot be invoked unless the Revenue proves a conscious suppression of material facts or wilful misstatement; a valuation dispute supported by disclosure and revenue-neutral consequences does not by itself establish such suppression.

Issues: Whether the enhancement of the assessable value of imported goods was sustainable when the declared transaction value was supported by invoice and banking documents, and whether the duty and interest paid under protest were refundable with interest.

Analysis: Section 14(1) of the Customs Act, 1962 gives primacy to transaction value for imported goods. Under Rule 3(1) and Rule 3(2) of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007, the declared value must be accepted unless there are valid grounds to reject it. Rule 12 requires the proper officer to have reasonable doubt about the truth or accuracy of the declared value before moving sequentially through the valuation rules. The recorded facts showed invoice support, banking remittances, and comparable earlier imports near the declared rate, while the Department relied mainly on a later and isolated comparative entry without first discarding the transaction value on cogent grounds. The enhancement was therefore held to be contrary to the statutory valuation sequence, and the amount paid under protest was treated as not lawfully payable.

Conclusion: The enhancement of assessable value was unsustainable. The duty and interest paid under protest were held refundable with applicable interest.

Final Conclusion: The appeal succeeded, the enhanced valuation was set aside, and consequential refund relief with interest followed.

Ratio Decidendi: Customs valuation must proceed from the declared transaction value, and it can be rejected only on recorded reasonable doubt under Rule 12 before resorting sequentially to the alternative valuation methods.

Issues: (i) Whether freight and insurance were liable to be added to the declared FOB value for arriving at the assessable value; (ii) whether the demand was barred by limitation and the extended period could be invoked on the basis of suppression or wilful misstatement.

Issue (i): Whether freight and insurance were liable to be added to the declared FOB value for arriving at the assessable value.

Analysis: The dispute turned on valuation under Section 14 of the Customs Act, 1962 and Rule 10(2) of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007. The importer claimed that FOB and CIF values were effectively the same for the Bhutan land-border imports and that no transit cost existed between the points of export and import. The Tribunal held that this assertion required documentary substantiation, which was not produced. In the absence of a contractual or record-based demonstration that the transaction was truly on CIF terms or that transportation and insurance were nil and ascertainable, the declared FOB value could not be accepted as the final assessable value. The terms printed on the invoice-cum-challan also indicated buyer's risk and that responsibility ceased when the truck left the factory premises, supporting the Revenue's case that freight and insurance had to be loaded in accordance with the valuation rules.

Conclusion: The addition of freight and insurance to the FOB value was sustained.

Issue (ii): Whether the demand was barred by limitation and the extended period could be invoked on the basis of suppression or wilful misstatement.

Analysis: The show cause notice invoked the extended period under Section 28(4) of the Customs Act, 1962. The Tribunal found that the importer had disclosed the FOB value and, in the sample documents examined, had also indicated nil freight and the insurance element in the self-assessed declaration. On those facts, the Department failed to establish a positive act of suppression or deliberate misstatement. The Tribunal also treated the dispute as one of interpretation and noted that the matter was revenue neutral, since any additional duty paid would have been available as credit. In these circumstances, the strict requirements for invoking the extended period were not satisfied.

Conclusion: The extended period of limitation was not invocable and the demand was time-barred.

Final Conclusion: The appeal succeeded on limitation, the impugned order was set aside, and the demand, interest and penalty did not survive.

Ratio Decidendi: The extended limitation period under customs law cannot be invoked unless the Revenue proves a conscious suppression of material facts or wilful misstatement by positive evidence; a bona fide valuation dispute disclosed in the import documents, especially in a revenue-neutral setting, does not satisfy that standard.

Issues: Whether penalty under Section 114 of the Customs Act, 1962 was sustainable against a Customs House Agent who permitted use of his licence without due diligence and thereby facilitated attempted export of prohibited red sanders.

Analysis: Section 114 fastens liability on any person who, in relation to goods, does or omits to do any act or omission rendering the goods liable to confiscation under Section 113, and separately refers to abetment. The provision was held to create liability on the basis of the act or omission itself, without requiring proof of conscious and knowing involvement for the first limb. On the findings, the appellant permitted misuse of his CHA licence, had no direct dealings with the exporter, exercised no supervision, and his omissions formed part of the transaction that led to the attempted smuggling of prohibited goods liable to confiscation.

Conclusion: Penalty under Section 114 of the Customs Act, 1962 was upheld and the challenge by the appellant failed.

Issues: Whether the appeal was filed within limitation under Section 61(2) of the Insolvency and Bankruptcy Code, 2016, and within the maximum condonable period.

Analysis: The appeal under Section 61(2) had to be filed within 30 days, with a further condonable period not exceeding 15 days. The limitation was held to commence from the date of pronouncement of the order in open court, not from the date of uploading. The order recorded delivery on 21.04.2025, and there was no material to show that it was not pronounced on that date. Uploading was treated as an administrative act and not the trigger for limitation. On that computation, the appeal filed on 10.06.2025 was beyond the outer limit of 45 days, and the Tribunal could not entertain it. The merits of the restoration challenge were not examined because the limitation bar was held to be decisive.

Conclusion: The appeal was time-barred and not maintainable, and the limitation objection succeeded against the appellant.

Ratio Decidendi: For an appeal under Section 61(2) of the Insolvency and Bankruptcy Code, 2016, limitation begins from the date of pronouncement in open court, and once the statutory period of 30 days plus the maximum condonable 15 days expires, the appellate tribunal lacks jurisdiction to entertain the appeal.