Issues: Whether the entire Rs. 12,03,500 cash-deposit addition under section 69A, taxable under section 115BBE, should be sustained where the supporting cash records were self-prepared and unaudited.

Analysis: Section 69A governs unexplained money, while the charge under the Income-tax Act is on income and not on gross receipts. The cash records, bank material and related documents produced did not justify complete acceptance because the books were self-prepared and not subject to audit. At the same time, the material did not warrant taxing the entire cash deposit as income. An estimated profit component was considered appropriate to account for the inconsistencies while protecting revenue.

Conclusion: The addition is restricted to Rs. 1,20,350, being 10% of Rs. 12,03,500, taxable at normal rates and not under section 115BBE; the issue is decided partly in favour of the assessee.

Issues: Whether estimated additions for alleged on-money receipts from sale of flats could be sustained under Section 69A of the Income-tax Act, 1961 without corroborative evidence of the assessee's receipt.

Analysis: The seized material evidenced on-money receipts of a specified amount which had been accepted as income and offered to tax by the person managing the project. The further additions were derived by applying an average sale rate to other flat sales, without material evidencing that the assessee had received additional on-money. An addition under Section 69A cannot rest solely on such uncorroborated estimation.

Conclusion: The estimated additions for alleged on-money receipts under Section 69A of the Income-tax Act, 1961 cannot be sustained and are deleted.

Issues: (i) Whether a 20% ad hoc disallowance of claimed business expenditure was sustainable without rejection of audited books or identification of bogus or unsupported expenditure; (ii) Whether the disallowance for cash payments under section 40A(3) required fresh verification of the payment recipients, business expediency, and the exceptions under Rule 6DD(e).

Issue (i): Whether a 20% ad hoc disallowance of claimed business expenditure was sustainable without rejection of audited books or identification of bogus or unsupported expenditure.

Analysis: The expense entries and apparent discrepancies in nomenclature were explained through ledger extracts, cash-book details, and supporting vouchers. The audited books were not rejected, no particular expenditure was found bogus or unsupported, and no defect was identified in the revised clarification. A blanket 20% disallowance founded merely on doubts arising from differently described entries was therefore conjectural.

Conclusion: The ad hoc disallowance of business expenditure is deleted in favour of the assessee.

Issue (ii): Whether the disallowance for cash payments under section 40A(3) required fresh verification of the payment recipients, business expediency, and the exceptions under Rule 6DD(e).

Analysis: Section 40A(3) restricts deductions for specified cash payments, while Rule 6DD(e) provides an exception for payments for specified animal-husbandry produce, including hides and skins. The record required verification of whether payments exceeding the threshold were made to different persons, whether business expediency justified the payments, and whether the statutory exception applied. These matters had not been adequately examined.

Conclusion: The cash-payment disallowance is set aside and remitted to the Assessing Officer for fresh verification and recomputation.

Final Conclusion: The unsupported ad hoc expense disallowance is removed, while the cash-payment question requires fresh statutory verification.

Ratio Decidendi: An ad hoc disallowance of expenditure cannot rest on conjecture where audited books are not rejected and no expenditure is found bogus or unsupported.

Issues: Whether rejection of the rectification application was valid where no mistake apparent from the record was established.

Analysis: Section 154 of the Income-tax Act, 1961 permits correction only of a mistake apparent from the record and cannot be invoked to review or reopen an issue requiring reconsideration beyond that limited jurisdiction. The original appeal had not been admitted under Section 249(3) of the Income-tax Act, 1961 because the delay in filing it was not condoned. The rectification application did not demonstrate any apparent mistake in that order. The grounds concerning the merits of the deduction claim and consequential interest were not adjudicated because the appeal was confined to rejection of rectification.

Conclusion: Rejection of the rectification application was valid; the issue is decided against the assessee.

Issues: Whether interest earned on fixed deposits and Kisan Vikas Patras, though assessable under the head income from other sources, must be included in book profit for computing the ceiling of partners' remuneration under Section 40(b) of the Income-tax Act, 1961.

Analysis: Explanation 3 to Section 40(b) adopts the net profit shown in the partnership firm's profit and loss account as the basis for book profit. The applicable measure is the commercial profit reflected in that account, rather than only the income computed under the head profits and gains of business or profession. The interest income formed part of the profit and loss account, and no contrary authority was shown to justify its exclusion from book profit.

Conclusion: Interest on fixed deposits and Kisan Vikas Patras included in the profit and loss account cannot be excluded while determining book profit for allowable partners' remuneration; the consequential disallowance was deleted.

Issues: Whether the notice issued under Section 148 of the Income-tax Act, 1961 for Assessment Year 2016-17 was barred by limitation, thereby invalidating the reassessment.

Analysis: Section 149(1)(a) permitted reassessment notice within three years from the end of the relevant assessment year. The extended period under Section 149(1)(b) was available only where the prescribed material revealed escaped income of at least Rs. 50 lakhs. The recorded figure of Rs. 57,57,235 included Rs. 17,00,500 twice, as that amount formed part of the total cash deposits of Rs. 26,30,500. After excluding the duplicate counting of income, the alleged escaped income was Rs. 40,56,735, below the statutory threshold. A valid jurisdictional notice within limitation was necessary to assume reassessment jurisdiction.

Conclusion: The notice dated 27.03.2023 was barred by limitation; consequently, the reassessment order was without jurisdiction and stood quashed.

Issues: (i) Whether renewal registration under Section 12AB could be refused solely because the educational society charged substantial fees and generated surplus; (ii) Whether the delay in filing Form 10AB should be condoned.

Issue (i): Whether renewal registration under Section 12AB could be refused solely because the educational society charged substantial fees and generated surplus.

Analysis: Section 2(15) recognises education as a charitable purpose, and the inquiry at the registration stage under Section 12AB focuses on the society's objects and the genuineness of its activities. The educational objects and their implementation were undisputed. The surplus was generated from educational activities, applied or accumulated for those objects, and was not diverted for non-charitable purposes or for the benefit of members. Fees charged and the quantum of surplus, by themselves, do not establish a profit-making motive where the surplus is incidental to imparting education.

Conclusion: Renewal registration under Section 12AB cannot be denied merely because fees are substantial or surplus is generated; the society is entitled to registration.

Issue (ii): Whether the delay in filing Form 10AB should be condoned.

Analysis: The authority did not specifically adjudicate limitation, while the society had filed a condonation request explaining the delay. The explanation furnished warranted condonation.

Conclusion: The delay in filing Form 10AB is condoned.

Final Conclusion: The authority is required to condone the delay and grant registration under Section 12AB pursuant to the renewal application.

Ratio Decidendi: At the registration stage, incidental surplus from educational activities cannot alone negate charitable status where the institution pursues its educational objects and does not divert funds for non-charitable purposes.

Issues: (i) Whether refusal to condone the delay in filing the first appeal warranted restoration for examination of the addition for unexplained money; (ii) Whether the penalty founded on the addition could survive after the quantum matter was restored for fresh adjudication.

Issue (i): Whether refusal to condone the delay in filing the first appeal warranted restoration for examination of the addition for unexplained money.

Analysis: The assessment was completed ex parte by treating cash deposits as unexplained money under Section 69A of the Income-tax Act, 1961 and applying Section 115BBE of the Income-tax Act, 1961. The explanation that the deposits related to transactions undertaken as a Banking Mitra on behalf of the bank and its customers, with only commission constituting income, had not been tested against supporting material. In the interest of substantial justice, verification of bank records, appointment documents, transaction particulars and commission statements was required with a reasonable opportunity of hearing.

Conclusion: In favour of the assessee, the assessment and appellate orders were set aside and the matter was restored for de novo adjudication of the nature and source of the deposits.

Issue (ii): Whether the penalty founded on the addition could survive after the quantum matter was restored for fresh adjudication.

Analysis: The penalty under Section 271AAC(1) of the Income-tax Act, 1961 was consequential upon the addition that had been set aside for fresh determination.

Conclusion: In favour of the assessee, the existing penalty was deleted, without precluding fresh penalty proceedings in accordance with law if warranted by the reassessment outcome.

Final Conclusion: The taxability of the deposits requires fresh evidentiary verification, and the existing penalty order ceases to operate pending that determination.

Issues: (i) Whether long-term capital gain claimed as exempt on sale of penny-stock shares could be assessed as unexplained cash credit; (ii) Whether penalty for the resulting non-genuine share transaction was sustainable.

Issue (i): Whether long-term capital gain claimed as exempt on sale of penny-stock shares could be assessed as unexplained cash credit.

Analysis: Under Section 68 of the Income-tax Act, 1961, the claim for exemption under Section 10(38) was tested against specific investigation material, the financial and market behaviour of the scrip, and the surrounding circumstances. Routing transactions through a recognised stock exchange and banking channels was not by itself conclusive of genuineness. The abnormal price appreciation, absence of comparable investment activity, and failure to rebut the investigation findings or substantiate the acquisition of shares sustained the Revenue's case on the preponderance of probabilities and evidential burden principles.

Conclusion: The claimed long-term capital gain was treated as non-genuine and the addition as unexplained cash credit under Section 68 read with Section 115BBE of the Income-tax Act, 1961, was sustained against the assessee.

Issue (ii): Whether penalty for the resulting non-genuine share transaction was sustainable.

Analysis: The penalty under Section 271(1)(c) of the Income-tax Act, 1961 was founded on the same addition, which remained sustained. Disclosure of the share transactions in the return did not displace the finding that they were non-genuine accommodation entries.

Conclusion: The penalty under Section 271(1)(c) of the Income-tax Act, 1961 was sustained against the assessee.

Final Conclusion: The exemption claim and its consequential penal liability failed because the impugned share receipts were not established as genuine transactions.

Ratio Decidendi: Stock-exchange routing and banking documentation do not by themselves establish the genuineness of a share transaction where specific investigation material and surrounding circumstances show it to be an accommodation entry and remain unrebutted.

Issues: Whether the claimed deduction for a political donation was allowable under Section 80GGC of the Income-tax Act, 1961.

Analysis: Section 80GGC permits deduction only for a genuine qualifying contribution. The investigation material, statements recorded during search, bank-trail analysis, and the established modus operandi of systematic layering of funds showed that the recipient political party was used for accommodation entries. Applying the test of human probabilities and preponderance of probabilities, payment through banking channels and production of a donation receipt did not establish the genuineness of the contribution or displace the evidence that the apparent transaction was not real.

Conclusion: The claimed political donation was not genuine and the deduction under Section 80GGC of the Income-tax Act, 1961 was not allowable; the issue is decided against the assessee.

Issues: Whether deduction under Section 80GGC of the Income-tax Act, 1961 was allowable in respect of the claimed donation to a registered unrecognised political party.

Analysis: Section 80GGC of the Income-tax Act, 1961 permits deduction only for a genuine qualifying political contribution. Payment through banking channels and production of a donation receipt were insufficient where investigation material, unrecanted statements, bank-trail analysis and the established modus operandi of the recipient political party demonstrated systematic accommodation-entry activity. Applying the test of human probabilities and preponderance of probabilities, the apparent transaction was found not to represent its real character.

Conclusion: The claimed contribution was not a genuine donation eligible for deduction under Section 80GGC of the Income-tax Act, 1961; the disallowance was sustained against the assessee.

Issues: Whether an addition of Rs. 8,00,000 as unexplained expenditure under Section 69C read with Section 115BBE could be sustained despite acceptance of presumptive income declared under Section 44AD.

Analysis: The declared turnover, sales and presumptive income computed at the prescribed rate under Section 44AD were accepted. Maintenance of books of account is not mandatory under that presumptive-taxation provision. In the absence of any disturbance to the accepted turnover or presumptive income, the absence of transportation particulars, GST details, cash-book entries or supporting purchase records could not, by itself, justify the addition. The precise nature of the facilitator's business was also not determinative of the claimed purchases.

Conclusion: The addition of Rs. 8,00,000 under Section 69C read with Section 115BBE was unsustainable and was deleted, in favour of the assessee.

Issues: (i) Whether cash entries in a seized electronic worksheet, search statements and statutory presumptions could substantiate substantive additions as the individual assessee's undisclosed income; (ii) Whether the aggregate cash receipts in the seized worksheet could be wholly assessed as the assessee-company's undisclosed income or whether the restriction of additions to 25% was sustainable.

Issue (i): Whether cash entries in a seized electronic worksheet, search statements and statutory presumptions could substantiate substantive additions as the individual assessee's undisclosed income.

Analysis: Sections 132(4A) and 292C of the Income-tax Act, 1961 create rebuttable evidentiary presumptions concerning seized material, while a statement under Section 132(4) is relevant evidence. However, neither the presumptions nor the statements establish personal beneficial ownership or attribution of income without material connecting the entries to the individual. The worksheet was found on a computer used by an employee at the assessee-company's premises; it did not identify the individual as recipient or beneficiary, and no corresponding undisclosed cash, asset, investment, personal expenditure or financial trail was found. The statements referred to company and group business transactions and did not contain an unequivocal admission of personal receipt or appropriation. The absence of a specific opportunity to answer the proposed personal attribution reinforced the evidentiary deficiency. Suspicion arising from managerial association could not take the place of proof.

Conclusion: The substantive additions as the individual assessee's undisclosed income were unsustainable and were rightly deleted in full, in favour of the assessee.

Issue (ii): Whether the aggregate cash receipts in the seized worksheet could be wholly assessed as the assessee-company's undisclosed income or whether the restriction of additions to 25% was sustainable.

Analysis: The seized worksheet, the search statements and the physical cash found supported the existence of cash transactions outside the regular accounts. Nevertheless, the worksheet contained negative balances, discontinuities and arithmetical inconsistencies, and comprised receipts and payments involving withdrawals from disclosed sources, multiple group entities and possible cash recycling. The approximate correspondence between the worksheet's closing balance and cash found established only a relevant corroborative circumstance, not that every gross receipt was fresh taxable income. Although the books were not rejected under Section 145 of the Income-tax Act, 1961, that circumstance was not conclusive; the decisive deficiency was the failure to identify specific fictitious expenditure, correlate it with claimed deductions, segregate entity-wise transactions, or establish the net income component. The presumptions under Sections 132(4A) and 292C did not convert gross running cash entries into taxable income. In these circumstances, estimation of the unaccounted income element at 25% was a permissible assessment of the available evidence.

Conclusion: The restriction of additions to 25% of the recorded amounts and deletion of the remaining 75% were sustained, in favour of the assessee.

Final Conclusion: The seized material could support only an estimated addition in the assessee-company's hands, while it did not establish that any part of the recorded transactions was income personally attributable to the individual assessee.

Ratio Decidendi: Rebuttable presumptions attached to seized documents and search statements do not dispense with proof of the person to whom income is attributable or the taxable character and quantum of running cash entries; aggregate receipts cannot be assessed as income without a reliable nexus to the relevant taxable transaction.

Issues: (i) Whether an earlier decision concerning classification of a cement unit under IPR 2007 governs the VAT-reimbursement claim; (ii) Whether refusal to consider an existing unit's claim for downstream Thrust Sector recognition and VAT reimbursement solely because it was not a new industrial unit is sustainable.

Issue (i): Whether an earlier decision concerning classification of a cement unit under IPR 2007 governs the VAT-reimbursement claim.

Analysis: The earlier ruling requires Negative List classification to be based on the unit's actual industrial activity and value addition, rather than on grinding or mixing as an isolated component of the manufacturing process. However, that matter involved an issued eligibility certificate and a sanctioned reimbursement, whereas the present claim had not reached final sanction or quantification.

Conclusion: The earlier decision is relevant to the classification exercise but does not establish an automatic entitlement to VAT reimbursement.

Issue (ii): Whether refusal to consider an existing unit's claim for downstream Thrust Sector recognition and VAT reimbursement solely because it was not a new industrial unit is sustainable.

Analysis: Clause 18.4(iv) of IPR 2007 covers existing industrial units undertaking expansion, modernisation or diversification. The retrospective amendment deleting the word "new" from the relevant Annexure entries removed the sole basis stated for withholding consideration. The verification and inspection reports recorded substantial post-policy expansion investment, increased capacity, employment, and utilisation of waste products, providing material support for downstream industry status and eligibility for fiscal incentives. Those materials did not, however, amount to a final sanction or quantify the reimbursement. The remaining prescribed criteria require a reasoned administrative decision.

Conclusion: The refusal founded solely on the original unit not being new is unsustainable; downstream Thrust Sector eligibility must be determined on the applicable criteria, followed by determination of admissible VAT reimbursement if such status is affirmed.

Final Conclusion: The retrospective removal of the new-unit condition requires a merits-based determination of downstream Thrust Sector eligibility, after which any reimbursement admissible for increased commercial production is to be quantified under IPR 2007.

Ratio Decidendi: Where an industrial policy retrospectively removes a new-unit requirement and expressly covers expansion of existing units, eligibility cannot be denied solely because the original unit pre-dated the policy; the remaining eligibility conditions must be assessed on the unit's actual operations and record.

Issues: Whether the plaint could be amended to add claims for compensation awarded in cheque-dishonour proceedings, interest, and litigation expenses.

Analysis: The compensation had been determined in criminal proceedings and was recoverable through the statutory enforcement procedure under the Bharatiya Nagarik Suraksha Sanhita, 2023 or the Code of Criminal Procedure, 1973, rather than through the pending civil recovery suit. The proposed claim founded on the criminal compensation order, as well as the claim for expenses incurred in criminal litigation, arose from a cause of action distinct from that pleaded in the suit. Although amendments necessary to resolve the real controversy are ordinarily permissible, an amendment introducing an entirely new cause of action or changing the nature of the suit is impermissible.

Conclusion: The proposed amendment was impermissible; the criminal compensation could not be recovered through the civil suit, and the litigation-expense claim rested on a distinct cause of action.

Issues: Whether the provisional attachment and debit freeze of a payment aggregator's current and escrow accounts under Section 83 of the Central Goods and Services Tax Act, 2017 fulfilled the statutory conditions.

Analysis: Section 83 permits attachment only after initiation of qualifying proceedings and only of property belonging to a taxable person or a person covered by Section 122(1-A), upon an opinion founded on tangible material that attachment is necessary, and not merely expedient, to protect Government revenue. Given the drastic nature of the power, a live nexus between the material and the necessity for attachment, together with proportionality, is required. The attachment orders disclosed only vague suspicions concerning third-party money-laundering and online-gaming activities, without identifying any GST liability of the payment aggregator, specific transactions, entities, manner of evasion, or material establishing that it was a taxable person or a person covered by Section 122(1-A). Reasons absent from the attachment orders could not be supplied through an affidavit. The escrow balances represented merchant settlement monies impressed with a trust and did not constitute the payment aggregator's property for attachment.

Conclusion: The provisional attachment orders, including the continuing restrictions retained through the partial de-freezing orders, lacked the statutory basis required under Section 83 and were set aside.

Issues: Whether the appeal should be admitted for regular hearing despite delay, and whether recovery of the balance demand is deemed stayed upon payment of the stipulated pre-deposit.

Analysis: The explanation for delay was found prima facie bona fide. The record confirmed payment of 20% of the stipulated pre-deposit; consequently, the statutory consequence under Section 112(9) applied, deeming recovery proceedings for the balance amount stayed pending dismissal of the appeal.

Outcome: The appeal was admitted for regular hearing, and the respondents were directed to comply with the statutory stay of recovery. The merits remain pending adjudication.

Issues: (i) Whether input tax credit can be denied to a purchasing taxpayer possessing valid transaction and transport documents and banking-payment proof merely because the supplier was subsequently found non-existent? (ii) Whether penalty proceedings for wrongful availment of input tax credit can be sustained without proof of the purchaser's collusion or active participation in fraud?

Issue (i): Whether input tax credit can be denied to a purchasing taxpayer possessing valid transaction and transport documents and banking-payment proof merely because the supplier was subsequently found non-existent?

Analysis: The conditions for input tax credit required proof of a valid invoice and actual receipt of goods. The purchaser produced the tax invoice, e-way bill, consignment note and verifiable banking payments, while consumption of the raw material in manufacturing finished goods remained undisputed. The supplier was registered with a valid GSTIN when the transaction occurred. A subsequent finding that the supplier was non-existent or retrospective cancellation of its registration did not, by itself, displace the evidence of actual receipt or the purchaser's bona fides.

Conclusion: Input tax credit could not be denied to the purchaser solely because the supplier was subsequently found non-existent; this issue was decided in favour of the assessee.

Issue (ii): Whether penalty proceedings for wrongful availment of input tax credit can be sustained without proof of the purchaser's collusion or active participation in fraud?

Analysis: Fraud, wilful misstatement, suppression or collusion was required for invocation of the penalty provision. Although the claimant initially bore the burden of proving eligibility for credit, that burden was discharged through documentary evidence of the purchase, transport, payment and consumption of inputs. No direct material established that the purchaser knew of, participated in, or colluded with any fraudulent invoicing arrangement of the supplier.

Conclusion: Penalty proceedings could not be sustained without evidence of the purchaser's fraud, collusion or active complicity; this issue was decided in favour of the assessee.

Final Conclusion: The reversal of input tax credit and consequential tax, interest and penalty demand were unsustainable, and the relief granted in first appeal remained operative.

Ratio Decidendi: A bona fide purchaser that establishes actual receipt of goods and payment through reliable contemporaneous documentation cannot be denied input tax credit or subjected to fraud-based penalty merely because the supplier is later found non-existent, absent proof of the purchaser's collusion or complicity.

Issues: Whether appeals pending before multiple State Benches and involving an identical question of law fall within the exclusive jurisdiction of the Principal Bench.

Analysis: Section 109(5) of the Central Goods and Services Tax Act, 2017 authorises notification of classes of cases to be heard only by the Principal Bench. Notification No. S.O. 4219(E) dated 17.09.2025 covers cases pending before two or more State Benches where the President is satisfied that an identical question of law is involved. Such notified cases are outside the jurisdiction of the State Benches. The recorded satisfaction was that the appeals raised the same legal question concerning input tax credit eligibility in relation to telecom towers.

Conclusion: The appeals fall within the notified class and are required to be heard exclusively by the Principal Bench.

Issues: (i) Whether an e-way bill was mandatory for an intra-city stock transfer of goods exceeding the prescribed consignment value; (ii) Whether an internal transfer between the assessee's own godown and showroom constituted a taxable supply so as to sustain penalty under Section 129; (iii) Whether the absence of an e-way bill established deliberate intent to evade tax or clandestine removal warranting penalty under Section 129.

Issue (i): Whether an e-way bill was mandatory for an intra-city stock transfer of goods exceeding the prescribed consignment value.

Analysis: Rule 138 applies to movement of goods exceeding the prescribed value even where the movement is for reasons other than supply. A consignor using its own conveyance must generate the e-way bill and the person in charge must carry it along with the underlying document. Although a delivery challan may be issued for movement otherwise than by way of supply under Rule 55, it does not displace the e-way bill requirement. The limited distance-based relaxations concern conveyance details or weighbridge movements and do not exempt generation of the e-way bill for the transfer in question.

Conclusion: An e-way bill was mandatory for the stock transfer; carrying a delivery challan alone constituted a technical procedural breach. This finding is against the assessee.

Issue (ii): Whether an internal transfer between the assessee's own godown and showroom constituted a taxable supply so as to sustain penalty under Section 129.

Analysis: The movement was an undisputed transfer of tax-paid vehicles between the assessee's own premises, involving neither a second person nor consideration. It was therefore not a supply under Section 7 and did not attract the charging provision in Section 9. Since no tax was payable on the goods at the stage of this internal stock transfer, the penalty mechanism under Section 129, quantified by reference to tax payable, could not be invoked.

Conclusion: The internal stock transfer was not a taxable supply and did not attract penalty under Section 129. This finding is in favour of the assessee.

Issue (iii): Whether the absence of an e-way bill established deliberate intent to evade tax or clandestine removal warranting penalty under Section 129.

Analysis: The vehicles were identifiable by engine and chassis numbers and could not practically be sold without statutory registration, insurance and supporting documentation. They had already been purchased against tax-paid invoices and remained fully traceable. The failure to generate an e-way bill resulted from a bona fide misunderstanding of the distance-related provisions, not an attempt to conceal a taxable transaction. The absence of tax liability in a stock transfer also afforded no basis to infer tax evasion or clandestine removal.

Conclusion: No mens rea, deliberate intent to evade tax, or clandestine removal was established; the Section 129 penalty was consequently unsustainable. This finding is in favour of the assessee.

Final Conclusion: The continuing obligation to generate an e-way bill for stock transfers does not justify a Section 129 penalty where the movement is not a taxable supply, no tax is payable, and no intent to evade tax is proved.

Ratio Decidendi: A technical failure to carry an e-way bill during an internal stock transfer cannot sustain a Section 129 penalty where the transfer is not a taxable supply, no tax is payable, and the facts disclose no intent to evade tax.