Issues: Whether the penalty for alleged abetment of gold smuggling was sustainable on the statements, electronic communications, and the alleged failure to act at airport screening.

Analysis: A statement recorded under Section 108 of the Customs Act, 1962 could be relied upon in adjudication only after compliance with the procedure under Section 138B, including examination of the maker, a determination of admissibility, and an effective opportunity of cross-examination, unless a statutory exception applied. Those safeguards were not followed for the appellant's statement or the material witness statements. The call records and WhatsApp chats also lacked the certification required for electronic evidence. The DFMD was faulty, the appellant was not assigned screening duties as a proper officer, and no independent corroborative evidence connected the appellant with possession, handling, or dealing with the smuggled gold.

Conclusion: The statements and electronic material could not validly sustain the allegation, and the penalty under Section 112(b) of the Customs Act, 1962 was unsustainable.

Issues: Whether a successful liquidation-auction bidder who failed to pay the balance sale consideration within the stipulated period was entitled to refund of the deposited amount despite an express forfeiture clause in the auction notice and the ceiling on earnest money deposit under Schedule I.

Analysis: Schedule I of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 limited the earnest money deposit to 10% of the reserve price but did not displace an express auction condition permitting forfeiture of the entire amount deposited upon a successful bidder's failure to pay the balance consideration. The bidder accepted the sale on an as-is-where-is basis, with prior disclosure of the title-related issue, and voluntarily deposited the stipulated amount comprising the earnest money deposit and part of the sale consideration. The asserted need for prior title deeds arose only near the payment deadline and could not justify non-payment. The triple test did not assist the bidder: repeated assurances did not establish financial capacity, and the proceedings initiated by another entity did not constitute an extraneous impediment preventing payment. The allegation of unequal treatment was raised belatedly and without supporting material.

Conclusion: The forfeiture of the entire deposited amount, including the earnest money deposit and part sale consideration, was valid, and no refund was due.

Issues: (i) Whether an OTS between a personal guarantor and the sole financial creditor can bring the corporate debtor out of liquidation; (ii) Whether forfeited earnest money deposit previously received by the financial creditor must revert to the liquidation estate after its debt is settled; (iii) Whether payment of remuneration to the erstwhile liquidator from the liquidation estate is valid; and (iv) Whether the admitted operational creditor is entitled to distribution and the personal guarantor can claim priority as a financial creditor.

Issue (i): Whether an OTS between a personal guarantor and the sole financial creditor can bring the corporate debtor out of liquidation.

Analysis: A bilateral settlement with a financial creditor does not displace the statutory liquidation process. Exit from liquidation is available only through the legally recognised routes, including a scheme under Section 230 of the Companies Act, 2013, or sale of the corporate debtor as a going concern. The separately ratified transfer of assets, treated as a private sale after unsuccessful auctions and on value-maximisation considerations, was left undisturbed.

Conclusion: The OTS did not terminate or alter the liquidation process, and no interference was warranted with the ratified asset transfer.

Issue (ii): Whether forfeited earnest money deposit previously received by the financial creditor must revert to the liquidation estate after its debt is settled.

Analysis: The forfeited earnest money deposit constituted an asset of the liquidation estate. Once the financial creditor accepted the OTS amount and issued an account-closure certificate, its claim stood satisfied and it retained no entitlement to the forfeited amount. The amount was consequently required to be restored to the liquidation estate for distribution under Section 53 of the Insolvency and Bankruptcy Code, 2016.

Conclusion: The forfeited earnest money deposit was required to be returned to the liquidation estate and could not be retained by the financial creditor.

Issue (iii): Whether payment of remuneration to the erstwhile liquidator from the liquidation estate is valid.

Analysis: The erstwhile liquidator had undertaken claim processing, conducted auctions, pursued applications, and represented the corporate debtor in connected proceedings. The monthly remuneration had been fixed during the insolvency process and continued during liquidation; the reduced amount allowed was supported by the unchallenged computation and work performed.

Conclusion: Payment of the approved remuneration to the erstwhile liquidator from the liquidation estate was valid.

Issue (iv): Whether the admitted operational creditor is entitled to distribution and the personal guarantor can claim priority as a financial creditor.

Analysis: The operational creditor's claim had been lodged during the insolvency process, updated after liquidation commenced, admitted by the liquidator, and reported to the relevant authorities. Payment by the personal guarantor to settle the financial creditor's dues did not effect an assignment of debt or substitute the guarantor as a financial creditor. As purchaser of assets or promoter, the guarantor had no priority claim over the liquidation estate and could receive any surplus only after statutory claims were satisfied under Section 53 of the Insolvency and Bankruptcy Code, 2016.

Conclusion: The admitted operational creditor was entitled to distribution under the statutory waterfall, and the personal guarantor had no priority entitlement as a financial creditor.

Final Conclusion: The liquidation estate, including forfeited earnest money deposit, remains available for settlement of liquidation costs and admitted stakeholder claims in accordance with the statutory waterfall.

Ratio Decidendi: A personal guarantor who settles the corporate debtor's financial debt under an OTS does not, absent assignment or substitution, become a financial creditor entitled to liquidation-estate proceeds, which must be distributed under the statutory waterfall after the financial creditor's claim is satisfied.

Issues: Whether the extended period of limitation for recovery of service tax could be invoked for the period 2015-16.

Analysis: Section 73 of the Finance Act, 1994 permits invocation of the extended limitation period only where suppression, wilful misstatement, fraud or like conduct is established. The relevant receipts and taxable transactions had been disclosed through VAT returns and ST-3 returns, and the original adjudicating authority had evaluated those records while dropping the proposed demand. The material did not establish suppression of facts, wilful misstatement or fraud. Therefore, any demand could only fall within the normal limitation period. The show cause notice dated 24.12.2020 for the period 2015-16 was wholly time-barred.

Conclusion: The extended period of limitation was not invocable, and the service tax demand was barred by limitation.

Issues: (i) Whether the project-level anti-profiteering methodology, using purchase value to quantify additional input tax credit and allocating savings per square foot, complied with the remand directions; (ii) Whether unavailed pre-GST CENVAT credit on input services could be notionally set off against post-GST input tax credit; and (iii) Whether GST on the additional realisation and interest were validly included in the recoverable amount.

Issue (i): Whether the project-level anti-profiteering methodology, using purchase value to quantify additional input tax credit and allocating savings per square foot, complied with the remand directions.

Analysis: The governing methodology for real-estate projects rejects a comparison of input tax credit with turnover because construction expenditure, credit accrual and buyer collections do not have a direct correlation throughout a project. It requires the total GST-related saving for the project to be determined and allocated over the total project area to derive a uniform per square foot benefit. The revised computation quantified the additional input tax credit against project purchase value, determined the project-level saving, divided it by total area, and applied the resulting per square foot figure to the sold area. Purchase value was used to measure credit against project expenditure, not as a substitute for turnover or for allocating benefit according to buyer collections. Judicial review under Articles 226 and 227 does not permit replacement of a fair and reasonable factual computation accepted by the specialised Tribunal absent jurisdictional error, manifest illegality or non-compliance with the binding remand directions.

Conclusion: The methodology was consistent with the remand directions and was validly sustained, against the assessee.

Issue (ii): Whether unavailed pre-GST CENVAT credit on input services could be notionally set off against post-GST input tax credit.

Analysis: Section 171 of the Central Goods and Services Tax Act, 2017 concerns the benefit of input tax credit actually accruing to the supplier and its passing on to recipients. The pre-GST returns recorded nil CENVAT credit actually availed, while substantial GST input tax credit was availed after GST. A credit that was only legally available but remained unclaimed cannot be treated as having reduced the pre-GST tax incidence, since that would compare actual post-GST benefit with a hypothetical pre-GST benefit. The benefit was not restricted to credit on goods, as the post-GST credit on input services was also actually availed.

Conclusion: Unavailed pre-GST CENVAT credit could not be notionally set off against the post-GST input tax credit; the determination based on actual availment was upheld, against the assessee.

Issue (iii): Whether GST on the additional realisation and interest were validly included in the recoverable amount.

Analysis: GST collected on the enhanced consideration resulting from non-passing of the tax benefit forms part of the profiteered amount because it represents tax collected on the additional realisation. The direction to pay interest at 18% was part of the statutory anti-profiteering consequence, and no independent jurisdictional infirmity was established.

Conclusion: Addition of GST at 12% to the profiteered amount and the direction for interest at 18% were valid, against the assessee.

Final Conclusion: The project-specific calculation founded on actually availed incremental input tax credit, allocated on a per square foot basis and inclusive of GST collected on the excess realisation, remains enforceable with interest payable to the affected recipients.

Ratio Decidendi: In real-estate anti-profiteering proceedings, incremental input tax credit actually availed after GST must be determined as project-level savings and allocated by area; unavailed pre-GST credit cannot be imputed as a notional offset.

Issues: Whether imposition of tax and penalty under Section 129 of the Central Goods and Services Tax Act, 2017 was justified where the e-way bills had expired and their validity was not extended under Rule 138 of the Central Goods and Services Tax Rules, 2017.

Analysis: Section 129 permits demand of tax and penalty for contraventions during transportation, while Rule 138(10) prescribes the validity period of an e-way bill. Circular No. 64/38/2018-GST distinguishes serious and substantive contraventions from minor or procedural lapses. The consignment was accompanied by invoices, lorry receipt, e-way bills and a test certificate; the invoices charged integrated tax and physical verification disclosed no discrepancy in the goods. Expiry of the e-way bills was the sole defect, and no tax evasion or intention to evade tax was established. The explanation for the incorrect destination entry and consequential validity period was relevant while deciding whether Section 129 could be invoked.

Conclusion: Invocation of Section 129 of the Central Goods and Services Tax Act, 2017 for the expired e-way bills was invalid and unjustified; the levy of integrated tax and penalty was set aside.

Issues: Whether statutory interest consequential to confiscation and redemption of imported goods may be computed from the original assessment of the Bill of Entry when the liability arising from the confiscation proceedings was determined only by a subsequent adjudication order.

Analysis: Under Section 125(2) of the Customs Act, 1962, the obligation to pay duty and charges consequent upon redemption arises in the context of exercise and acceptance of the redemption option. The resulting duty liability is required to be assessed and determined through the machinery of Section 28 of the Customs Act, 1962, after which statutory interest may apply in accordance with law. The original assessment was based on the declared description of the goods, whereas the goods were seized and the description, classification, confiscation consequences, redemption fine, penalties and duty consequences were determined only through the adjudication order dated 28.02.2023. Delay in adjudication does not by itself extinguish statutory interest; however, a liability that had not yet been determined cannot be treated as an amount in delayed payment for the preceding period.

Conclusion: Interest could not be computed for the period from the original assessment in May 2015 until 28.02.2023. The interest liability must be recomputed from the date of determination under the adjudication order, after accounting for the subsequent reassessment and payments or appropriations already made; interest for the subsequent period remains payable if attracted under the applicable law.

Issues: Whether penalty upon a director under Section 112(a) of the Customs Act, 1962 was sustainable where the imported goods were not available for confiscation or imposition of redemption fine, and the duty demand against the importer arising from the same order had already been set aside.

Analysis: Penalty under Section 112(a) requires an act or omission rendering goods liable to confiscation under Section 111. Although the adjudication order recorded that the goods were liable to confiscation under Section 111(m), no redemption fine under Section 125 was imposed because the goods were not physically available. The duty demand and penalties against the importer, founded on the same reclassification, had also been set aside in the importer's appeal. These circumstances left no legal basis for fastening penal liability upon the director.

Conclusion: The penalty imposed upon the appellant under Section 112(a) of the Customs Act, 1962 was unsustainable.

Issues: (i) Whether AED (GSI) credit paid on unprocessed nylon tyre cord fabric could be availed and utilised towards basic excise duty where the intermediate TCWS was exempt from AED (GSI) and tyres were not chargeable to AED (GSI); (ii) Whether refund of AED (GSI) credit was available for inputs used in exported tyres.

Issue (i): Whether AED (GSI) credit paid on unprocessed nylon tyre cord fabric could be availed and utilised towards basic excise duty where the intermediate TCWS was exempt from AED (GSI) and tyres were not chargeable to AED (GSI).

Analysis: Rule 57C of the Central Excise Rules, 1944 denied credit on inputs used in manufacture of exempt or nil-rated final products. The second proviso to Notification No. 5/94-C.E. (N.T.) dated 01.03.1994 confined AED (GSI) credit to payment of excise duty leviable under the Additional Duties of Excise (Goods of Special Importance) Act, 1957, on final products. TCWS was exempt from AED (GSI), while tyres were not chargeable to AED (GSI); consequently, no dutiable final product under that enactment existed against which the credit could be utilised. The subsequent CENVAT amendment and circular could not apply to the 1998-99 period. The retrospective amendment under Section 88 of the Finance Act, 2004 applied only to AED (GSI) paid on or after 1 April 2000.

Conclusion: The assessee was not eligible to avail or utilise AED (GSI) credit towards basic excise duty. The issue is decided against the assessee.

Issue (ii): Whether refund of AED (GSI) credit was available for inputs used in exported tyres.

Analysis: Refund under Rule 57F(13) depended upon valid entitlement to the underlying AED (GSI) credit. Since the credit itself was unavailable under Rule 57C and Notification No. 5/94-C.E. (N.T.) dated 01.03.1994, export of the tyres did not create entitlement to refund of that credit.

Conclusion: The assessee was not entitled to refund of the disputed AED (GSI) credit. The issue is decided against the assessee.

Final Conclusion: AED (GSI) credit under the MODVAT regime could be used only against liability under the same additional-excise-duty enactment; later CENVAT provisions did not alter the position for the earlier disputed period.

Ratio Decidendi: Credit of a specified additional excise duty is unavailable where no final product is liable to that duty, and cannot be diverted towards payment of a different excise duty unless the governing credit scheme expressly permits it.

Issues: Whether the ex parte GST demand and the appellate order could stand where there was no material establishing service of the show-cause notice upon the registered person.

Analysis: A notice under Section 73(1) of the Central Goods and Services Tax Act, 2017 read with Rule 142(1)(a) of the Central Goods and Services Tax Rules, 2017 must be served in a manner recognised by Section 169 of the Act. The record contained no material showing service of the show-cause notice through the GST portal, registered post, or e-mail. The demand was consequently confirmed without allowing the registered person to submit objections or be heard, contrary to the principles of natural justice.

Conclusion: The ex parte adjudication and the consequential appellate order could not be sustained. The registered person was entitled to receive the show-cause notice, file objections, and obtain fresh adjudication after an opportunity of hearing.

Issues: (i) Whether the sanction under Section 151 for reopening assessment was valid; (ii) Whether a recorded loan/advance received through banking channels could be assessed as unexplained investment under Section 69 and sustained under Section 68 without enquiry into the creditor's creditworthiness.

Issue (i): Whether the sanction under Section 151 for reopening assessment was valid.

Analysis: The assessee had not filed a return of income and the approval recorded satisfaction on the basis of available information and material indicating escaped income. The cited decisions concerned assessees that had filed returns and undergone assessment and were factually distinguishable. The recorded satisfaction reflected application of mind and did not establish mechanical approval.

Conclusion: The sanction for reopening was valid, against the assessee.

Issue (ii): Whether a recorded loan/advance received through banking channels could be assessed as unexplained investment under Section 69 and sustained under Section 68 without enquiry into the creditor's creditworthiness.

Analysis: Section 69 concerns investments not recorded in the books of account. The impugned sum was a loan/advance recorded in the books and received through banking channels, supported by documentary material that was neither rejected with reasons nor rebutted by adverse evidence. No enquiry was made from the creditor before concluding that the creditor lacked creditworthiness; consequently, sustaining the addition under Section 68 could not cure the unsupported addition.

Conclusion: The addition was unsustainable and was directed to be deleted, in favour of the assessee.

Final Conclusion: The reopening remains valid, but no addition can be retained in respect of the recorded loan/advance.

Ratio Decidendi: A recorded loan or advance cannot be treated as unexplained investment under Section 69, and an adverse finding on the creditor's creditworthiness requires supporting enquiry or evidence.

Issues: Whether penalty for contravention of Section 269SS was sustainable where jewellery purchased from the disclosed income of a company was kept in the managing director's residence and locker for safe custody.

Analysis: The disclosed income belonged to the company, and the jewellery acquired from those funds was kept with the assessee, its managing director, for safe custody. This arrangement did not establish that the assessee had accepted a cash loan or deposit exceeding the statutory threshold. Treating the amount as a cash loan was founded on assumptions, presumptions and surmises rather than the established facts.

Conclusion: The penalty under Section 271D for alleged violation of Section 269SS was unsustainable and was directed to be deleted, in favour of the assessee.

Issues: (i) Whether the agricultural receipts claimed by the assessee could explain cash deposits beyond the net agricultural income; and (ii) Whether the balance of the cash deposits claimed as gifts was satisfactorily explained.

Issue (i): Whether the agricultural receipts claimed by the assessee could explain cash deposits beyond the net agricultural income.

Analysis: For purposes of the addition under Section 69A of the Income-tax Act, 1961, the agricultural source had to be supported by the financial records and represent net income available for deposit. The agricultural land holding reflected in the balance sheet did not support treating the entire claimed gross agricultural receipts of Rs. 9.75 lakh as available cash. After accounting for the declared agricultural expenses of Rs. 5.42 lakh, only net agricultural income of Rs. 4.33 lakh was available to explain the deposits.

Conclusion: Only the net agricultural income was accepted as an explained cash source; rejection of the excess claimed agricultural source was upheld, against the assessee.

Issue (ii): Whether the balance of the cash deposits claimed as gifts was satisfactorily explained.

Analysis: The claimed gifts lacked donor confirmations, identity proof, and material establishing the donors' relationship and financial capacity. The partial acceptance of 50% of the gifts on benefit of doubt was found justified, while the remaining claim was unsupported for purposes of explaining the cash deposits under Section 69A of the Income-tax Act, 1961.

Conclusion: The balance of the claimed gifts remained unexplained money, against the assessee.

Final Conclusion: The agricultural and gift sources were confined to the amounts already accepted, leaving the remaining cash-deposit addition undisturbed.

Ratio Decidendi: An explanation for cash deposits as agricultural income or gifts must be supported by reliable evidence; agricultural receipts are reckoned net of expenses, and gifts require proof of donor identity, relationship, and financial capacity.

Issues: Whether an order under section 201 passed in the name of an amalgamating company, after its cessation upon amalgamation and despite prior intimation to the Revenue, is valid.

Analysis: The amalgamating company had ceased to exist from the appointed date under the approved scheme of amalgamation. The Revenue had been informed of the amalgamation before initiation of the section 201 proceedings and again during those proceedings. Although a show-cause notice was issued to the amalgamated company, the final order was addressed to, recorded the TAN of, and was served upon the erstwhile entity. Mere reference to the amalgamated company in the body of the order did not cure the defect. The authorities relied upon by the first appellate authority were distinguishable because they concerned a curable notice defect or absence of timely intimation of amalgamation.

Conclusion: The order under section 201 passed in the name of the non-existent amalgamating entity was without jurisdiction, void ab initio, and quashed in favour of the assessee.

Issues: Whether, in the circumstances of ex parte reassessments and dismissal of the first appeals in limine for delayed filing, the assessee should be afforded a further opportunity to substantiate the transactions.

Analysis: The assessments were framed under Sections 147, 144 and 144B of the Income-tax Act, 1961 after non-compliance, while the first appellate authority dismissed the appeals without examining the additions on merits because of delay. The peculiar circumstances warranted a further opportunity in the interest of substantial justice for production of evidence concerning the impugned transactions.

Conclusion: The assessee is entitled to a further opportunity before the Assessing Officer to present its case and furnish supporting evidence; failure to comply permits assessment on the material available in accordance with law.

Issues: Whether statutory interest on refund under Section 244A of the Income-tax Act, 1961 was payable on refunds arising from belated returns processed after condonation of delay.

Analysis: The return originally filed beyond the statutory due date, without a valid condonation order, was invalid. The refunds arose from fresh returns filed pursuant to condonation under Section 119(2)(b) of the Income-tax Act, 1961. Clause (ii) of paragraph 6 of CBDT Circular No. 11/2024 dated 01.10.2024 provides that interest is not admissible on belated refund claims. That condition applies to belated refund claims generally and is not confined to supplementary refund claims.

Conclusion: The assessee was not entitled to interest under Section 244A of the Income-tax Act, 1961 on the refunds; the issue is decided in favour of the Revenue.

Issues: (i) Whether reassessment after a completed scrutiny assessment was invalid as a change of opinion where the alleged loan had been examined on the same material; (ii) Whether a Section 148 notice served on 1 April 2021, without following the procedure under Section 148A, could sustain reassessment.

Issue (i): Whether reassessment after a completed scrutiny assessment was invalid as a change of opinion where the alleged loan had been examined on the same material.

Analysis: Sections 147 and 148 permit reassessment but not a review founded merely on a change of opinion. The loan confirmation, bank statements and balance sheet had been furnished and scrutinised during the original assessment under Section 143(3), and no new tangible material was identified. The earlier deletion of the addition in proceedings under Section 153A for want of incriminating material did not itself prevent legally available remedial action, but could not cure the absence of fresh material for reopening.

Conclusion: The reopening was an impermissible change of opinion and was invalid, in favour of the assessee.

Issue (ii): Whether a Section 148 notice served on 1 April 2021, without following the procedure under Section 148A, could sustain reassessment.

Analysis: The e-filing record indicated that the notice, though dated 31 March 2021, was served on 1 April 2021. A notice issued on or after 1 April 2021 under the erstwhile procedure was required to be treated as a deemed show-cause notice under Section 148A(b), followed by supply of material, consideration of the response and an order under Section 148A(d) before issuance of a notice under Section 148. That mandatory process was not followed.

Conclusion: The notice and consequential reassessment were invalid for non-compliance with Section 148A, in favour of the assessee.

Final Conclusion: The reassessment notice and consequential reassessment order were quashed on the independent grounds of change of opinion and non-compliance with the mandatory Section 148A procedure.

Issues: Whether reassessment proceedings were valid where the notice initiating reassessment was issued by an Income-tax Officer contrary to the jurisdiction allocated under CBDT Instruction No. 1/2011.

Analysis: The Instruction allocated assessment jurisdiction over non-corporate assessees reporting income of Rs. 20 lakh or more in metropolitan cities to the Deputy Commissioner or Assistant Commissioner. The assessee's returned income exceeded that threshold, yet the reassessment notice and consequential assessment were issued and made by the Income-tax Officer. The applicable precedents establish that a reassessment notice must be issued by the officer vested with jurisdiction by the Board, and a breach of the jurisdictional instruction is not curable.

Conclusion: The reassessment proceedings and consequential assessments were invalid for want of jurisdiction and were quashed.

Issues: Whether delayed filing of Form 67 can bar foreign tax credit claimed under Sections 90 and 90A of the Income-tax Act, 1961.

Analysis: Rule 128(9) of the Income-tax Rules, 1962 prescribes the time for furnishing Form 67 but does not provide that a delay results in forfeiture of foreign tax credit. The filing requirement is a directory procedural requirement rather than a mandatory condition, and non-compliance with it cannot defeat the substantive entitlement to foreign tax credit.

Conclusion: Delayed filing of Form 67 does not by itself extinguish entitlement to foreign tax credit; the form must be admitted and the claim determined after verification in accordance with law.

Issues: Whether foreign tax credit under Section 90 could be denied solely because the return and Form No. 67 were filed belatedly.

Analysis: Section 90 of the Income-tax Act, 1961 provides substantive double-taxation relief, while Rule 128 of the Income-tax Rules, 1962 prescribes the procedure and documentation for foreign tax credit. The assessee was otherwise undisputedly entitled to the credit and had fulfilled the requirements concerning its quantum and supporting formalities. The filing requirement for Form No. 67 under Rule 128(9) was treated as directory and procedural; a delay in filing a return under Section 139(4) or Form No. 67 could not curtail the substantive entitlement under Section 90. As subordinate legislation, Rule 128 could not operate to defeat the statutory foreign tax credit claim.

Conclusion: Foreign tax credit cannot be denied merely on account of delayed filing of the return or Form No. 67 where the substantive entitlement and quantum of the credit are undisputed.