Issues: Whether cognizance of alleged offences for non-compliance with summons could be taken without proof that the summons had been duly served and received.

Analysis: Sections 206 and 208 of the Bharatiya Nyaya Sanhita, 2023 required a sustainable basis for alleging deliberate or wilful non-compliance with summons issued under Section 70 of the Central Goods and Services Tax Act, 2017. The available material contained only tracking records and did not establish due service or acknowledgment of the summons. Mere issuance of summons, without proof of service, could not establish deliberate disobedience or evasion, nor disclose a prima facie case for taking cognizance.

Conclusion: The refusal to take cognizance was sustained, as absence of proof of due service of summons precluded a prima facie allegation of wilful non-compliance.

Outcome: The application for condonation of delay and the Special Leave Petition were dismissed on the ground of delay, with questions of law left open.

Issues: Whether revisional proceedings under Section 263 of the Income-tax Act, 1961 could be continued and an order passed against a corporate debtor during the moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016.

Analysis: Admission of the corporate debtor into the corporate insolvency resolution process under Section 7 of the Insolvency and Bankruptcy Code, 2016 triggered the statutory moratorium. Section 14 prohibits institution or continuation of proceedings against the corporate debtor during that period, and Section 238 gives the Code overriding effect over inconsistent enactments. The jurisdictional precedent applied establishes that income-tax proceedings cannot be initiated or continued while the moratorium operates, though proceedings may be revived after its cessation if permissible in law.

Conclusion: The revisional order passed during the subsistence of the moratorium was unsustainable; the revisional proceedings may be revived and reframed after cessation of the moratorium in accordance with law.

Issues: (i) Whether the deletion of addition under Section 68 for share capital and share premium was justified; (ii) Whether the reassessment initiated under Sections 147 and 148 was valid.

Issue (i): Whether the deletion of addition under Section 68 for share capital and share premium was justified.

Analysis: The first proviso to Section 68 imposes the additional obligation to explain the source of the shareholder's funds only upon a company in which the public are not substantially interested. As the assessee was a listed public company, that additional source-of-source obligation did not apply; nevertheless, it remained required under the main provision to establish identity, creditworthiness and genuineness. The assessee furnished PAN and tax details, bank records, share application and allotment documents, demat records, shareholder responses and financial material. The shares were electronically credited to investors' demat accounts and were approved for listing. No specific defect in this evidence was identified, and no independent enquiry was conducted after the assessee discharged its initial onus.

Conclusion: The deletion of the Section 68 addition was justified, in favour of the assessee.

Issue (ii): Whether the reassessment initiated under Sections 147 and 148 was valid.

Analysis: The recorded reasons relied on the assessee's balance sheet already furnished with the original return and did not disclose any new or fresh tangible material. The alleged short-term capital loss did not result in any disallowance in the reassessment. The allegation concerning excessive share premium under Section 56(2)(viib) was inapplicable to the listed company, while the eventual Section 68 addition was founded on a distinct allegation concerning shareholder creditworthiness and not on the stated reasons for reopening.

Conclusion: The recorded reasons were invalid and the reassessment proceedings and reassessment order were quashed ab initio, in favour of the assessee.

Final Conclusion: The Section 68 addition cannot survive, and the reassessment founded on invalid recorded reasons has no legal effect.

Issues: Whether the Principal Commissioner of Income Tax (Central), Jodhpur had territorial and subject-matter jurisdiction to cancel the assessee's registration under sections 12AA(3) and 12AA(4).

Analysis: The power conferred on a Principal Commissioner or Commissioner to cancel charitable registration requires the particular authority to possess jurisdiction over the assessee under section 120 and the applicable jurisdictional orders or notifications. The exemption jurisdiction over persons in Gujarat claiming exemption under sections 11 and 12 was assigned to the Commissioner of Income Tax (Exemption), Ahmedabad. Notification No. 70/2014 permits a Central Commissioner to exercise functions in cases assigned under section 127 to Assessing Officers subordinate to that Commissioner; proof of such assignment is a foundational jurisdictional fact.

Analysis: Mere centralisation of assessment proceedings with a Central Circle does not automatically transfer the distinct jurisdiction concerning registration and cancellation. Despite the specific challenge, the Revenue produced no order under section 127, jurisdictional notification, or other instrument establishing assignment of the assessee's registration proceedings to an Assessing Officer subordinate to the concerned Principal Commissioner. The impugned order's recital of centralisation could not establish the terms, scope, or legal effect of an unproduced transfer order.

Conclusion: The jurisdiction of the Principal Commissioner of Income Tax (Central), Jodhpur to cancel the registration was not established; the cancellation order was without jurisdiction and was quashed, with restoration of the registration on its original terms.

Ratio Decidendi: A Central Commissioner may cancel charitable registration only upon demonstrable statutory and jurisdictional authority; centralisation of assessment proceedings, without proof of a valid jurisdictional assignment, does not confer independent cancellation jurisdiction.

Issues: (i) Whether the addition of share capital and securities premium claimed to have been received in assessment year 2006-07 could be rectified under section 154 for assessment year 2011-12; (ii) Whether the addition of Rs.40 lakh as share application money received during the relevant year was rectifiable under section 154.

Issue (i): Whether the addition of share capital and securities premium claimed to have been received in assessment year 2006-07 could be rectified under section 154 for assessment year 2011-12.

Analysis: Section 154 permits correction of an obvious and patent mistake, not resolution of a debatable issue through extended reasoning. The record for rectification is not confined to the assessment order and may extend to the assessee's records for other assessment years. If the share capital and securities premium were in fact received in assessment year 2006-07, their addition in assessment year 2011-12 would constitute an error capable of rectification after verification of the supporting material. The issue required factual verification of the material filed by the assessee and coordinated consideration with the pending appeal against the original assessment.

Conclusion: In favour of the assessee; the rectification claim concerning share capital and securities premium was restored for fresh adjudication after verification of the evidence.

Issue (ii): Whether the addition of Rs.40 lakh as share application money received during the relevant year was rectifiable under section 154.

Analysis: The amount was received during the relevant assessment year. Its addition under section 68 rested on the absence of satisfactory evidence of the creditor's identity, source of credit, and genuineness of the transaction. Determining those matters required appreciation of evidence and a long-drawn inquiry, rather than correction of a prima facie mistake apparent from the record.

Conclusion: Against the assessee; the addition of Rs.40 lakh was not rectifiable under section 154.

Final Conclusion: The rectification claim relating to share capital and securities premium requires fresh, coordinated determination on the evidentiary record, while the claim relating to the in-year share application money remains outside the scope of rectification.

Ratio Decidendi: For rectification, the relevant record may include the assessee's connected assessment records, and an addition made in an incorrect assessment year may be corrected if the error becomes apparent on verification of that record; an issue requiring substantive proof and appreciation of evidence cannot be rectified under section 154.

Issues: Whether a 30% ad hoc disallowance of commission expenditure was sustainable where the assessee furnished recipient-wise, PAN, TDS and payment details, but no specific commission payment was found to be non-genuine or non-business.

Analysis: Section 37(1) of the Income-tax Act, 1961 places the initial burden of establishing business expenditure on the assessee. That burden stood sufficiently discharged through documentary evidence comprising commission-recipient details, PAN particulars, TDS records, Form No. 26Q and payment details. The commission was integral to the referral-based business model, and the revenue authorities did not identify any particular recipient as non-existent or any identified payment as bogus, excessive or unrelated to business. The estimated benchmark of commission at 20% to 25% of turnover lacked comparable cases, market data or other cogent material. The commission ratio was also broadly consistent with the assessee's ratios in preceding years.

Conclusion: The 30% ad hoc disallowance of commission expenditure was unsustainable and the addition was deleted in favour of the assessee.

Issues: (i) Whether goodwill arising from excess liabilities assumed on acquisition of a going-concern business under a slump-sale business transfer agreement is an intangible asset eligible for depreciation; (ii) Whether tax deducted at source credit must be granted in the assessment year in which the corresponding income is assessable, notwithstanding its reflection in Form 26AS for another year.

Issue (i): Whether goodwill arising from excess liabilities assumed on acquisition of a going-concern business under a slump-sale business transfer agreement is an intangible asset eligible for depreciation.

Analysis: The excess liabilities assumed on acquisition of the going concern constituted economic consideration for the acquired bundle of business and commercial rights, including goodwill. The absence of separately stated monetary consideration or individual valuation of assets and liabilities in a slump-sale agreement does not render such goodwill a mere book entry. The precedent relied upon for disallowance had been set aside, while materially similar coordinate authority supported depreciation on goodwill generated through assumption of excess liabilities. The subsequent exclusion of goodwill from depreciable assets operates prospectively and does not apply to the assessment year involved.

Conclusion: In favour of the assessee: the goodwill is a depreciable intangible asset, and depreciation claimed thereon is allowable.

Issue (ii): Whether tax deducted at source credit must be granted in the assessment year in which the corresponding income is assessable, notwithstanding its reflection in Form 26AS for another year.

Analysis: TDS credit is to be granted for the assessment year in which the corresponding income is assessable, provided the assessee establishes that the income relating to the deduction was offered to tax in that year. Verification of the return, books of account and Form 26AS is required.

Conclusion: The TDS-credit claim is restored for factual verification, with credit to be granted for the relevant assessment year if the corresponding income is found to have been offered to tax therein.

Final Conclusion: The depreciation disallowance and the consequential book-profit adjustment cannot be sustained; the TDS-credit entitlement remains subject to verification of the assessment year in which the related income was assessed.

Ratio Decidendi: Assumption of excess liabilities in acquiring a going concern is valid consideration for the acquired goodwill and business or commercial rights, and such goodwill is eligible for depreciation for years preceding the prospective statutory exclusion of goodwill.

Issues: Whether reassessment proceedings initiated after three years from the end of the relevant assessment year were valid where approval under section 151(ii) was granted by the Principal Commissioner instead of the specified higher authority.

Analysis: For reassessment proceedings initiated after expiry of three years from the end of the relevant assessment year, section 151(ii) requires approval from the Principal Chief Commissioner, Principal Director General, Chief Commissioner or Director General, as applicable. The approval for the order under section 148A(d) and consequential notice under section 148 was granted by the Principal Commissioner, who was not the competent specified authority under section 151(ii). This non-compliance went to the root of the Assessing Officer's jurisdiction and was not a curable procedural irregularity.

Conclusion: The approval was invalid under section 151(ii); consequently, the order under section 148A(d), notice under section 148, reassessment proceedings and reassessment order were quashed in favour of the assessee.

Issues: Whether the addition based on the difference between the stamp-duty value and the consideration for purchase of immovable property was sustainable where the variation was within 10%.

Analysis: The variation between the stamp-duty value and the actual consideration was approximately 6.2% to 6.6%. The enhanced 10% tolerance band was treated as a curative and beneficial measure intended to relieve genuine purchasers from marginal bona fide valuation differences. Applying the coordinate-bench position that this curative relaxation operates retrospectively, the variation fell within the protected band notwithstanding the assessment year involved.

Conclusion: The addition under section 56(2)(vii)(b) was unsustainable and was directed to be deleted, in favour of the assessee.

Issues: (i) Whether the delay of 264 days in filing the appeal was liable to be condoned on account of the director's illness; (ii) Whether the benefit arising from acquisition of land for substantially less than its established value was taxable under Section 28(iv) of the Income-tax Act, 1961.

Issue (i): Whether the delay of 264 days in filing the appeal was liable to be condoned on account of the director's illness.

Analysis: The delay was supported by the director's affidavit and medical certificate evidencing prolonged treatment. The explanation was bona fide and remained unrebutted by the Revenue, constituting sufficient cause.

Conclusion: The delay was condoned and the appeal was admitted, in favour of the assessee.

Issue (ii): Whether the benefit arising from acquisition of land for substantially less than its established value was taxable under Section 28(iv) of the Income-tax Act, 1961.

Analysis: Section 28(iv) taxes the value of a non-monetary benefit or perquisite arising from business or profession. The material found during survey, corroborated by the seller's statement, established the land value at Rs.98,010,000, whereas the assessee acquired it for Rs.15,750,000. The resulting benefit was received in the form of land and was therefore non-monetary. The principle that Section 28(iv) does not cover monetary receipts was inapplicable. The addition represented a real business benefit rather than a notional valuation. Article 265 of the Constitution of India did not assist the assessee because the levy was authorised by Section 28(iv). The claimed increase in stock-in-trade cost was also unavailable, since deduction requires actual cost incurred and cannot be founded on the value of a taxable benefit.

Conclusion: The non-monetary benefit of Rs.82,260,000 from acquiring the land below its established value was taxable under Section 28(iv), against the assessee.

Final Conclusion: The addition for the business benefit derived from the below-value acquisition of land stands sustained.

Ratio Decidendi: A benefit received in kind in the course of business, including property acquired at a value materially below its established value, is taxable under Section 28(iv) of the Income-tax Act, 1961; its taxation cannot be neutralised by treating the value of that benefit as actual acquisition cost.

Issues: Whether the stamp-duty value on the date of registration could be adopted under section 56(2)(x) where the property-purchase agreement pre-dated that provision and consideration had been paid through banking channels.

Analysis: The provisos to section 56(2)(x) permit adoption of the date of agreement for stamp-duty valuation where the agreement date and registration date differ and consideration, wholly or partly, is paid through prescribed banking modes on or before the agreement date. The agreement was executed before section 56(2)(x) came into force, the sale deed recorded the agreed consideration and payments, and the prescribed payment condition stood satisfied. The later registration date could not independently justify substituting the guideline value for the agreed consideration.

Conclusion: The agreement date and agreed consideration governed the transaction for section 56(2)(x); the addition based on the guideline value at registration was deleted.

Issues: (i) Whether reassessment for escaped capital gains was valid; (ii) Whether the assessee was entitled to capital-gains exemption for investment in two flats.

Issue (i): Whether reassessment for escaped capital gains was valid.

Analysis: The assessee had not filed a return despite taxable income and did not dispute the sale of residential property or the resulting taxable capital gains. No material established that the information forming the basis for reopening was incorrect or that jurisdiction had been assumed mechanically.

Conclusion: Reassessment was valid, against the assessee.

Issue (ii): Whether the assessee was entitled to capital-gains exemption for investment in two flats.

Analysis: The construction agreements did not evidence the dates or amounts of instalments, and no proof established payment of construction cost by the assessee to the developer. The sale deeds recorded acquisition of incomplete flats for Rs. 4,99,000 each, without referring to the asserted construction agreements or prior payments. The unfinished flats were not shown to have been completed within three years from transfer of the original asset; consequently, the statutory condition for exemption was not met.

Conclusion: The claimed capital-gains exemption was rightly disallowed, against the assessee.

Final Conclusion: The reassessment and the disallowance of exemption for the claimed investment in the flats remain legally effective.

Ratio Decidendi: Capital-gains exemption for construction of a residential house requires reliable proof of qualifying investment and completion of construction within the prescribed period.

Issues: (i) Whether the assessee's books of account could be rejected under Section 145 on account of its use of the completed contract/project completion method and variation in flat-booking rates; (ii) Whether addition for alleged undisclosed receipts could be sustained by adopting a uniform base price for flats and treating extra-work payments as the assessee's receipts.

Issue (i): Whether the assessee's books of account could be rejected under Section 145 on account of its use of the completed contract/project completion method and variation in flat-booking rates.

Analysis: Section 145 permits rejection of accounts only where there is a reasonable and cogent basis to conclude that the accounts are incorrect, incomplete, or incapable of determining true income. The completed contract/project completion method was a recognized method consistently followed by the assessee, and the Revenue did not establish that the method itself was impermissible. The Assessing Officer did not compute income under the percentage completion method but estimated profit at 8% of receipts recorded in the books, without comparable cases, past history, project-specific profitability, or other cogent basis. Variation in agreement values for flats, without evidence of unrecorded sales, suppression of receipts, or other accounting defects, did not establish that the books were unreliable.

Conclusion: Rejection of the books of account under Section 145 was unsustainable and is decided in favour of the assessee.

Issue (ii): Whether addition for alleged undisclosed receipts could be sustained by adopting a uniform base price for flats and treating extra-work payments as the assessee's receipts.

Analysis: Adoption of a uniform base price was based on assumption rather than proof that the assessee had actually received the alleged differential consideration. Differences in flat prices could arise from commercial factors including booking timing, payment terms, location, specifications, and negotiations. Payments identified in purchaser inquiries related to separate extra-work agreements with a proprietorship concern; no material established that those sums were received by or belonged to the assessee-company. No purchaser admitted payment of on-money to the assessee, and no independent evidence connected the assessee with any alleged excess consideration.

Conclusion: The addition for alleged undisclosed receipts was unsupported by cogent evidence and is deleted in favour of the assessee.

Final Conclusion: The completed contract/project completion method and the recorded sale consideration were accepted in the absence of demonstrated accounting defects, suppression, or evidence of unaccounted receipts.

Ratio Decidendi: Rejection of books and addition for undisclosed consideration require cogent evidence of accounting unreliability or actual unaccounted receipts; mere preference for another revenue-recognition method, price variation, or estimated differential consideration is insufficient.

Issues: Whether disallowance of diminution in the value of investment in a wholly owned subsidiary under section 143(1)(a) could be rectified under section 154 where a binding jurisdictional High Court decision had allowed an analogous claim as business loss.

Analysis: The subsidiary investment was made to expand and strengthen the assessee's existing business operations. The binding jurisdictional precedent treated loss from investment in a wholly owned subsidiary made for business purposes as a business loss. An intimation under section 143(1)(a), after considering the assessee's response, entails a quasi-judicial function and cannot disregard binding jurisdictional precedent merely because the tax audit report described the expenditure as capital. Non-consideration of a jurisdictional High Court decision that was already pronounced when the intimation was issued constitutes a mistake apparent from the record. The claim was therefore not rendered debatable merely because its allowability had earlier required judicial consideration.

Conclusion: The rectification application was maintainable and merited acceptance; the disallowance of diminution in the value of investment in the wholly owned subsidiary was liable to be deleted.

Issues: Whether penalty for under-reporting of income consequent upon misreporting was sustainable where deductions were claimed in respect of interest and dividend income and the tax with interest was paid after scrutiny assessment and initiation of penalty proceedings.

Analysis: Section 270A(6) of the Income-tax Act, 1961 permits relief from penalty for under-reported income where a bona fide explanation is furnished. That relief is expressly unavailable under section 270A(8) where under-reporting results from misreporting under section 270A(9)(a). The claims under section 80P(2)(d) and section 80M were maintained through the assessment and penalty proceedings; payment of tax and interest occurred only during the appeal against the penalty order. Such payment was consequential to scrutiny assessment and penalty action, not a voluntary disclosure establishing a bona fide error.

Conclusion: The levy of penalty at 200% under section 270A for under-reporting consequent upon misreporting was valid and is against the assessee.

Issues: (i) Whether the delay in filing the appeal before the Commissioner (Appeals) was liable to be condoned; (ii) Whether the assessment and additions required fresh adjudication after affording the assessee an opportunity to substantiate the bank deposits.

Issue (i): Whether the delay in filing the appeal before the Commissioner (Appeals) was liable to be condoned.

Analysis: The assessee had filed a condonation application along with the appeal, supported by the tax professional's affidavit explaining that health issues had prevented attendance to assessment and appellate notices. The record also showed that the condonation petition had been filed despite the contrary observation in the appellate order. The explanation constituted sufficient cause, and substantial justice prevailed over technical delay.

Conclusion: The delay before the Commissioner (Appeals) ought to have been condoned, in favour of the assessee.

Issue (ii): Whether the assessment and additions required fresh adjudication after affording the assessee an opportunity to substantiate the bank deposits.

Analysis: The assessee asserted that the deposits represented receipts from the utensil-trading business and undertook to furnish supporting material. Since the assessment had been completed ex parte and the assessee had not received an effective opportunity to substantiate this claim, a fresh examination by the Assessing Officer was necessary in the interest of justice.

Conclusion: The impugned order was set aside and the matter was restored to the Assessing Officer for de novo adjudication, in favour of the assessee.

Final Conclusion: The assessee's claims concerning the bank deposits must be reconsidered afresh after an effective opportunity to furnish supporting evidence.

Ratio Decidendi: Where a delay is supported by sufficient cause and the taxpayer has not received an effective opportunity to substantiate material claims in an ex parte assessment, procedural delay should yield to substantial justice and fresh adjudication should be directed.

Issues: Whether the first appellate authority was justified in dismissing the appeal in limine for a 126-day delay without adjudicating the grounds on merits.

Analysis: The explanation attributing non-compliance and delayed filing to the authorised representative was unsupported by evidence, warranting costs. However, the appeal had been rejected solely on limitation without a merits determination. The assessment also proceeded on a presumptive application of the tax-deduction requirement to the entire purchases, without a finding that purchases from each relevant party exceeded the prescribed threshold. In the interests of justice, substantive adjudication after opportunity to produce evidence and consideration of the Assessing Officer's remand report was required.

Conclusion: The limitation-based dismissal is set aside and the first appellate authority must adjudicate the grounds on merits after granting opportunity, obtaining a remand report on additional evidence, and upon payment of the imposed costs.

Issues: Whether reassessment for Assessment Year 2017-18 was valid where the sanction for issuance of notice was granted by the Principal Commissioner under Section 151(i), although more than three years had elapsed and approval under Section 151(ii) was required.

Analysis: The substituted reassessment regime introduced by the Finance Act, 2021 applied because the notice was issued after 31.03.2021. After expiry of three years from the end of the relevant assessment year, Section 151(ii) required approval from the Principal Chief Commissioner, Principal Director General, Chief Commissioner, or Director General. The undisputed sanction from the Principal Commissioner was not from a statutorily specified authority under Section 151(ii), rendering the initiation jurisdictionally defective.

Conclusion: The sanction was invalid, and the notice under Section 148 and consequential reassessment proceedings were without jurisdiction.