Issues: (i) Whether service tax under reverse charge was payable on foreign services in respect of which deductions were claimed under Rules 4, 9 and 10 of the Place of Provision of Services Rules, 2012; (ii) Whether demurrage charges paid for delay in loading or discharge of cargo constituted consideration for a taxable service.

Issue (i): Whether service tax under reverse charge was payable on foreign services in respect of which deductions were claimed under Rules 4, 9 and 10 of the Place of Provision of Services Rules, 2012.

Analysis: The show-cause notice applied the default Rule 3 without specifying why the assessee's disclosed claims under Rules 4, 9 and 10 were unavailable. As the demand arose from ST-3 returns and audit records already available to Revenue, and the assessee had furnished supporting documents, the extended period could not be invoked. The burden to establish taxability and inapplicability of the claimed place-of-provision rules remained on Revenue. The adjudicating authority had separately considered the fifteen categories of services and correctly accepted the deductions under Rules 4, 9 and 10.

Conclusion: The dropped service-tax demand of Rs. 143,01,41,936 was rightly dropped; the issue is decided in favour of the assessee.

Issue (ii): Whether demurrage charges paid for delay in loading or discharge of cargo constituted consideration for a taxable service.

Analysis: Demurrage was payable as a penal charge for delay and not as consideration for services received. Such charges are in the nature of liquidated damages or penal rent and are outside the service-tax levy.

Conclusion: Demurrage charges were not taxable, and the service-tax demand of Rs. 1,26,16,689 together with penalty was unsustainable; the issue is decided in favour of the assessee.

Final Conclusion: No service-tax liability survives under the impugned show-cause notice.

Ratio Decidendi: A reverse-charge demand cannot be sustained where the show-cause notice does not establish the inapplicability of the specific place-of-provision rules invoked by the assessee, and penal demurrage is not consideration for a taxable service.

Issues: (i) Whether the 23% licence and facility charges received from the kitchen operator under a revenue-sharing arrangement were consideration for Business Support Service; and (ii) whether payouts linked to sales of alcoholic beverages constituted consideration for Advertisement Service.

Issue (i): Whether the 23% licence and facility charges received from the kitchen operator under a revenue-sharing arrangement were consideration for Business Support Service.

Analysis: Section 65(104c) of the Finance Act, 1994 covers infrastructural support provided to support the business or commerce of a service recipient. The agreement provided for the appellant to receive 23% of the kitchen operator's net turnover, while both entities jointly operated the restaurant on a principal-to-principal basis. Circular No. 109/3/2009-S.T. recognises that, in a revenue-sharing arrangement between principal-to-principal parties, neither party renders a taxable service to the other merely because a predetermined share of revenue is received.

Conclusion: The licence and facility charges were a revenue share and not consideration for Business Support Service; the service-tax demand on this count was unsustainable, in favour of the assessee.

Issue (ii): Whether payouts linked to sales of alcoholic beverages constituted consideration for Advertisement Service.

Analysis: The payouts comprised stock and cash incentives received from distributors based on the volume of alcoholic beverages sold under specific agreements. The receipts were linked to sales of goods and did not represent consideration for sale of space or time, or for advertising or promoting alcoholic beverages.

Conclusion: The payouts were sales incentives and not consideration for Advertisement Service; the service-tax demand on this count was unsustainable, in favour of the assessee.

Final Conclusion: As neither receipt constituted consideration for a taxable service, the associated interest and penalties could not survive.

Ratio Decidendi: A genuine principal-to-principal revenue-sharing arrangement, without provision of support to a service recipient, does not create taxable Business Support Service; sales-linked incentives not paid for advertising activity are not taxable consideration for Advertisement Service.

Issues: (i) Whether compulsory generation and carriage of an e-way bill under Rule 138 applied to inter-State movement on 24 November 2017; (ii) Whether detention, seizure and penalty for non-production of an e-way bill were sustainable on that date.

Issue (i): Whether compulsory generation and carriage of an e-way bill under Rule 138 applied to inter-State movement on 24 November 2017.

Analysis: Rule 138 was substituted by Notification No. 27/2017-Central Tax dated 30.08.2017, but its compulsory operational date for e-way bill compliance was subsequently notified. The nationwide mandatory requirement was brought into force from 1 April 2018, which was after the interception on 24 November 2017.

Conclusion: No; compulsory e-way bill compliance under Rule 138 did not apply on 24 November 2017. The issue was decided in favour of the assessee and against the Revenue.

Issue (ii): Whether detention, seizure and penalty for non-production of an e-way bill were sustainable on that date.

Analysis: The goods corresponded with the tax invoice and transport documents, and no discrepancy was found in their quantity, weight or description. The buyer and seller were bona fide dealers, the vehicle was on its designated route, and no material established tax evasion or an intention to evade tax. Since the mandatory e-way bill requirement was not in force on the relevant date, proceedings under Sections 129 and 122 could not rest on its non-production.

Conclusion: No; detention, seizure and penalty for non-production of an e-way bill on that date were unsustainable. The issue was decided in favour of the assessee and against the Revenue.

Final Conclusion: Non-production of an e-way bill before Rule 138 became compulsory could not constitute a breach supporting detention or penal action where the accompanying transaction documents were genuine and no tax-evasion intent was shown.

Ratio Decidendi: Detention and penalty for failure to carry an e-way bill cannot be sustained where the compulsory requirement under Rule 138 had not come into force on the date of movement and no tax evasion is established.

Issues: Whether penalty for transport of goods with an expired e-way bill containing details of a vehicle wholly different from the vehicle actually carrying the goods was sustainable.

Analysis: Section 68 requires prescribed documents to accompany goods in transit, while Explanation (2) to Rule 138(3) requires Part B of the e-way bill to contain correct vehicle particulars for a valid movement. The limited relaxation under Circular No. 64/38/2018-GST applies to minor errors in one or two digits or characters and does not extend to substitution of an entirely different vehicle. An incomplete or incorrect e-way bill gives rise to a rebuttable presumption of intention to evade tax; such intention may be inferred from surrounding circumstances. Here, the e-way bill had expired, named a different vehicle, and the stated diversion and delay were unsupported by a timely explanation or credible material rebutting that presumption.

Conclusion: The penalty was validly imposed and the concurrent findings were sustained against the assessee.

Issues: (i) Whether the imported surgical tools were classifiable under CTH 9021 as orthopaedic appliances or under CTH 9018 as orthopaedic instruments; (ii) Whether the benefit of basic customs duty exemption under Item E(9) of List 30 was available for the period from 16.07.2018 to 12.12.2019; and (iii) Whether the concessional IGST benefit under Item E(9) of List 3 was available for the relevant period.

Issue (i): Whether the imported surgical tools were classifiable under CTH 9021 as orthopaedic appliances or under CTH 9018 as orthopaedic instruments.

Analysis: Chapter Note 6 to Chapter 90 confines orthopaedic appliances under Heading 9021 to appliances for preventing or correcting bodily deformities or for supporting or holding body parts following illness, operation or injury. The relevant goods were surgical tools used by surgeons and health-care professionals during operative procedures and were neither worn, carried or implanted in a patient. Heading 9018 specifically covers instruments and appliances used in medical and surgical sciences. The previous self-assessment of the same goods under Heading 9018 and the verified functional use of each imported item supported classification as surgical instruments.

Conclusion: The goods are classifiable under CTH 9018 and not under CTH 9021; the issue is against the assessee.

Issue (ii): Whether the benefit of basic customs duty exemption under Item E(9) of List 30 was available for the period from 16.07.2018 to 12.12.2019.

Analysis: For the stated period, Item E(9) of List 30 covered instruments and implants for severely physically handicapped patients, including spinal instruments. The imported goods were surgical tools specifically designed for spinal surgeries and therefore fell within the then applicable entry. The later amendment removing the word "instruments" did not govern the disputed pre-amendment period.

Conclusion: The basic customs duty exemption was available for the period from 16.07.2018 to 12.12.2019; the issue is against the Revenue.

Issue (iii): Whether the concessional IGST benefit under Item E(9) of List 3 was available for the relevant period.

Analysis: Item E(9) of List 3 under the IGST notification was identical to the corresponding pre-amendment customs exemption entry. Since the goods qualified under the customs entry for the earlier period, the identical IGST entry also applied. Unlike the customs notification, Item E(9) of List 3 was not amended to remove instruments, and its benefit consequently continued during the relevant period.

Conclusion: The concessional IGST benefit under Item E(9) of List 3 remained available; the issue is against the Revenue.

Final Conclusion: Surgical tools used in spinal procedures remain subject to classification as medical or surgical instruments, while the applicable pre-amendment customs exemption and the unamended corresponding IGST entry preserve the stated concessional benefits.

Issues: Whether specially designed disposable microcuvettes used with an analyser are classifiable as parts of analytical instruments under CTI 9027 9090 or as articles of plastic under CTI 3926 9099.

Analysis: Note 2(b) to Chapter 90 classifies parts and accessories suitable for sole or principal use with a particular instrument along with that instrument; permanent physical attachment is not required. The microcuvettes possessed specialised dimensions, configuration, material and optical characteristics necessary for calibration, spectrophotometry and accurate analytical operation of the analyser. Their function in processing samples and reagents, coupled with the absence of any established general or alternative use, demonstrated their sole or principal suitability for the analyser. Disposable character alone does not prevent an article from being a part or accessory, and classification depends on objective characteristics and functional use rather than material of manufacture.

Conclusion: The microcuvettes are parts of the analyser classifiable under CTI 9027 9090, and not articles of plastic under CTI 3926 9099.

Issues: (i) Entitlement to concessional basic customs duty under Notification No. 46/2011-Cus. for the disputed imports; (ii) Whether Notification No. 35/2013-Customs operates retrospectively; (iii) Validity of invoking the extended period of limitation.

Issue (i): Entitlement to concessional basic customs duty under Notification No. 46/2011-Cus. for the disputed imports

Analysis: On the dates of the disputed Bills of Entry, Notification No. 127/2011-Customs governed the exemption and did not cover goods under the relevant tariff heading. The subsequent Notification No. 64/2012-Customs also did not restore the omitted entry. No unequivocal governmental acknowledgment established that the omission was a drafting error. Strict construction of tax exemption notifications precluded extending the benefit beyond their expressed terms.

Conclusion: The concessional basic customs duty benefit was unavailable for the disputed imports; decided against the assessee.

Issue (ii): Whether Notification No. 35/2013-Customs operates retrospectively

Analysis: Notification No. 35/2013-Customs restored the benefit for the specified goods but did not prescribe retrospective operation. In fiscal matters, a notification operates prospectively unless retrospective intent is expressly stated or necessarily follows from its terms; an alleged omission cannot supply such intent.

Conclusion: Notification No. 35/2013-Customs operates prospectively from its Gazette publication; decided against the assessee.

Issue (iii): Validity of invoking the extended period of limitation

Analysis: The exemption claimed had ceased to be available before the Bills of Entry were filed. Awareness of the amended notification was attributable to the importer, and the claim of an unavailable benefit supported invocation of the extended period of limitation.

Conclusion: Invocation of the extended period of limitation was valid; decided against the assessee.

Final Conclusion: The claimed exemption was unavailable at the time of import, its later restoration did not affect prior imports, and the resulting duty demand was sustainable within the extended limitation period.

Ratio Decidendi: A fiscal exemption notification operates prospectively unless its text clearly provides otherwise, and a subsequent extension of exemption cannot confer benefits for an earlier period merely on an alleged omission.

Issues: (i) Whether penalties could be imposed and appropriated from refundable pre-deposit in refund proceedings after an appellate order had set aside the penalties; (ii) Whether interest on the refundable pre-deposit was governed by the pre-6 August 2014 version of Section 35FF of the Central Excise Act, 1944, and the point from which such interest was payable.

Issue (i): Whether penalties could be imposed and appropriated from refundable pre-deposit in refund proceedings after an appellate order had set aside the penalties.

Analysis: The prior appellate order had set aside the penalties. A refund claim for the pre-deposit had to be examined consistently with that binding disposition and could not be used to institute a fresh penalty determination or recover penalties by appropriation. Such reopening of penalty liability in refund proceedings was contrary to judicial discipline.

Conclusion: Penalties could not be imposed or appropriated in the refund proceedings; the issue is decided in favour of the assessee.

Issue (ii): Whether interest on the refundable pre-deposit was governed by the pre-6 August 2014 version of Section 35FF of the Central Excise Act, 1944, and the point from which such interest was payable.

Analysis: As the appeal was pending before 6 August 2014, the saving proviso to amended Section 35F, read with Section 83 of the Finance Act, 1994, preserved the pre-amendment Section 35FF regime despite the later date of deposit. Under that regime, statutory interest becomes payable only where the refundable amount remains unpaid beyond three months from receipt or communication of the appellate order by the jurisdictional authority, and not from the date of the pre-deposit. The dates on which the respective refundable components became due and the consequential interest require computation.

Conclusion: The pre-amendment Section 35FF governs; interest is not payable from the date of deposit but only after the stipulated three-month period. The assessee's claim for interest from the date of pre-deposit fails.

Final Conclusion: The refundable pre-deposit must be recalculated without the impermissible penalty appropriation, and statutory interest must be computed under the unamended regime for each amount that became refundable.

Issues: Whether the appellant was entitled to service-tax exemption for rent-a-cab service provided to an SEZ unit under Notification No. 4/2004 dated 31.03.2004.

Analysis: The Special Economic Zones Act exempts taxable services supplied to an SEZ Developer or Unit for authorised operations, and the situs of rendering the service does not defeat the exemption where the service is supplied for such operations. Form A-1 issued by the SEZ Specified Officer identified the appellant's rent-a-cab service as an authorised service. No documentary material rebutted that certification; transportation of SEZ staff by pick-up and drop was connected with the authorised service.

Conclusion: The appellant was entitled to the exemption, and denial of the exemption on the ground that the rent-a-cab service was rendered outside the SEZ area was unsustainable.

Issues: Whether the margin earned from the purchase and resale of airline cargo slots at specifically agreed rates is taxable as Business Auxiliary Service.

Analysis: Business Auxiliary Service requires consideration for services rendered to another. Commission received while acting as a general sales agent had already been subjected to service tax. Cargo slots covered by specific rate arrangements carried no commission entitlement; the assessee purchased and resold the slots independently, bearing the possibility of profit or loss. The unchanged factual and legal position warranted application of the earlier final orders on the same issue.

Conclusion: The resale margin arose from an independent, principal-to-principal trading of cargo space and was not consideration for Business Auxiliary Service; the service-tax demand was unsustainable, in favour of the assessee.

Issues: Whether the applicant should be granted regular bail in relation to allegations of cess and excise-duty evasion.

Analysis: A prima facie doubt was recorded regarding computation of suspected evasion solely from the recovery and seizure of machinery under the prescribed formula. The observation was confined to bail and did not determine the validity of the Rule or bind the trial court. In the absence of antecedents, and since the machinery had already been seized, an unsupported apprehension of repetition was insufficient to justify continued custody.

Outcome: Regular bail granted.

Issues: Whether revisionary jurisdiction under Section 263 of the Income-tax Act, 1961 was validly invoked to revisit the Assessing Officer's allowance of employee stock option expenditure under Section 37(1) of the Income-tax Act, 1961.

Analysis: Section 263 requires the assessment order to be both erroneous and prejudicial to the interests of the Revenue. The assessment record showed that the Assessing Officer had specifically raised the ESOP claim, obtained explanations and supporting material, and accepted the claim after verification. The absence of elaborate discussion in the assessment order did not establish a failure to make enquiry. The allowance of ESOP expenditure was a legally permissible view under Section 37(1), supported by High Court authority; admission of an SLP without any stay or reversal did not displace that position. Revisionary jurisdiction could not be exercised merely by substituting a different view for the view adopted after enquiry.

Conclusion: The exercise of revisionary jurisdiction under Section 263 was invalid; the twin statutory conditions were not satisfied and the assessment-order allowance of ESOP expenditure remained undisturbed.

Issues: Whether the assessee could be treated as an assessee in default under section 201(1) for not deducting tax at source on Leave Travel Concession payments while binding interim judicial directions were operative.

Analysis: The obligation to deduct tax at source under section 192 cannot operate independently of binding interim judicial directions. Where such directions precluded the relevant Leave Travel Concession payments from being treated as employee income for tax-deduction purposes, no enforceable obligation to deduct tax arose during their operation. Compliance with those directions therefore did not constitute a default under section 201(1).

Conclusion: The assessee could not be treated as an assessee in default under section 201(1) for non-deduction of tax on the impugned Leave Travel Concession payments, and the demand was liable to be deleted.

Issues: Whether penalty for accepting a cash loan from a spouse in contravention of the statutory restriction could be excused on the ground of family arrangement, repayment through banking channels, and reasonable cause.

Analysis: Section 269SS of the Income-tax Act, 1961 prohibits acceptance of specified loans or deposits in cash, while Section 271D prescribes penalty for its contravention; Section 273B permits relief only on establishing reasonable cause. The availability of banking facilities to both spouses, the earlier cheque loan from the husband, and the absence of any explanation for accepting the further amount in cash negated reasonable cause. A spousal or family arrangement did not displace the independent tax obligations of each assessee. Repayment of the loan by cheque was immaterial because the contravention occurs when the cash loan or deposit is accepted.

Conclusion: The cash loan from the spouse was not supported by reasonable cause, and the penalty imposed for contravention of Section 269SS was sustainable.

Issues: (i) Whether the cash deposits of Rs. 16,89,000, to the extent of Rs. 11,82,300, were unexplained money under section 69A despite the explanation of earlier bank withdrawals; (ii) Whether the addition could be sustained under section 68 solely on bank-account entries.

Issue (i): Whether the cash deposits of Rs. 16,89,000, to the extent of Rs. 11,82,300, were unexplained money under section 69A despite the explanation of earlier bank withdrawals.

Analysis: Under section 69A, the explanation of the nature and source of cash must be tested against the available material and the preponderance of probabilities. Verified bank withdrawals of Rs. 11,99,200 preceded the deposits, and the disputed amount was lower than those withdrawals. No withdrawal was shown to be non-genuine, no deposit preceded its asserted source, and no evidence established that the withdrawn cash had been otherwise spent or deployed. The unproved opening cash balance did not justify rejection of the particular disputed amount. Suspicion arising from retention of cash, frequency of withdrawals, or deposit during demonetisation could not substitute evidence of contrary utilisation. The fixed acceptance of 30% and rejection of 70% lacked a transaction-specific basis.

Conclusion: The cash-flow explanation was acceptable and the addition of Rs. 11,82,300 under section 69A was unsustainable, in favour of the assessee.

Issue (ii): Whether the addition could be sustained under section 68 solely on bank-account entries.

Analysis: Section 68 requires a sum credited in books of account maintained by the assessee. The assessment invoked section 69A, while the reference to section 68 was only alternative and conditional. A bank passbook is not, by itself, a book of account of the assessee, and no qualifying credit in books maintained by the assessee was identified.

Conclusion: The addition could not be sustained under section 68 merely on the basis of bank-account entries, in favour of the assessee.

Final Conclusion: The impugned addition and the consequential application of section 115BBE do not survive; tax and consequential interest are required to be recomputed in accordance with law.

Issues: Whether a rectification order under Section 154 issued in the name of an entity that had ceased to exist was valid.

Analysis: The entity had been dissolved before issuance of the notice and rectification order, and this fact had been communicated to the assessing authority. An order made against a non-existent entity suffers from substantive illegality, rather than a curable procedural defect under Section 292B of the Income-tax Act, 1961. Participation in the proceedings does not cure the defect, as there can be no estoppel against law.

Conclusion: The rectification order issued under Section 154 in the name of the non-existent entity was a nullity in law and was quashed.

Issues: (i) Whether share application money and share premium received from domestic and foreign subscribers for the assessment years 2007-08 and 2008-09 constituted unexplained cash credits under Section 68 of the Income-tax Act, 1961; (ii) Whether share application money refunded through banking channels within the same financial year could be added as unexplained cash credit under Section 68 of the Income-tax Act, 1961.

Issue (i): Whether share application money and share premium received from domestic and foreign subscribers for the assessment years 2007-08 and 2008-09 constituted unexplained cash credits under Section 68 of the Income-tax Act, 1961.

Analysis: The first proviso to Section 68, imposing an additional obligation on a closely held company to establish the source of source of share capital, share application money and share premium, was prospective from assessment year 2013-14 and did not apply to the relevant years. The applicable test required proof of identity, creditworthiness and genuineness. The subscribers were shown through PAN and ROC records, audited financial statements, banking trails, confirmations, share-allotment documents and physical verification; several directors also appeared and confirmed the investments. Earlier adverse statements had been retracted. Low returned income, alleged inadequacy of commercial wisdom in charging premium, or suspicion of accommodation entries could not displace the documentary evidence without independent corroboration connecting the credits with the assessee's undisclosed funds.

Conclusion: The relevant share application money and share premium were not unexplained cash credits under Section 68 of the Income-tax Act, 1961. The additions sustained for certain subscribers were deleted and the deletions concerning the remaining corporate subscribers were sustained, in favour of the assessee.

Issue (ii): Whether share application money refunded through banking channels within the same financial year could be added as unexplained cash credit under Section 68 of the Income-tax Act, 1961.

Analysis: The amounts received from nine subscribers were refunded through banking channels during the same financial year, no shares were allotted, and no balance remained outstanding at year-end. The record did not establish that the refunds were a device to introduce undisclosed money. The mere emergence of a credit entry during the year was insufficient where the surrounding evidence showed that the transaction had been genuinely squared up.

Conclusion: The refunded share application money was not liable to addition as unexplained cash credit under Section 68 of the Income-tax Act, 1961, in favour of the assessee.

Final Conclusion: For the years preceding the first proviso to Section 68, the documentary evidence and verification of the subscribers established the genuineness of the share-capital transactions, and no unexplained-credit addition survived.

Ratio Decidendi: For assessment years before the first proviso to Section 68 became operative, an assessee company that establishes the identity, creditworthiness and genuineness of share subscribers through reliable evidence cannot be subjected to an addition merely on suspicion regarding the subscribers' sources, absent corroboration that the funds represent its undisclosed income.

Issues: Whether penalty for furnishing inaccurate particulars of income was sustainable where the claim of replacement expenditure as revenue expenditure involved a debatable capital-versus-revenue issue.

Analysis: Section 271(1)(c) of the Income-tax Act, 1961 does not apply merely because a deduction claim is not accepted, where the particulars disclosed are neither inaccurate nor false. The characterisation of replacement expenditure as capital or revenue remained unsettled due to divergent judicial views and pending consideration of the identical question by the jurisdictional High Court. The assessee's claim was therefore bona fide and related to a debatable issue; disallowance of the claim did not establish conscious furnishing of inaccurate particulars.

Conclusion: The penalty under Section 271(1)(c) of the Income-tax Act, 1961 was not sustainable and was cancelled, in favour of the assessee.

Issues: Whether the addition for cash deposited during demonetisation under Section 115BBE was sustainable despite the explanation of its source through opening cash balance and current-year cash brokerage receipts.

Analysis: The accepted opening cash balance, together with cash brokerage earned before demonetisation and included in the returned income, demonstrated adequate availability of cash for the deposit. The addition was made merely by comparing the cash deposit with the opening balance while disregarding current-year income. The revenue authorities neither disproved the cash brokerage receipts as arising from undisclosed sources nor rejected the books of account or identified any contradiction in the cash-flow explanation. An addition based only on a mathematical difference and conjecture and surmise could not be sustained where the source of cash deposits stood explained.

Conclusion: The cash deposit was satisfactorily explained; consequently, the addition of Rs. 3,38,740 under Section 115BBE was deleted in favour of the assessee.

Issues: (i) Whether the Revenue could challenge the section 54F relief granted by the first appellate authority without an appeal, cross-objection, or Rule 27 application; (ii) Whether the assessee was entitled to section 54F deduction for Rs. 72,52,250 claimed as advances to contractors for construction of a residential house; (iii) Whether addition of Rs. 3,95,000 under section 56(2)(vii)(b)(ii) for purchase of a flat below stamp-duty value was sustainable; and (iv) Whether addition of Rs. 40,000 for alleged low household withdrawals could be sustained on estimation alone.

Issue (i): Whether the Revenue could challenge the section 54F relief granted by the first appellate authority without an appeal, cross-objection, or Rule 27 application.

Analysis: In the absence of a departmental appeal, cross-objection, or an application under Rule 27 of the Income-tax (Appellate Tribunal) Rules, 1963, appellate consideration was confined to the grounds raised by the assessee. The assessee could not be placed in a more disadvantageous position as a consequence of pursuing its own appeal.

Conclusion: The Revenue's challenge to the section 54F relief already granted was outside the scope of the appeal, in favour of the assessee.

Issue (ii): Whether the assessee was entitled to section 54F deduction for Rs. 72,52,250 claimed as advances to contractors for construction of a residential house.

Analysis: Section 54F of the Income-tax Act, 1961 requires an eligible investment towards purchase or construction of the new residential asset. The claimed advances were unsupported by formal contracts, particulars of work assigned, bills, valuation evidence, or material establishing commencement of construction within the prescribed period. Mere unsubstantiated advances did not establish investment in construction.

Conclusion: Disallowance of section 54F deduction for Rs. 72,52,250 was sustained, against the assessee.

Issue (iii): Whether addition of Rs. 3,95,000 under section 56(2)(vii)(b)(ii) for purchase of a flat below stamp-duty value was sustainable.

Analysis: The deeming provision in section 56(2)(vii)(b)(ii) of the Income-tax Act, 1961 applied where the purchase consideration was below the stamp-duty value. Acquisition of a flat in a multi-storeyed building included rights to use common amenities; the value attributable to facilities such as lifts could not be excluded from the property's value for determining the difference.

Conclusion: The addition of Rs. 3,95,000 under section 56(2)(vii)(b)(ii) was sustained, against the assessee.

Issue (iv): Whether addition of Rs. 40,000 for alleged low household withdrawals could be sustained on estimation alone.

Analysis: An addition for inadequate household withdrawals requires material showing that actual household expenditure exceeded the withdrawals disclosed. No evidence or scientific basis established insufficiency of the declared drawings; the addition rested solely on estimation and suspicion.

Conclusion: The addition of Rs. 40,000 for alleged low household withdrawals was deleted, in favour of the assessee.

Final Conclusion: The unsupported claim of construction advances and the deemed-income addition for purchase below stamp-duty value remain sustainable, whereas the addition founded solely on estimated household expenditure does not survive.