Issues: Whether the IBBI (Liquidation Process) (Second Amendment) Regulations, 2025 applied to a liquidation by sale of the corporate debtor as a going concern where the liquidation order, recording the Committee of Creditors' decision for such sale, had been passed before the amendment came into force.

Analysis: The liquidation order under Section 33(2) of the Insolvency and Bankruptcy Code, 2016 had made liquidation effective from its date and had expressly recorded the recommendation under Regulation 39C of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 that the liquidator first explore a going-concern sale under Regulation 32(e) of the IBBI (Liquidation Process) Regulations, 2016. The auction was an implementation step in the liquidation already commenced, not a fresh liquidation process. Rights and obligations in liquidation are governed by the regulations prevailing on the liquidation commencement date; a later amendment without retrospective operation cannot alter the legal foundation of the pre-existing process.

Conclusion: The amendment notified on 14.10.2025 did not govern or invalidate the going-concern sale process that commenced with the liquidation order dated 10.10.2025. The impugned order was set aside, and the matter was remitted for consideration of reliefs and concessions in accordance with law.

Issues: (i) Whether transfer of development rights in land to a developer in exchange for a share of the built-up area constitutes a taxable service; (ii) Whether CENVAT credit of tax paid on works-contract and administrative services received from the developer is admissible; (iii) Whether the extended limitation period and penalties are invocable in relation to the inadmissible CENVAT credit.

Issue (i): Whether transfer of development rights in land to a developer in exchange for a share of the built-up area constitutes a taxable service.

Analysis: Development rights are benefits arising out of land and consequently constitute immovable property under Section 3(26) of the General Clauses Act, 1897. A transfer of such rights is a transaction in immovable property, not a provision of construction service or any other taxable service.

Conclusion: Transfer of development rights was not a taxable service; the service-tax demand and related penalties under Sections 77 and 78 of the Finance Act, 1994 are unsustainable, in favour of the assessee.

Issue (ii): Whether CENVAT credit of tax paid on works-contract and administrative services received from the developer is admissible.

Analysis: Since transfer of development rights was not an output service, the works-contract and administrative services received from the developer could not qualify as input services for that transaction.

Conclusion: CENVAT credit is inadmissible and recoverable under Rule 14 of the CENVAT Credit Rules, 2002, against the assessee.

Issue (iii): Whether the extended limitation period and penalties are invocable in relation to the inadmissible CENVAT credit.

Analysis: The credit was availed because the assessee bona fide treated transfer of development rights as taxable construction service and discharged service tax on that basis. This conduct did not warrant invocation of the extended limitation period or imposition of penalty.

Conclusion: Recovery of inadmissible credit is restricted to the normal limitation period, and the penalty under Rule 15 of the CENVAT Credit Rules, 2002 is set aside, in favour of the assessee.

Final Conclusion: The transfer of development rights is treated as a transaction in immovable property; service tax paid on it may be claimed as refund subject to the statutory bar of unjust enrichment, while inadmissible credit remains recoverable only within the normal period.

Ratio Decidendi: Transfer of development rights, being a benefit arising out of land and thus immovable property, is not a taxable service; services received for such transfer cannot generate input-service credit, though a bona fide contrary tax position precludes extended limitation and penalty.

Issues: (i) Whether the extended period of limitation could be invoked for the alleged short reversal of CENVAT credit; (ii) Whether proportionate reversal under Rule 6(3A) was to be computed with reference to total CENVAT credit or only common CENVAT credit; and (iii) Whether trading or services in the negative list could be treated as exempted services for Rule 6.

Issue (i): Whether the extended period of limitation could be invoked for the alleged short reversal of CENVAT credit.

Analysis: The reversals were disclosed in filed returns and the Revenue could have verified the computation by scrutiny or by seeking further information. Failure to undertake such verification does not establish deliberate concealment. Invocation of the extended period requires fraud, collusion, wilful misstatement, suppression of facts, or contravention with intent to evade; mens rea cannot be presumed from a bona fide interpretative position or an audit detection.

Conclusion: The extended period of limitation was not invocable, in favour of the assessee.

Issue (ii): Whether proportionate reversal under Rule 6(3A) was to be computed with reference to total CENVAT credit or only common CENVAT credit.

Analysis: Read harmoniously, Rule 6 permits proportionate reversal only of credit attributable to common inputs or input services used for taxable and exempted activities. Credit exclusively used for taxable output services or dutiable goods cannot be included in the reversal formula. The substitution of the Rule 6(3A) formula by Notification No. 13/2016-C.E. (N.T.) was clarificatory and consequently applied retrospectively.

Conclusion: Only common CENVAT credit was relevant for proportionate reversal; computation on total CENVAT credit was unsustainable, in favour of the assessee.

Issue (iii): Whether trading or services in the negative list could be treated as exempted services for Rule 6.

Analysis: Rule 2(e) does not classify services listed in Section 66D as exempted services. Transfer of title in goods through trading is excluded from the definition of service; it is a sale transaction subject to the distinct taxing field applicable to goods and cannot be deemed to be a service merely for the purpose of the negative list.

Conclusion: Trading is not a service and cannot be treated as an exempted service for Rule 6, in favour of the assessee.

Final Conclusion: The demand founded on the alleged short reversal of credit was legally unsustainable.

Issues: (i) Whether construction of residential flats by a builder before 01.07.2010 was taxable in the absence of the deeming provision; (ii) Whether construction of a building or independently identifiable project having twelve or fewer residential units was taxable as a residential complex service or works contract service; (iii) Whether consideration received under separate agreements with individual purchasers for completion of residential units intended for personal use was taxable; (iv) Whether a separate levy could be sustained on flats allotted to landowners under a development agreement; (v) Whether abatement and cum-tax valuation were available for any consideration otherwise found taxable; and (vi) Whether the extended limitation period and penalties were sustainable.

Issue (i): Whether construction of residential flats by a builder before 01.07.2010 was taxable in the absence of the deeming provision.

Analysis: The explanation deeming construction by a builder to be taxable where consideration was received from a prospective buyer before completion certification came into force only from 01.07.2010. That deeming fiction could not operate retrospectively for the earlier period.

Conclusion: The demand for the period before 01.07.2010 was unsustainable, in favour of the assessee.

Issue (ii): Whether construction of a building or independently identifiable project having twelve or fewer residential units was taxable as a residential complex service or works contract service.

Analysis: Although indivisible contracts involving goods and construction services are works contracts, taxability of residential construction still depends on satisfaction of the statutory definition of a residential complex. A project or independently identifiable building having twelve or fewer residential units does not meet that definition, and the works contract entry cannot enlarge it.

Conclusion: Construction of such buildings or projects was outside the taxable scope, in favour of the assessee.

Issue (iii): Whether consideration received under separate agreements with individual purchasers for completion of residential units intended for personal use was taxable.

Analysis: The statutory exclusion covered construction undertaken under individual agreements for residential units intended for the purchasers' personal use, including use by another person as a residence with or without rent. Separate agreements for completion and finishing of individual flats fell within that exclusion, absent material showing commercial exploitation or non-residential use.

Conclusion: Service tax on consideration under the individual purchaser agreements was not payable, in favour of the assessee.

Issue (iv): Whether a separate levy could be sustained on flats allotted to landowners under a development agreement.

Analysis: A further levy on the landowners' share would constitute double taxation where the value of land or development rights was embedded in the assessable value of the developer's share on which tax had been discharged. No evidence established that consideration received in kind from landowners had escaped tax despite such inclusion.

Conclusion: The separate demand on the landowners' share was unsustainable, in favour of the assessee.

Issue (v): Whether abatement and cum-tax valuation were available for any consideration otherwise found taxable.

Analysis: Any residual taxable consideration was entitled to statutory abatement on fulfilment of prescribed conditions. Where service tax had not been separately collected, the gross amount charged had to be treated as inclusive of service tax for valuation.

Conclusion: Applicable abatement and cum-tax benefit under Section 67(2) were required to be extended for any amount otherwise found taxable, in favour of the assessee.

Issue (vi): Whether the extended limitation period and penalties were sustainable.

Analysis: The dispute arose from interpretation of composite construction contracts, the subsequently introduced deeming provision, the personal-use exclusion, valuation, and taxability of the landowners' share. Divergent views and the absence of any identified fraud, collusion, or deliberate suppression with intent to evade precluded invocation of the extended period. The same interpretational circumstances did not support penalties.

Conclusion: The extended period was not invocable and all penalties were unsustainable, in favour of the assessee.

Final Conclusion: The disputed residential-construction levy was governed by the pre-2010 non-taxability, statutory residential-complex and personal-use exclusions, protection against double taxation, applicable valuation relief, and the normal limitation period.

Issues: (i) Whether the extended period of limitation under the proviso to Section 11A(1) of the Central Excise Act, 1944 was invocable in the absence of established deliberate suppression, where the Department had contemporaneous knowledge of the stock position and the demand rested on statutory records; (ii) Whether penalty under Section 11AC of the Central Excise Act, 1944 was imposable.

Issue (i): Whether the extended period of limitation under the proviso to Section 11A(1) of the Central Excise Act, 1944 was invocable in the absence of established deliberate suppression, where the Department had contemporaneous knowledge of the stock position and the demand rested on statutory records.

Analysis: The proviso requires the Revenue to establish that the non-levy or short-levy resulted from fraud, collusion, wilful misstatement, suppression of facts, or contravention with intent to evade duty. This jurisdictional enquiry is distinct from computation of the limitation period from the relevant date. Departmental knowledge cannot alter the statutory relevant date after the proviso is attracted, but contemporaneous knowledge is material evidence in deciding whether suppression existed at all.

Analysis: The stock verification was conducted in the presence of departmental officers after their invitation, and the demand was founded exclusively on the Cost Audit Report, a statutory record required to be maintained and producible to the Department. The prescribed returns did not require disclosure of the shortages or excesses. The notices neither identified a suppressed fact nor pleaded a breached disclosure obligation, deliberate concealment, or intent to evade duty. In the absence of a positive and deliberate act of withholding material information, mere non-reporting or discovery of a discrepancy cannot constitute suppression. The notices issued beyond the ordinary one-year period were therefore time-barred.

Conclusion: The extended period was not available; the demand was barred by limitation in its entirety, in favour of the assessee.

Issue (ii): Whether penalty under Section 11AC of the Central Excise Act, 1944 was imposable.

Analysis: Penalty under Section 11AC is conditional upon satisfaction of the ingredients that permit invocation of the proviso to Section 11A(1). Since no fraud, wilful suppression, or intent to evade duty was established, that condition failed.

Conclusion: Penalty under Section 11AC was not imposable, in favour of the assessee.

Final Conclusion: The extended-period duty demand and consequential interest and penalty liabilities could not be sustained; no finding was required on the merits of the underlying demand.

Ratio Decidendi: The extended limitation period under the proviso to Section 11A(1) is available only upon proof of deliberate suppression or other specified culpable conduct with intent to evade duty; departmental possession of statutory records and contemporaneous knowledge may demonstrate the absence of such suppression.

Issues: (i) Whether dolochar, fly ash, iron ore fines and other incidental waste materials arising during manufacture of sponge iron are liable to Central Excise duty merely because they are marketable and tariff-listed; (ii) Whether dolochar was alternatively covered by unconditional exemption notifications applicable to waste arising from manufacture of iron or steel; (iii) Whether the extended period of limitation, interest and penalties could be sustained.

Issue (i): Whether dolochar, fly ash, iron ore fines and other incidental waste materials arising during manufacture of sponge iron are liable to Central Excise duty merely because they are marketable and tariff-listed.

Analysis: Levy under Section 3 requires that goods be manufactured or produced. Marketability under the explanation to Section 2(d), sale value, or tariff coverage does not dispense with the independent requirement of manufacture. Dolochar and fly ash arose inevitably as residues from coal use, while iron ore fines arose from handling, screening or segregation; no independent process producing a new and distinct commodity with a separate name, character or use was established. The burden to establish manufacture remained unmet.

Conclusion: The disputed residues and waste materials were not excisable goods liable to duty; this finding is in favour of the assessee.

Issue (ii): Whether dolochar was alternatively covered by unconditional exemption notifications applicable to waste arising from manufacture of iron or steel.

Analysis: The relevant notification entries unconditionally exempt slag, dross, scaling and other waste from manufacture of iron or steel falling under Chapter 26. If dolochar were classified by the Department under that chapter as waste from sponge-iron manufacture, the exemption could not be denied.

Conclusion: On the alternative assumption of excisability and classification under Chapter 26, dolochar attracted unconditional exemption and no effective duty liability arose; this finding is in favour of the assessee.

Issue (iii): Whether the extended period of limitation, interest and penalties could be sustained.

Analysis: The dispute concerned the excisability of unavoidable residues and involved divergent administrative views, including a Board circular later rescinded. This demonstrated an interpretational dispute. No fraud, collusion, wilful misstatement, suppression of facts, or intent to evade duty was established.

Conclusion: The extended period was unavailable, and consequential interest and penalties, including personal penalties, could not survive; this finding is in favour of the assessee.

Final Conclusion: No Central Excise duty, consequential interest, or penalties were sustainable in respect of the disputed clearances.

Ratio Decidendi: Marketability, saleability, or tariff classification cannot render an incidental waste or residue dutiable unless it emerges through a process amounting to manufacture or production.

Issues: (i) Whether C&F services rendered at depots/warehouses qualify as input services. (ii) Whether credit for transportation, delivery and unloading at customers' premises is admissible. (iii) Whether the extended period of limitation could be invoked. (iv) Whether equivalent penalty was sustainable.

Issue (i): Whether C&F services rendered at depots/warehouses qualify as input services.

Analysis: Section 4(3)(C) of the Central Excise Act, 1944 includes a depot or consignment agent's premises, from which goods are sold after factory clearance, within the place of removal. Receipt, unloading, storage, handling and loading at depots from which cement was sold had a direct nexus with manufacture and sale and were performed up to the place of removal.

Conclusion: Credit for C&F services performed at the depots/warehouses is admissible, in favour of the assessee.

Issue (ii): Whether credit for transportation, delivery and unloading at customers' premises is admissible.

Analysis: For FOR-destination sales, the place of removal cannot be inferred merely from that description. It depends on the contractual terms concerning transfer of title and risk, responsibility for freight and insurance, inclusion of freight in assessable value, and whether delivery at the customer's premises was an essential condition of sale. If ownership and risk remained with the assessee until delivery, the customer's premises would be the place of removal; otherwise, post-depot services would not qualify.

Conclusion: Eligibility of credit for post-depot transportation, delivery and unloading must be determined upon factual verification of the relevant contractual and transaction documents.

Issue (iii): Whether the extended period of limitation could be invoked.

Analysis: The credit was disclosed in statutory records and returns and the records had been subjected to departmental audit. The dispute involved interpretation of input service and place of removal, with divergent views on FOR-destination transactions. No fraud, collusion, wilful misstatement or deliberate suppression with intent to evade duty was established.

Conclusion: The extended period of limitation was not invocable, and the demand beyond the normal period is set aside, in favour of the assessee.

Issue (iv): Whether equivalent penalty was sustainable.

Analysis: As the requisite deliberate suppression or intent to evade duty was not established, the ingredients for penalty under Rule 15(2) of the Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944 were absent.

Conclusion: The equivalent penalty is set aside in favour of the assessee.

Final Conclusion: Depot-level C&F credit stands admissible, while post-depot credit requires application of the contractual place-of-removal test; only any credit within the normal limitation period remains to be quantified.

Ratio Decidendi: In FOR-destination transactions, post-clearance service credit depends on the actual place of removal, determined from the contractual transfer of title and risk and the obligations governing delivery, freight and insurance.

Issues: (i) Whether Section 147A of the Income-tax Act, 1961, retrospectively validating issuance of reassessment notices by jurisdictional Assessing Officers, is constitutionally valid; (ii) Whether notices under Section 148 issued by jurisdictional Assessing Officers without randomized automated allocation and faceless procedure are valid under Section 151A and the e-Assessment of Income Escaping Assessment Scheme, 2022.

Issue (i): Whether Section 147A of the Income-tax Act, 1961, retrospectively validating issuance of reassessment notices by jurisdictional Assessing Officers, is constitutionally valid.

Analysis: A retrospective validating enactment may neutralise a judicial decision only by curing the defect or removing the statutory foundation on which that decision rests; it cannot merely declare a contrary legal position or directly override judicial determinations. Section 147A purported to exclude faceless assessment units from the meaning of Assessing Officer for Sections 148 and 148A, but left Section 151A, the scheme framed thereunder, and the scheme under Section 130 unamended. It neither addressed the mandatory randomized automated allocation requirement nor removed the basis of the decisions holding that reassessment notices could be issued only through the faceless mechanism. The provision consequently conflicted with the continuing statutory scheme and amounted to legislative encroachment upon judicial power, contrary to the rule of law and the constitutional principle of separation of powers.

Conclusion: Section 147A of the Income-tax Act, 1961 is unconstitutional and struck down, in favour of the assessees.

Issue (ii): Whether notices under Section 148 issued by jurisdictional Assessing Officers without randomized automated allocation and faceless procedure are valid under Section 151A and the e-Assessment of Income Escaping Assessment Scheme, 2022.

Analysis: Section 151A and Clause 3(b) of the e-Assessment of Income Escaping Assessment Scheme, 2022 expressly cover issuance of notices under Section 148 and require issuance through randomized automated allocation and in a faceless manner. The qualification referring to Section 144B applies to assessment or reassessment under Section 147 and cannot exclude issuance of notices under Section 148; such an interpretation would render the scheme ineffective. Notifications or executive instructions conferring concurrent jurisdiction cannot override the statutory scheme. Where the law prescribes a particular mode, the prescribed mode alone must be followed.

Conclusion: Notices under Section 148 issued by jurisdictional Assessing Officers otherwise than through randomized automated allocation and the faceless mechanism are invalid and liable to be set aside, in favour of the assessees.

Final Conclusion: The statutory faceless reassessment regime mandates that reassessment notices be issued only through the automated and faceless process prescribed under Section 151A and the applicable scheme.

Ratio Decidendi: A retrospective validating law is unconstitutional where it merely negates judicial rulings without curing the statutory defect underlying them; a reassessment notice must be issued in the mandatory faceless and randomized automated-allocation manner prescribed by the governing statutory scheme.

Issues: (i) Whether gold is a prohibited item within the meaning of the Customs Act, 1962; (ii) Whether the adjudicating authority was correct in imposing penalty under Section 112(i) of the Customs Act, 1962.

Issue (i): Whether gold is a prohibited item within the meaning of the Customs Act, 1962.

Analysis: Section 2(33) includes goods whose import or export is subject to a prohibition under the Customs Act, 1962 or any other law in force; it is not confined to goods prohibited through a notification under Section 11. Import of gold was regulated by Reserve Bank of India notifications and circulars, and bulk import was restricted to authorised agencies, while passenger import was governed by the Baggage Rules. The persons concerned did not fall within either permitted category, and the gold was brought through an unauthorised land route.

Conclusion: Gold imported in contravention of applicable import restrictions is prohibited goods within Section 2(33) of the Customs Act, 1962, in favour of the Revenue.

Issue (ii): Whether the adjudicating authority was correct in imposing penalty under Section 112(i) of the Customs Act, 1962.

Analysis: Once the seized gold was prohibited goods, Section 112(i) governed the applicable penalty. The adjudicating order identified the goods as prohibited and imposed penalty on that basis. Failure to expressly specify the invoked clause does not invalidate an order where the authority possessed the statutory power and the order disclosed the basis for its exercise.

Conclusion: The adjudicating authority validly imposed penalty under Section 112(i) of the Customs Act, 1962, in favour of the Revenue.

Final Conclusion: The modification of the penalties was unsustainable, and the original confiscation and penalty adjudication remains operative.

Ratio Decidendi: Goods subject to import restrictions under any law in force are prohibited goods under Section 2(33) of the Customs Act, 1962, and their improper importation attracts the penalty regime under Section 112(i).

Issues: (i) Whether the Dispute Resolution Panel directions and consequential assessment were invalid because the directions did not quote a Document Identification Number; (ii) Whether the assessment order, passed after giving effect to the earlier Tribunal remand, was barred by limitation.

Issue (i): Whether the Dispute Resolution Panel directions and consequential assessment were invalid because the directions did not quote a Document Identification Number.

Analysis: Circular No. 19/2019 makes DIN quoting mandatory. A separate intimation bearing its own DIN and identifying the DIN of the enclosed directions establishes the identity and traceability of the communication and constitutes substantial compliance with the Circular's purpose. Retrospective section 292BA prevents invalidation of an assessment for a mistake, defect, or omission in quoting DIN where the assessment order is referenced by DIN in any manner. Objections concerning DIN generation or authentication, and the contention that the DRP directions were not assessment orders, did not affect this position where the accompanying communication sufficiently identified the relevant documents.

Conclusion: The DRP directions and consequential assessment were not invalid for want of DIN in the directions; this issue is decided against the assessee.

Issue (ii): Whether the assessment order, passed after giving effect to the earlier Tribunal remand, was barred by limitation.

Analysis: The remand required verification and an opportunity of hearing; consequently, the second proviso to section 153(5) attracted the limitation prescribed by section 153(3). As the appellate order was received on 18 November 2019, the permissible period expired on 31 March 2021. Rule 28 permitted remand only to the authority from whose order the appeal arose or to the Assessing Officer. The reference to the AO/TPO in the earlier remand did not convert the recomputation into a fresh transfer-pricing reference under section 92CA(1), and therefore did not permit the Revenue to claim the additional extension under section 153(4).

Conclusion: The assessment order was barred by limitation and was quashed; this issue is decided in favour of the assessee.

Final Conclusion: The DIN-related objection did not affect the validity of the proceedings, but expiry of the statutory limitation rendered the impugned assessment legally unsustainable.

Ratio Decidendi: A remand for recomputation of arm's length price does not enable an extension of assessment limitation through a fresh transfer-pricing reference where the recomputation is not initiated on the Assessing Officer's fresh satisfaction under section 92CA(1).

Issues: (i) Whether reassessment orders under sections 144/147 were valid without a notice under section 143(2) after the returns under section 139(1) were requested to be treated as returns in response to section 148 notices; (ii) Whether cash-payment entries in a digital property ledger could be assessed as the assessee's unexplained investment when the registered sale deed showed that the property was purchased by another person.

Issue (i): Whether reassessment orders under sections 144/147 were valid without a notice under section 143(2) after the returns under section 139(1) were requested to be treated as returns in response to section 148 notices.

Analysis: Sections 147 and 148 of the Income-tax Act, 1961 govern reassessment proceedings, and issuance of notice under section 143(2) is mandatory where a return is treated as having been furnished in response to a notice under section 148. The record established that returns were submitted with online replies requesting that the earlier returns under section 139(1) be treated as returns in response to the section 148 notices. The assessing authority also relied upon the income declared in those returns while computing reassessed income. Having taken cognizance of the returns, the absence of a notice under section 143(2) was fatal to reassessment jurisdiction.

Conclusion: The reassessment orders were invalid and quashed for non-issuance of notice under section 143(2), in favour of the assessee.

Issue (ii): Whether cash-payment entries in a digital property ledger could be assessed as the assessee's unexplained investment when the registered sale deed showed that the property was purchased by another person.

Analysis: An addition for undisclosed investment requires material establishing a nexus between the assessee and the alleged investment. Although the digital ledger recorded cash-payment entries concerning a property, the registered sale deed showed that the property was purchased by another person and that the assessee was neither its buyer nor seller. The ledger description alone did not establish that the assessee made the payments or acquired the property.

Conclusion: The cash-payment entries could not be assessed as the assessee's unexplained investment, in favour of the assessee.

Final Conclusion: The reassessment proceedings for the relevant assessment years were nullified for want of the mandatory statutory notice, and the property-ledger entries for the remaining year were insufficient to sustain an investment addition.

Ratio Decidendi: Once a return is treated as furnished in response to a reassessment notice, issuance of the statutory scrutiny notice is indispensable to the validity of the reassessment proceedings.

Issues: Whether the application for renewal of approval under section 80G(5), filed under clause (ii) of the first proviso, was valid and maintainable when regular approval was subsisting on the filing date.

Analysis: Clause (ii) of the first proviso to section 80G(5) applies where an institution already holds approval that is due to expire, whereas clause (iii) applies to an institution holding provisional approval. The applicable clause is determined by the nature of approval subsisting on the date of application. The record showed that regular approval had been granted before the application was filed, and its registration particulars and approval order were disclosed in the application and supporting material. The premise that only provisional approval existed was therefore contrary to the record.

Conclusion: The application filed under clause (ii) of the first proviso to section 80G(5) was valid and maintainable, in favour of the assessee.

Issues: Whether a penalty under Section 271D, imposed by an Assessment Unit after the Penalty Unit became operational under the Faceless Penalty Scheme, 2021, was without jurisdiction.

Analysis: Section 271D vested the power to impose the penalty in the competent prescribed authority. The Standard Operating Procedure dated 06.09.2022 operationalised the Penalty Unit for penalties under Chapter XXI of the Income-tax Act, 1961. The transitional arrangement under Paragraph 4(4) of the Faceless Penalty Scheme, 2021, permitting an Assessment Unit to act as a Penalty Unit, ceased to apply once the Penalty Unit became operational. Since the penalty order was issued thereafter by the Assessment Unit, that unit lacked jurisdiction to impose the penalty.

Conclusion: The penalty order under Section 271D was without jurisdiction and was quashed, in favour of the assessee.

Issues: Whether a developer claiming under a joint development agreement, without established title or proof of payment for the landowner's share, could obtain release or substitution of land provisionally attached as proceeds of crime.

Analysis: Under the provisional-attachment regime of the Prevention of Money Laundering Act, 2002, the claimant relied on a joint development agreement for part of the attached land. No registered sale deed established its ownership, and no material proved payment of the agreed consideration for the landowner's share under the supplementary arrangement. Despite an earlier opportunity to crystallise its rights through appropriate legal proceedings, no such title was established. The claimant had also conveyed plots to purchasers and did not furnish sufficient particulars of the unsold plots or its subsisting share. Its proposed deposit for substitution could not be accepted without proof of right and title in the relevant land.

Conclusion: The claimant's uncrystallised contractual interest did not justify exclusion of the land from attachment or substitution of the attached property.

Issues: Whether an adjudication order passed pursuant to a show-cause notice contemplating an adverse decision is invalid where the noticee was not informed of the date, time and venue of personal hearing.

Analysis: Section 75(4) requires an opportunity of hearing where an adverse decision is contemplated, irrespective of whether the person chargeable with tax or penalty specifically requests such hearing. The petitioner was not provided the date, time or venue of personal hearing, resulting in an infraction of that requirement. In view of the delay in approaching the Court, fresh adjudication was directed upon deposit of 10 per cent of the disputed tax.

Conclusion: The impugned adjudication order was set aside, conditional upon the required deposit, and the show-cause notice was directed to be adjudicated afresh after affording a personal hearing.

Issues: Whether reassessment notices under Section 148 of the Income-tax Act, 1961 for assessment year 2015-16, issued on or after 1 April 2021, were sustainable.

Analysis: The notices dated 09.04.2021 and 27.07.2022 fell within the adopted Supreme Court determination that all notices for assessment year 2015-16 issued on or after 1 April 2021 were required to be dropped, as they could not be completed within the period prescribed under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. The Revenue accepted the applicability of that determination.

Conclusion: The reassessment notices were unsustainable and were quashed.

Issues: Whether a determination under Section 73 could demand an amount exceeding that specified in the show cause cum demand notice and on grounds beyond those stated in that notice.

Analysis: Section 75(7) of the West Bengal Goods and Services Tax Act, 2017 and Section 75(7) of the Central Goods and Services Tax Act, 2017 confine a determination to the amount and grounds contained in the show cause notice. The notice was restricted to Rs. 1,13,55,828, whereas the determination aggregated to Rs. 2,25,47,046. A demand cannot exceed the notice amount or be confirmed on grounds not specified in the notice.

Conclusion: The determination was invalid to the extent that it exceeded the show cause cum demand notice. It was set aside and treated as a show cause notice, with the proper officer required to adjudicate after affording the assessee an opportunity of hearing.

Issues: Whether rubber contraceptives manufactured by the assessee qualify for deduction under Section 80IB despite Serial Nos. 27 and 28 of the Eleventh Schedule.

Analysis: Section 80IB provides a deduction for eligible industrial undertakings, subject to exclusions under the Eleventh Schedule. Serial Nos. 27 and 28 apply to the specifically identified products concerning crown corks and pilfer-proof caps, respectively, and cannot be expanded to cover every product made using rubber. Rubber contraceptives are not among the goods specifically covered by those entries. The principle of consistency and uniformity in application of law also applied, since the deduction had been accepted on identical facts for the remaining eligible years.

Conclusion: Rubber contraceptives do not fall within Serial Nos. 27 and 28 of the Eleventh Schedule, and the assessee is entitled to deduction under Section 80IB.

Issues: Whether the entire amount of alleged bogus purchases was liable to disallowance under Section 69C of the Income-tax Act, 1961.

Analysis: The assessee carried on wholesale trading in industrial chemicals, and procurement from unregistered dealers could not be ruled out. The corresponding sales were not disputed in the assessment or appellate proceedings. In these circumstances, disallowance of the full purchase amount was not justified; only the profit element embedded in the unverified purchases required estimation.

Conclusion: A lump-sum gross-profit disallowance of 5% of the alleged bogus purchases was sustained, with the balance addition deleted, in favour of the assessee.

Issues: (i) Whether the 3% tolerance under transfer-pricing law applies where the arm's-length benchmark is based on a single internal comparable. (ii) Whether the corporate guarantee adjustment should be benchmarked at 0.5%. (iii) Whether a separate notional-interest adjustment on outstanding receivables can be sustained without verifying the treatment of comparable third-party export receivables.

Issue (i): Whether the 3% tolerance under transfer-pricing law applies where the arm's-length benchmark is based on a single internal comparable.

Analysis: The third proviso to Section 92C(2) of the Income-tax Act, 1961, read with Rule 10CA(7) of the Income-tax Rules, 1962 and the notified 3% transfer-pricing tolerance band, governed the determination. The margin earned in the non-AE and domestic segment was used as an internal comparable to benchmark the AE segment. A dataset containing a single value has that value as its arithmetical mean; Rule 10CA(7) does not require more than one comparable for the tolerance to operate. The variation between the declared AE margin and the arm's-length margin adopted was within 3%.

Conclusion: The assessee was entitled to the 3% tolerance benefit, and the transfer-pricing adjustment for the two- and three-wheeler segment was deleted, in favour of the assessee.

Issue (ii): Whether the corporate guarantee adjustment should be benchmarked at 0.5%.

Analysis: The corporate guarantee commission was required to be benchmarked having regard to the distinct nature of a corporate guarantee as compared with a bank guarantee. On identical facts, the applicable arm's-length corporate guarantee rate had been determined at 0.5%.

Conclusion: The corporate guarantee adjustment must be recomputed by applying a 0.5% guarantee commission, in favour of the assessee.

Issue (iii): Whether a separate notional-interest adjustment on outstanding receivables can be sustained without verifying the treatment of comparable third-party export receivables.

Analysis: The asserted uniform policy of not charging interest on delayed receivables from both AE and third-party export customers was material to the proposed notional interest on receivables. The assertion required verification through documentary evidence before determining whether any separate transfer-pricing adjustment was warranted.

Conclusion: The receivables issue was remitted for verification; no interest adjustment shall be made if the absence of interest charged to third-party export customers is substantiated.

Final Conclusion: The vehicle-segment pricing was accepted within the notified tolerance, the corporate guarantee benchmark was limited to 0.5%, and the receivables adjustment requires factual verification.

Ratio Decidendi: A notified transfer-pricing tolerance under Rule 10CA(7) applies even where the dataset comprises a single internal comparable, since its arithmetical mean is that value.