Issues: Whether the agreements relating to jointly held ancestral land effected a transfer of the assessee's capital asset, attracting long-term capital gains.

Analysis: The Tribunal's finding that the documents did not evidence a transfer by the assessee was supported by the subsequent agreement and the final partition decree. The land forming the subject of the joint development arrangement fell to other family members, whereas the assessee continued to hold the land allotted to his share. The factual finding was supported by material on record and was not perverse.

Conclusion: No transfer of the assessee's capital asset was established; deletion of the long-term capital-gains additions was sustained in favour of the assessee.

Issues: Whether reassessment proceedings initiated after a completed scrutiny assessment were invalid as being founded on a change of opinion and on grounds not disclosed in the recorded reasons.

Analysis: The original scrutiny had specifically addressed the share sale, its valuation, the purchaser's identity and creditworthiness, the transaction's genuineness, and the consequential capital-gains exemption claim. The claim was accepted after detailed inquiry under the scrutiny assessment. An assessment order need not discuss every query or record detailed reasons while accepting a claim; acceptance following inquiry establishes formation of an opinion. The subsequent notice sought to reopen the assessment on the same share transaction and material, and was therefore founded on a change of opinion. Further, the proposed challenge to the exemption claim based on the nature of the agreement for acquisition of residential property was absent from the show-cause notice. Recorded reasons cannot be supplemented or improved through an affidavit or oral submissions.

Conclusion: The reassessment proceedings were invalid as based on a change of opinion, and the notice under Section 148A(b), the order under Section 148A(d), and the consequential notice under Section 148 were quashed.

Issues: Whether a reassessment notice could validly be issued in the name of an entity that had ceased to exist upon merger with the petitioner.

Analysis: The merger had been sanctioned with effect from 01.04.2019, and the erstwhile entity no longer existed when the notice for assessment year 2022-23 was issued. The revenue authorities had also been informed of the merger, and the petitioner had conducted the business thereafter. A notice issued against the dissolved entity was therefore legally unsustainable.

Conclusion: The reassessment notice issued in the name of the non-existent merged entity was quashed, in favour of the assessee.

Issues: Whether income-tax arrears not claimed before the committee of creditors survive after approval of a resolution plan by the adjudicating authority.

Analysis: An approved resolution plan is binding upon all stakeholders. Its purpose is to enable the corporate debtor to revive on a fresh slate without being exposed to claims that were not included in the plan. As no claim concerning the impugned tax arrears was placed before the committee of creditors or incorporated in the approved resolution plan, those arrears stood frozen upon approval of the plan.

Conclusion: The income-tax claims not forming part of the approved resolution plan do not survive, in favour of the assessee.

Issues: Whether the order giving effect to the appellate order could stand despite denial of the expressly contemplated opportunity of hearing to the assessee.

Analysis: The operative portion of the order dated 29.03.2025 contemplated a reasonable opportunity of hearing. It was conceded that no such hearing had been afforded. The earlier High Court orders had also specifically required an opportunity of hearing. Denial of that opportunity warranted reconsideration by the Assessing Officer, with all contentions kept open.

Conclusion: The order dated 29.03.2025 and the impugned High Court judgment were set aside, and the matter was directed to be reconsidered after hearing the assessee. The issue was decided in favour of the assessee.

Issues: Whether an order initiating reassessment could be sustained where the assessee's uploaded reply was not considered and the time to respond was curtailed.

Analysis: The statutory response period was curtailed despite time being available to complete the process. The assessee had sought further time before expiry of the curtailed deadline and uploaded its reply before the order was made. Non-consideration of that reply caused prejudice and constituted an irregularity violating principles of natural justice.

Conclusion: The order under Section 148A(d) and the consequential notice under Section 148 were set aside, with a direction to make a fresh determination after considering the reply; this is in favour of the assessee.

Issues: Whether interest expenditure attributable to borrowings allegedly used for acquiring land was disallowable where the land was used as a business storage yard and sufficient interest-free funds were available.

Analysis: Section 36(1)(iii) allows interest on capital borrowed for business purposes, while its proviso restricts deduction up to the date on which an acquired asset is first put to use. The evidence of deliveries, unloading, electricity consumption and photographs supported the use of the open land as a storage yard for bulky trading stock. Construction of an additional structure on part of the land, shown as capital work-in-progress, did not negate the business use of the remaining land. No specific borrowing or quantifiable interest was identified as directly attributable to construction of the incomplete structure. Further, capital and interest-free loans were sufficient to meet the land cost; in the absence of a direct nexus between interest-bearing borrowings and the investment, the investment was presumed to have been made from interest-free funds.

Conclusion: The interest disallowance under Section 36(1)(iii) was not sustainable and was deleted, in favour of the assessee.

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.