Tax-evasion prosecution founded solely on an assessment order lacks a subsisting basis once that order is set aside for fresh assessment. Where the complaint rests on the annulled assessment, the prosecution cannot be sustained. The resulting legal consequence is that the complaint, convictions and sentences are set aside, and the accused are acquitted. The principle applies where the assessment order forms the foundation of the criminal proceedings.

Cash advances received towards the transfer of immovable property constitute specified sums and must comply with the prescribed mode of receipt, even where they are not final sale consideration. Penalty for a cash receipt may nevertheless be avoided where reasonable cause is established under section 273B. A genuine and completed property transaction, confirmations from concerned parties, outstanding housing-loan liability, financial exigency necessitating the sale, and absence of evidence of fictitious dealings or introduction of undisclosed money may collectively demonstrate bona fide reasonable cause. On these facts, the penalty under section 271D was deleted despite the technical contravention.

TNMM benchmarking of IT services may segment associated-enterprise and non-associated-enterprise transactions where different risk profiles make a blended margin distort the international transaction margin. Transfer-pricing adjustments should be confined to associated-enterprise transactions rather than entity-level results that include domestic or non-associated-enterprise dealings. Comparable selection for IT services should apply an upper turnover filter because turnover affects assets, risks and operating margins. Interest disallowance is unwarranted where own funds exceed investments. Indirect expenditure calculations should include only investments yielding exempt income, excluding investments incapable of generating it.

Road construction services are classified under heading 9954. Consideration for construction may be paid partly upfront and partly through deferred annual instalments described as annuities. Entry 23A does not extend to road construction services because it is restricted to heading 9967; consequently, deferred annuity payments forming consideration for construction of roads are not exempt from GST.

Arm's length price determination under TNMM permits exclusion of comparables initially selected by either party where Rule 10B comparability requirements are not met; initial selection creates no estoppel. Related-party transaction filters may exclude companies whose profitability is materially influenced by controlled dealings, including transactions affecting operating costs rather than only revenue. Contact-centre service benchmarking also requires exclusion where financial results are abnormal, outsourcing models materially differ, segmental profitability is unreliable, or diversified, branded, or higher-end service operations lack reliable segmental data. Material profitability differences must be reliably adjusted; otherwise, the company cannot remain an uncontrolled comparable.

Penalty for an alleged failure to furnish transfer-pricing documentation relating to purchases from an alleged associated enterprise was deleted after the underlying transfer-pricing adjustment was removed. The penalty's foundation consequently ceased to exist. Applying an earlier Tribunal decision on identical facts and the principle of consistency, the deletion was sustained and the Revenue's challenge was dismissed. The taxpayer's cross-objection was dismissed as infructuous.

Compulsorily convertible debentures that require interest payments, confer no pre-conversion voting rights and preserve a debtor-creditor relationship cannot be treated as equity solely because conversion is mandatory. Accordingly, nil arm's-length pricing of interest and the related disallowance were unsustainable without applying the prescribed transfer-pricing framework. Additional evidence on actual services, cost allocation and benchmarking required fresh determination of the business-support-services adjustment. An employment-related deduction claim supported by a revised computation and Form No. 10DA also required factual and statutory examination. A challenge to penalty initiation was premature because no penalty had crystallised.

Internal TNMM may benchmark international freight-forwarding transactions where associated-enterprise and non-associated-enterprise segments are substantively comparable. Enterprise-level losses, the share of associated-enterprise revenue, differing agreements, and unquantified air-sea shipment mix differences do not establish a material profitability difference where the uncontrolled segment is substantial, separately identifiable, and performs the same broad activity. The controlled segment's better performance supported satisfaction of the arm's length test and deletion of the transfer pricing adjustment. External TNMM margins cannot be applied entity-wide to include uncontrolled transactions. A challenge to penalty initiation at the assessment stage remains premature.

Consideration for cloud application and IT support services did not constitute royalty under the India-Netherlands treaty because the services neither provided equipment nor conferred a right to use equipment. The receipts also failed to qualify as fees for technical services because they did not make available technical knowledge, experience, skill, know-how or processes enabling the Indian recipients to apply them independently. Interest on the income-tax refund required verification of the alleged double taxation and refund computation, so the tax liability or refund was remitted for fresh computation after a hearing. The challenge to penalty initiation was premature.

Orders refusing rectification of return-processing adjustments are separately appealable, and limitation for the first appeal runs from service of the rectification order or its intimation, not from an earlier processing intimation. A contingent-liability disclosure does not itself establish a deduction claim. Where tax audit records, financial statements and the processing intimation show that a disputed tax demand was neither charged to profit and loss nor claimed as a deduction, disallowing it increases income for an unclaimed amount and constitutes a mistake apparent from the record. The delay finding was set aside, the appeal was admitted, and the adjustment was directed to be deleted through rectification.

Rule 10CA(5) treats an actual royalty rate within the arm's-length range as the arm's-length price; the median applies only when the transaction falls outside that range. Intra-group IT, business-support and administrative services require assessment of need, actual rendition, commercial benefit, duplication and shareholder activity, supported by contemporaneous operational records and rational allocation keys. A nil valuation under the Other Method requires objective pricing material rather than rejection of TNMM alone. Transfer-pricing and business-expenditure enquiries remain distinct: genuine services with a direct business nexus cannot be disallowed merely because their benefit is questioned, absent capital, personal, prohibited or extraneous expenditure. The royalty, service-pricing and alternative business-expenditure adjustments were deleted.

Section 54F may apply to two adjacent flats acquired under separate conveyances where they are physically interconnected and function as one composite residential house. Separate flat numbers, conveyances, parking spaces, and lack of municipal or RERA amalgamation are evidentiary factors, not conclusive statutory conditions; physical verification may determine eligibility for the balance exemption. Ownership of one pre-existing residential house does not trigger the first proviso, which applies only where more than one other residential house is owned on the transfer date. Joint registration with a spouse does not defeat exemption absent evidence of the spouse's contribution to the purchase consideration. The Revenue's appeal was dismissed, with a limited remand for verification.

Section 43CB applies to construction or service contracts, not to self-developed real estate projects undertaken and sold at the developer's own commercial risk. A consistently followed Project Completion Method may continue where the project predates the ICDS-III transitional cut-off and has been accepted in other assessments; the addition under section 43CB was therefore unsustainable. Under the Percentage Completion Method, recognised revenue must match related costs and reflect work performed during the year; using cumulative costs and advances against only current-year expenditure distorted income. Enhancement by treating capitalised work-in-progress as income also requires prior reasonable opportunity to show cause, and capitalised finance, administrative and sales costs do not alone establish accrued revenue.

Section 115JB(5) permits application of other Income-tax Act provisions in minimum alternate tax computation unless expressly barred. Capital gains eligible for section 54G relief under normal provisions may consequently receive corresponding exclusion while computing book profit, without fresh verification where eligibility and quantum are already accepted. An appellate authority may entertain an omitted consequential MAT claim when it arises from existing facts and the prescribed return form provides no specific adjustment field; the restriction on claims not made in the return applies to the Assessing Officer, not the appellate authority. Filing a return under section 139(4) within a CBDT-extended period does not by itself defeat substantive section 54G relief or require separate condonation.

Additional evidence supporting guest-house expenditure and the applicable head of income cannot be rejected solely for want of a separate Rule 46A application without independent merits adjudication; the dispute was remitted for fresh de novo consideration after hearing. The challenge to the appellate order issued after the assessee's death failed because the record did not show notices to a deceased person or that the appellate authority had been informed of the death. Objections to penalty initiation were premature absent a penalty order. Interest under sections 234A and 234B was treated as automatic, compensatory and consequential, for examination while giving effect to the order.

Transfer-pricing reference to the TPO for CCD interest requires actual non-disclosure of the relevant international transaction in Form 3CEB where selection occurred on non-transfer-pricing risk parameters. Form 3CEB identification and quantification of the CCD interest transaction satisfied that disclosure condition; differences between accounting and tax figures did not establish an unreported transaction. Notices, objections and approval could not cure failure of the substantive reference condition. The resulting transfer-pricing adjustment was deleted, while CCD characterisation, benchmarking and interest-deduction merits remained undecided and consequential tax and statutory interest required recomputation.

Under TNMM, the comparable set in a transfer-pricing study is not conclusive and may be revised during proceedings; functional comparability depends on functions performed, assets employed and risks assumed. A manufacturing entity was treated as incomparable to a medical-device trader undertaking related research and development activities, requiring recomputation of the arm's length margin. No notional-interest adjustment was warranted on an interest-free loan to an associated enterprise where the advance was commercially expedient in the context of goods sales, on the stated facts. A challenge to proposed penalty proceedings was premature, while an alleged double disallowance required document-based verification before relief.

Arm's length interest on Indian rupee-denominated NCDs issued to an associated enterprise requires benchmarking against the domestic lending environment and PLR. EBLR-based rates cannot be adopted merely because the PLR regime was replaced for specified bank lending; for fixed-rate NCDs, reliable comparability must be established across tenure, repayment terms, security, interest structure, credit profile, subordination and contractual terms. A credit-risk premium does not cure inadequate comparability analysis. Applying SBI BPLR/PLR to recompute arm's length interest was sustained, and the Revenue's appeals were dismissed for both assessment years.

Before deleting a TDS disallowance for alleged non-deduction on freight-forwarding payments, the appellate authority must conduct a thorough enquiry where the Assessing Officer failed to verify the statutory conditions for applying section 194Q. Co-terminus appellate powers require examination of transaction documents and, where necessary, verification from the Assessing Officer; presumptions based on sample transactions or entity names are insufficient. The appellate order was set aside and remanded to CIT(A) to verify the transactions and determine TDS liability afresh after hearing the assessee.

Demonetised cash qualifies as movable property for benami-law purposes. Where a person supplies cash to another person who deposits it in a proprietary bank account, lends their name, and retransfers the credited amount, the supplied cash may constitute consideration and the credited amount may constitute property held for the provider's benefit. Prompt retransfer does not negate the benami character. After tax remittance and deposit in an interest-free bond under the Pradhan Mantri Garib Kalyan Yojna, attachment may extend only to the unrecovered balance and bond amount; any unavailable balance may be traced through further investigation.