SHRI R.S. SYAL, VICE PRESIDENT AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER For the Assessee : Shri Prasad Bhandari For the Revenue : Shri Ramnath P. Murkunde ORDER PER R.S.SYAL, VP : This appeal by the assessee is directed against the order dated 13-01-2023 passed by the Pr. CIT u/s. 263 of the Income tax Act, 1961 (hereinafter also called 'the Act') in relation to the assessment year 2018-19. 2. Succinctly, the facts of the case are that the assessee is a co-operative s... ... ...

Omission to adjudicate a ground challenging revisionary action prompted rectification proceedings concerning the effect of an NPA provision disallowance on Chapter VI-A deductions. The unresolved issue was whether profits increased by disallowance of the NPA provision remained eligible for the relevant deduction. The earlier order was recalled only for adjudication of that omitted ground, without reopening the determination concerning deduction claimed on interest from cooperative-bank deposits.

Under the Estates Land Act, a cocoanut plantation falls within "fruit garden" and constitutes a statutory improvement because cocoanuts are fruits and cocoanut trees are fruit trees. Enhanced rent beyond the dry rate is therefore not chargeable for that improvement. In recurring rent claims, res judicata binds the same landlord and tenant as to rights previously determined for the same holdings and areas of cocoanut cultivation, even where the earlier legal interpretation was erroneous. Its effect does not extend to land subsequently planted with cocoanut trees that was not previously litigated; those additional areas require verification and determination under the correct statutory interpretation.

Refined coconut oil qualifies as agricultural produce under the Bihar Agricultural Produce Markets Act, 1960, both before and after the 1982 amendment. The amended definition encompasses processed, unprocessed and manufactured products derived from agriculture, horticulture or plantation, and generally does not require scheduled inclusion; that requirement is limited to livestock and poultry. Under the earlier definition, coconut appeared in the Schedule, falls within the ordinary meaning of vegetable, and oil extracted from it is vegetable oil and a processed coconut derivative. Undefined expressions may be interpreted using dictionaries and encyclopaedias.

Section 151A and the e-Assessment of Income Escaping Assessment Scheme, 2022 require covered reassessment functions and section 148 notice issuance through automated allocation. Risk-based selection of cases is distinct from randomised allocation of the officer authorised to act. Sections 148A and 148 form an integrated reassessment sequence, so general concurrent jurisdiction, administrative instructions or digital service cannot substitute for the prescribed faceless allocation. Section 147A did not amend the continuing statutory and scheme-based allocation requirements and is treated as constitutionally invalid.

Agricultural-land capital-gains exemption depends on the land's character at the time of sale, requiring verification of the conversion date and relevant property and revenue records. Interest on a loan to a bankrupt overseas subsidiary remains subject to arm's-length benchmarking for the relevant broken period. A corporate guarantee for an associated enterprise falls within international transactions, with 0.5% treated as a reasonable commission, while foreign-currency debenture interest requires use of the correctly verified LIBOR rate. Expenditure disallowance related to exempt income cannot exceed that income and cannot be added to book profit unless it falls within specified book-profit adjustments.

CBDT Instruction No. 3/2003 required the Assessing Officer to determine the arm's-length price without referring international transactions to the Transfer Pricing Officer where their value did not exceed the prescribed monetary threshold. The instruction bound income-tax authorities. A reference made despite transactions falling below that threshold was unsustainable and could not trigger the extended assessment period. Consequently, the assessment was invalid as time-barred.

Under Article 136, a refusal of special leave remains a discretionary leave-stage determination. A non-speaking dismissal does not merge the challenged lower-court decision into a Supreme Court order, affirm its reasoning, or automatically create res judicata. A speaking refusal may bind only as to legal propositions expressly declared under Article 141, without producing merger. Merger arises when leave is granted and appellate jurisdiction is exercised. Review, writ, and remanded proceedings remain subject to independent procedural requirements, including limitation and safeguards against abuse.

Section 37 of the NDPS Act imposes cumulative bail conditions in commercial-quantity cases: the court must find reasonable grounds to believe the accused is not guilty and unlikely to reoffend while on bail. These requirements supplement ordinary bail factors and demand a genuine, provisional assessment of credible material. Personal liberty and trial delay remain relevant, but must be reconciled with the statutory threshold. Bail conditions, including verification safeguards for foreign nationals, must be proportionate, genuine and capable of enforcement.

Section 151 approval for reassessment requires the competent authority to form and record independent satisfaction after considering the recorded reasons for reopening. A bare endorsement that a matter is fit for reopening, without demonstrable application of mind, is mechanical and fails the statutory safeguard. Reassessment initiated on that basis is invalid, and the reassessment proceedings were quashed in favour of the assessee.

Form 10AB for regular section 80G approval may be filed subject to the applicable period, with delayed filing capable of condonation on sufficient cause. Absence of regular professional assistance and technical portal difficulties are identified as grounds for condonation; the Tribunal under section 254(1) and the Commissioner under the proviso to section 12A(1)(ac)(iii) may address such delay. Object clauses allowing overseas activities or application of income do not automatically bar regular approval, since the section 11(1)(c) restriction is examined when exemption is claimed. Valid incorporation of proposed memorandum amendments requires verification during fresh merits consideration.

Tax-recovery attachment under the Income-tax Act requires an existing default, while sections 222 and 225 permit recovery proceedings to be modified after appellate orders. Once relief deleting additions has been given effect and resultant arrears have been paid, factual finality at the ITAT level and an extinguished or satisfied demand require release of the attachment. A proposed further Revenue appeal cannot preserve the attachment; subsequent Revenue success permits fresh recovery under the statutory procedure.

Customs-duty liability for pilfered imported goods arises only where pilferage occurs after unloading in a customs area while goods are held by an approved custodian. Approval is indispensable; factual control or statutory custody alone does not impose this liability for a period before approval. Importer duty exemption for pre-clearance pilferage operates alongside the custodian's revenue liability. Pilferage must be proved through contemporaneous records and cannot be presumed from every cargo discrepancy, shortage, or loss.

Section 119(2)(b) permits exceptional admission of a delayed exemption, deduction or refund claim after the revised-return period under Section 139(5) has expired, where this is necessary to avoid genuine hardship. Condonation removes only the procedural bar; exemption, taxability, refund and interest remain subject to independent merits determination under the applicable provisions. Genuine hardship requires a fact-sensitive assessment of bona fides, promptness, the nature of the omission and the practical consequence of refusal. Prima facie verification may test whether the claim is genuine and supportable, but must not become a final adjudication. Comparable decisions may establish that a claim is arguable, while factual verification and substantive scrutiny remain available after admission.

Verified actual TDS deduction supports credit even where the deductor fails to deposit tax, file statements, issue Form 16 or Form 16A, or generate a Form 26AS entry. Section 205 prevents direct or indirect recovery from the deductee to the extent tax was deducted, including adjustment of refunds; post-deduction default remains actionable against the deductor. Section 199 and Rule 37BA require a verification-based credit process harmonised with that protection. The taxpayer must provide reliable, payment-specific evidence, such as payslips, invoices, bank records, payer correspondence or confirmations. The Assessing Officer must conduct factual verification; unsubstantiated claims receive no protection. The stated position is confined to domestic transactions.

Article 21's guarantee of fair procedure encompasses timely pronouncement of reserved judgments. A binding framework requires High Courts to endeavour to pronounce reasoned judgments within three months of reservation, with administrative escalation, rehearing before another Bench where delay continues, and applications for early pronouncement or reassignment. Liberty matters require extra promptitude: reserved bail matters should ordinarily be decided and uploaded the next day, and orders granting bail, suspending sentence or acquitting persons in custody require immediate communication and release subject to stated exceptions. Operative-part orders are exceptional; reasons must be uploaded within seven days, or within fifteen days where p.....

PFUTP liability for alleged settlement-price depression requires cogent evidence of a manipulative act directed at producing an artificial price, not merely a large short derivatives position, closing-window cash sales, or sell orders below the last traded price. Fraud under Regulation 2(1)(c) ordinarily requires inducement; where inducement is not directly established, manipulation requires compelling evidence from market-wide activity, execution mechanics, commercial rationale, and causal price impact. Position-limit breaches and agency-based concentration may support disclosure penalties but do not alone prove fraud. Combined exposure across all derivative contracts must be considered where required by the governing framework. Failure to establish intended price depression precluded PFUTP fraud and disgorgement, while the non-disclosure penalty remained.

Foreign LTC/LFC payments involving an overseas leg or circuitous route fall outside the Section 10(5) exemption, which Rule 2B limits to actual eligible travel to a place in India and shortest-route fare ceilings. Reimbursement limited to a domestic-fare equivalent or a domestic segment does not preserve the exemption. Under Section 192, employers must include known non-exempt payments in estimated salary and deduct tax based on available claim particulars, although they have no unlimited verification duty. Interim recovery restraints do not automatically suspend TDS obligations. Section 201 relief requires recipient-specific return, tax-payment and accountant-certificate proof; interest and Section 271C penalty require separate analysis, including reasonable cause.

Delayed tax payment interest applies only to tax paid through the electronic cash ledger where a declared return is filed late, except where proceedings under sections 73 or 74 have commenced. In other cases, interest runs on unpaid tax from the due date until payment. Interest on wrongly availed and utilised input tax credit runs from utilisation until reversal or payment. Utilisation occurs when the electronic credit ledger balance falls below the wrongly availed credit, with the relevant date determined by the return-payment or ledger-debit mechanism.

Section 74 of the CGST Act permits the extended limitation route only where a show cause notice states factual grounds showing that tax short-payment, erroneous refund, or wrongful input tax credit arose by reason of fraud, wilful misstatement, or suppression intended to evade tax. Bare statutory labels, audit objections, later affidavits, or new grounds in an order cannot cure a notice lacking that jurisdictional foundation. Section 75(7) confines confirmation to grounds specified in the notice, while Section 75(2) may deem a validly founded Section 74 notice to be under Section 73 if aggravated conduct is not established. Deliberate conduct, causal nexus, and taxpayer disclosure are central to extended limitation.