Cash-deposit additions under section 69A require assessment of whether deposits represent income rather than gross receipts. Self-prepared and unaudited cash records, bank material and related documents did not support full acceptance of the explanation, but also did not justify treating the entire cash deposit as unexplained income. The addition was confined to an estimated profit component of 10% of the deposit, taxable at normal rates rather than under section 115BBE.

Interest received by an agricultural co-operative society from investments with a co-operative bank qualifies for deduction under Section 80P(2)(d). The provision covers interest or dividend income received from investments with another co-operative society, and a co-operative bank remains a co-operative society for that purpose. Section 80P(4) excludes a co-operative bank from claiming the deduction itself; it does not prevent another co-operative society from claiming deduction for interest earned from that bank. Such interest therefore remains deductible under Section 80P(2)(d).

Under-reporting of income requires a comparison between assessed income and income determined on processing the return. Where income disclosed in the original return, accepted on processing, is repeated in reassessment and accepted without additions or disallowances, the statutory conditions for treating that income as under-reported are not met. Penalty for under-reporting is therefore unsustainable in the absence of any variation between the processed and reassessed income.

Mandatory corporate social responsibility expenditure is excluded from business-expense deduction under Section 37(1), but that exclusion applies only to computing business income. Donations within such expenditure may independently qualify for deduction under Section 80G where they satisfy its conditions. Revision under Section 263 requires both an erroneous assessment order and prejudice to the Revenue. Where the Assessing Officer has sought and reviewed deduction particulars and receipts, the claim has been examined with application of mind; adoption of a legally sustainable view does not make the assessment erroneous. Revision therefore cannot displace the Section 80G deduction for qualifying CSR donations.

The final assessment order following DRP directions was governed by the procedure under section 144C rather than the limitation applicable to the draft assessment order, and was therefore not time-barred. For the relevant assessment year, permanent establishment had to be determined under Article 5 of the applicable India-UK tax treaty; inapplicable MLI provisions or their underlying spirit could not be invoked. Dependent-agent, fixed-place and service PE required separate treaty-specific examination of contractual arrangements, conduct, and functions, assets and risks, with the Revenue bearing the burden of proof. Profit attribution required FAR analysis and could not rest on an ad hoc percentage; arm's-length remuneration could eliminate further attribution if fully compensatory.

Reassessment notices issued more than three years after the end of the relevant assessment year require prior sanction from the higher authority specified under the applicable reassessment regime. Approval by the Principal Commissioner is insufficient where approval from the Principal Chief Commissioner, Principal Director General, Chief Commissioner or Director General is required, leaving the notice without valid jurisdiction. Time for responding to a notice cannot be excluded from limitation where no extension was sought. A non-speaking dismissal of a Special Leave Petition does not trigger the doctrine of merger or affirm the High Court's reasoning.

Section 148 permits use of search-derived information only where seized material bears a prima facie, live and relevant nexus to the assessee and alleged income escapement. A loose paper recording only a survey number, rate and an unrelated broker's name, predating the taxpayer's purchase and not naming the taxpayer or vendors, lacked that nexus. Subsequent public land-record information and prospective application of the stated rate could not cure its vagueness; the reassessment notice was therefore invalid.

Reassessment cannot revisit a completed scrutiny assessment on the same material where Form 10 filing and the accumulation claim were disclosed, verified, and accepted. Although electronic filing was required, manual filing followed by uploading in response to an assessing query, coupled with verification of related investments, does not support reopening or denial of accumulation benefit. A later different view of an alleged procedural deficiency constitutes an impermissible review or change of opinion; reassessment on that basis is legally unsustainable.

Composite consideration for assigned goodwill and brand names, inseparable from perpetual restrictive covenants, is treated as deferred revenue expenditure where it protects existing business profitability without creating or enlarging the profit-making apparatus. One-fifth is deductible in the relevant year, with the balance deductible equally over the following four years. Legal, professional, travel and related costs incurred for an abandoned acquisition project are revenue expenditure where no plant, machinery, technology or other enduring capital asset comes into existence. This differs from expenditure on an asset that was created before becoming unusable.

The first proviso to section 149(1)(b) retains the limitation period under the earlier reassessment regime for assessment years up to 2021-22. A notice under the new regime cannot be issued once the corresponding six-year period available under the earlier regime has expired. For assessment year 2016-17, the six-year period ended on 31 March 2023; a reassessment notice issued on 31 August 2024 was therefore time-barred. The reassessment proceedings were barred by limitation, resulting in quashing of the section 148A(d) order and section 148 notice.

Income-tax proceedings alone do not justify automatically withholding an assessee's bank accounts. A bank account hold based solely on an Income Tax Department intimation, without prior enquiry, due process, or identified statutory or regulatory authority, lacks a demonstrated legal basis. The direction to hold two accounts was set aside and the accounts were restored to operational status. The validity of the underlying income-tax proceedings and penalty remained unresolved.

Reassessment proceedings require the assessing authority to consider the assessee's response and supporting records before recording cogent reasons that reassessment is warranted and issuing notice. Credits identified as loans, capital transactions, debtor receipts, sale proceeds, cash deposits and refund interest must be evaluated against available material, including balance-sheet schedules. Where apparent inconsistencies concern capital or unsecured loans, clarification should be sought before credits are treated as unexplained. The approval process must not convey predetermination. Non-compliance resulted in quashing of the reassessment-fit order and notice, with fresh consideration after an opportunity for clarification.

Reassessment for AY 2016-17 beyond three years is barred under section 149(1)(b) where the alleged escaped income, after allowing indexed cost, remains below the Rs. 50 lakh threshold. The taxpayer's non-response to initial notices does not remove the Assessing Officer's duty to apply that limitation once the actual escapement is known from TDS information and assessment material. Consequently, a section 148 notice and section 148A(d) order issued beyond that period lack jurisdiction.

Sections 148A(1) and 148A(3) require meaningful notice and a reasonable opportunity to respond to the material and propositions relied on in determining whether reassessment should proceed. Where alleged undisclosed turnover is derived from bank credits, the underlying computation and supporting information must be supplied, particularly when requested. Reliance on additional allegations concerning fund parking or rotation, unsecured loans, interest, expenses or accounting practices absent from the show-cause notice is impermissible. A reassessment fitness determination based on undisclosed material or unnotified propositions would improperly turn the process into a roving enquiry and cannot stand.

Section 148A requires disclosure of the material and propositions supporting proposed reassessment, including the computation underlying alleged undisclosed turnover, so that the assessee has a meaningful opportunity to respond. A notice confined to bank-credit allegations cannot support a later determination relying on undisclosed allegations of fund parking or rotation, loans, expenses, or accounting practices. Reassessment founded on such undisclosed matters cannot be sustained; relevant material and computations must be furnished and a reasonable opportunity given before reconsideration.

Failure to consider an assessee's timely electronic response to a draft assessment order breaches the principles of natural justice and audi alteram partem. A response uploaded within the stipulated period, acknowledged on the e-filing portal, and confirmed by departmental email must be considered before finalising an assessment under the electronic-assessment framework. Proceeding on the incorrect premise that no reply was filed, while making the proposed addition, vitiated the final assessment order, which was set aside.

Rule 10B requires transfer-pricing comparability analysis to be factual, data-driven and based on functional similarity. A company undertaking diversified service, industrial, telecommunications and other sectoral operations may not be comparable with a software-development provider where their functions materially differ. Functional dissimilarity supports exclusion of the proposed comparable, and factual comparability findings require a showing of perversity before interference.

Export incentives available solely because of gherkin exports have a direct nexus with the export business and are treated as operating income when determining the arm's length price. Their origin in governmental policy does not make them ancillary or non-operating profits. Comparable selection for transfer-pricing benchmarking requires functional comparability under Rule 10B: businesses growing, processing and exporting gherkins are not necessarily comparable with general food-processing entities. Transfer-pricing computation must therefore include export-linked incentives as operating income and benchmark the controlled transaction using functionally similar entities.

Reassessment under Sections 147 and 148 cannot be based solely on material seized during a search of a third party where the statutory route under Section 153C applies. Use of such seized material against another person requires the Assessing Officer of the searched person to record and transmit the required satisfaction note before assessment or reassessment proceedings under Section 153C. Sections 147 and 148 remain available only where reopening is founded on independently obtained material. Absence of the required satisfaction note renders reopening on third-party seized material without jurisdiction.

For assessment years beginning on or before 1 April 2021, the first proviso to section 149(1) retains the limitation regime under the pre-Finance Act 2021 reassessment and search-assessment provisions, even where a third-party search occurs later. For Assessment Year 2012-13, the former six-year reassessment period had expired. The ten-year search-assessment block under Explanation 1 to section 153A includes the search assessment year and runs from the end of that year; a financial year 2021-22 search covers Assessment Years 2013-14 to 2022-23, excluding Assessment Year 2012-13. A satisfaction-date reference likewise does not extend limitation. The reassessment notice is therefore time-barred.