GST receivables neither debited to the profit and loss account nor claimed as a deduction cannot be added to taxable income merely by applying the statutory rule governing unpaid liabilities. Since no deduction had been claimed, the condition for disallowance was absent, making the return-processing adjustment in respect of GST receivables unsustainable. The GST receivables addition was consequently deleted in favour of the assessee.

Net-profit estimation for a civil contractor could not sustain an addition above returned income where complete books and vouchers were unavailable but jurisdictional precedent supported a 6% turnover benchmark. Although profit was estimated at 8% of gross turnover, applying the supported rate would produce income below that already returned. The returned income was therefore accepted, and the excess addition was deleted.

Cash deposits during demonetisation require a satisfactory explanation of their nature and source under Section 69A. Earlier small cash withdrawals, largely through ATMs, do not by themselves establish that cash remained available for a later bank deposit. Relief of Rs. 2.50 lakh is available under CBDT Circular No. 3/2017, restricting the unexplained-money addition to the balance. The enhanced tax rate introduced by the amended Section 115BBE cannot operate retrospectively; the remaining unexplained-money addition is therefore taxable at the normal applicable rate with surcharge.

Penalty proceedings under section 271(1)(c) require the assessment order and notice to identify the precise charge: concealment of income or furnishing inaccurate particulars. Where the assessment order does not specify the basis for initiation and the notice retains both statutory charges without deleting the inapplicable one, the notice is vague. Such ambiguity vitiates the penalty proceedings, resulting in invalidation of the penalty order.

Reassessment additions for alleged bogus long-term capital gains and related commission expenditure require fresh examination where the taxpayer disclosed the same share purchases, sales and net profit as business income in the return filed in response to notice. The assessment must reconcile the quantum of transactions and determine their proper income character before taxing them as capital gains. It must also address whether income already offered as business income can be taxed again without first disturbing that disclosed income. The Assessing Officer must provide reasonable opportunity, with all contentions remaining open.

For assessment year 2017-18, Section 14A allowed expenditure disallowance only where exempt income was earned or receivable in the relevant year. Rule 8D therefore could not apply where no exempt income arose. The Finance Act 2022 Explanation extending Section 14A to income not accrued, arisen or received applies prospectively from 1 April 2022, leaving no disallowance for the year concerned.

Section 14A requires the Assessing Officer to record objective dissatisfaction, based on the assessee's accounts, before applying Rule 8D to disallow expenditure relating to exempt income. This prerequisite applies even where the assessee claims that no such expenditure was incurred. Reasons must identify why that claim is incorrect and link relevant expenditure to exempt income; appellate observations cannot cure the omission. Without this account-based finding, recourse to Rule 8D lacks jurisdiction and the disallowance is unsustainable.

Unrecorded day-book receipts arising from mixed retail-trading and commission transactions are assessable only to the extent of reasonably estimated business income, not as unexplained credits in their gross amount, where the records also show corresponding payments and do not segregate transaction types. A 3% profit estimate applies to the impugned receipts. A separate addition for presumed initial capital cannot stand without material establishing the investment or an enhancement notice. Disallowance of related-party interest as excessive requires fresh factual verification after the taxpayer is allowed to substantiate the actual interest rate paid.

Registration under Section 12AB requires examination of the genuineness of proposed charitable activities, not proof that they have already been executed. Objects providing for old-age homes and senior-citizen facilities, supported by land acquisition, statutory approvals, development expenditure, resident-selection criteria and planned care arrangements, establish a genuine proposed charitable purpose. Where the project remains under development, contemplated facilities and the absence of finalised resident terms do not by themselves establish commerciality. Refusal of registration on those grounds is therefore unsustainable.

Penalty for concealment of income cannot be sustained where the show-cause notice identifies furnishing inaccurate particulars of income as the proposed charge. These are distinct grounds under the Income-tax Act, and the taxpayer must receive clear notice of the specific charge ultimately invoked. Imposing penalty on a charge different from that stated in the notice impairs the taxpayer's opportunity to defend and renders the penalty notice invalid. Consequently, a concealment penalty based on such a mismatch is liable to be deleted.

Reassessment initiated beyond four years of a scrutiny assessment cannot rest on a change of opinion regarding depreciation claims already examined on the same records. Extended reopening requires fresh tangible material indicating income escapement and a failure to make full and true disclosure of material facts; where depreciation schedules and electrical-installation particulars were disclosed, that jurisdictional condition is absent. Transformers, connectivity panels, metal and spark detectors, and yarn-conditioning machines that are indispensable and functionally inseparable from textile manufacturing constitute plant and machinery rather than electrical fittings. They consequently qualify for depreciation at the applicable plant-and-machinery rate and for additional depreciation.

Penalty for concealment of income or furnishing inaccurate particulars was sustained after the related quantum addition had been dismissed in appellate proceedings. No material was produced to rebut the basis on which the penalty had been upheld. The statutory framework governing concealment and inaccurate particulars therefore continued to apply, resulting in confirmation of the penalty.

Section 68 unexplained cash-credit addition was not sustainable where a residential-unit purchaser's bank debit matched the assessee's corresponding bank credit on the same date. The registered sale agreement corroborated that the receipt was an advance towards the property sale, rather than an unsecured loan or unexplained credit. On that evidentiary basis, the Section 68 addition was treated as unjustified and deleted in favour of the assessee.

Reassessment initiated more than three years after the relevant assessment year required escaped income of at least Rs.50 lakh. Although the order under Section 148A(d) alleged escaped income above that threshold, the final reassessment additions fell below it. The jurisdictional condition for extended reopening was therefore unmet, rendering the reassessment notice and consequential assessment order barred by limitation and liable to be quashed.

Territorial jurisdiction before the Tribunal is determined by the location of the Assessing Officer who framed the assessment, rather than by the forum where the appeal is filed. Under the applicable Standing Order, the Assessing Officer's situs is the decisive allocation criterion. Where regular assessment jurisdiction rests with an Assessing Officer at Agra, the Delhi Benches do not have territorial jurisdiction; the appeal must be adjudicated by the appropriate Bench.

Following a search, the deemed-escapement framework applies to the assessment year immediately preceding the search year. Assessment of that year must proceed through the special reassessment mechanism under section 148, rather than solely under the general assessment provision in section 143(3). A notice under section 148 and prior approval under section 148B are mandatory jurisdictional requirements before an assessment order is made. Their undisputed absence makes recourse to section 143(3) impermissible, rendering the assessments without jurisdiction and liable to be quashed.

Recall of an ex parte appellate order may be granted where an assessee demonstrates good reasons for previous non-appearance. Acceptance of the explanation results in recall of the ex parte order and restoration of the appeal for a fresh hearing, with notice to both parties. The miscellaneous application was accepted and the appeal was directed to be listed afresh.

Penalty notices issued under Sections 274 and 271(1)(c) must identify whether the proposed charge is concealment of income or furnishing inaccurate particulars. Retaining both statutory limbs without eliminating the inapplicable limb makes the notice vague, demonstrates non-application of mind, and vitiates the resulting penalty proceedings. A non-speaking refusal of special leave under Article 136 does not trigger merger or constitute a declaration of law under Article 141. It therefore does not displace applicable jurisdictional precedent on defective penalty notices.

Reassessment based on allegations of mutual fund manipulation requires material establishing a direct and rational nexus with the assessee's alleged escaped taxable income. Same-day purchase of mutual fund units and receipt of exempt dividend do not, without more, prove knowing participation in a sham arrangement or render the dividend non-genuine. Dividend-stripping transactions are specifically regulated and are not automatically fictitious. Where the information does not link the assessee to the alleged manipulation, the jurisdictional conditions for reopening under the Income-tax Act are not satisfied, rendering reassessment initiation invalid.

Registration under Sections 12A and 12AA may extend retrospectively to earlier assessment years where an application remained pending until Section 12A(2) applied, statutory conditions were met, and the entity's public-utility character was established. This preserves eligibility for exemption under Sections 11 and 12 despite later processing of the application. Commercial receipts exceeding the prescribed threshold did not, for the relevant period governed by the unamended Section 2(15), displace charitable status where a governmental civic body carried out planned development and public amenities without a profit-distribution motive. Registration consequently continued for subsequent relevant assessment years.