Transfer-pricing rules do not support imputed interest on OFCD investments or associated-enterprise balances where income has not accrued in real terms, recovery is commercially improbable, and amounts are irrecoverable; OFCDs with conversion rights may be quasi-equity, while corporate-guarantee payments are not necessarily loans. Inventory must be valued at cost or net realisable value, whichever is lower, and a consistently applied net realisable value method cannot be replaced by average purchase cost without evidence that it is incorrect. For AY 2015-16, absent an enabling provision, fair market value could not replace actual share-transfer consideration in computing capital loss. Parent corporate guarantees are not comparable to bank guarantees; a 0.5% commission benchmark was treated as appropriate on the stated facts.

Cash deposits made during demonetisation, when claimed as cash sales recorded in the books and included in disclosed turnover, cannot be assessed again as unexplained cash credits without verifying the supporting material. Tax-audit records, bank statements, books of account, cash-sales details and the linkage between deposits and disclosed turnover require examination. Treating recorded sales receipts as unexplained credits despite their inclusion in taxable turnover would result in double taxation. Fresh adjudication is required after verification of the evidence, with adequate opportunity to the assessee.

APMC cess paid on consignment goods by a del credere commission agent does not make consignors' sales the agent's turnover where records reconcile cess with consignors' transactions; the estimated profit addition and book rejection were therefore not sustained. Agency character alone does not discharge the burden to substantiate sundry debtor and creditor balances with details and confirmations, requiring fresh verification. A Rule 46A(3) objection fails where no specific additional evidence is identified. Unsupported loans, advances and deposits require examination of source, nature and genuineness; deletion without missing details was not sustainable and the addition was restored.

Reversal of a general provision for standard assets, recorded as a negative expense in the profit and loss account and reduced in taxable-income computation, requires factual verification to prevent a second tax adjustment where there is no net tax effect. Book profit under Section 115JB should not include a further adjustment for a provision for forfeiture of security deposit that the taxpayer has already added back suo motu. Taxable income and book profit require recomputation after verifying the underlying accounting and tax treatment, without duplicate additions.

Capital-gain taxability requires reconsideration where a newly produced sale deed and power of attorney indicate that the land may have belonged to another person and the taxpayer may have acted solely as that owner's constituted attorney. Because these documents had not been examined by the lower authorities and required factual verification, ownership and the resulting taxability of long-term capital gain remained unresolved. The first appellate order was set aside for fresh consideration of the documents and the parties' submissions.

Rule 17A(2) permits an applicant created otherwise than under an instrument to establish its creation or establishment through supporting records, rather than a formal trust deed or memorandum of association. Registration certificates and records maintained by the Charity Commissioner may evidence a public charitable educational institution's creation, public character, objects and continuing existence, particularly when supported by tax registration, educational recognition and sustained charitable activity. Requirements applicable to private trusts under the Indian Trusts Act, 1882 do not impose an additional condition on public charitable endowments seeking registration renewal. Absence of a formal founding instrument alone therefore does not justify refusal of renewal under section 12AB.

Reassessment notices issued after four years from the end of the relevant assessment year require prior approval from the competent authority under Section 151. When an assessee disputes the existence of that approval, the Revenue must produce the relevant approval record to establish this jurisdictional fact. A statement in the reassessment order that approval was obtained, or reliance on approval-related proceedings for another assessment year, does not prove valid sanction for the relevant year. Failure to establish prior approval invalidates the Section 148 notice and renders the consequential reassessment unsustainable.

Registration under Section 12AB is confined to verifying the genuineness of charitable activities and compliance with material requirements of applicable law; it cannot become an income assessment based only on the mode, amount, or verifiability of donations. Recorded donations and expenditure towards stated charitable objects demonstrate that activities have commenced, absent any finding that those activities are non-genuine. Registration must therefore be granted where the relevant charitable activities and legal compliance are established. A delayed appeal may be admitted on sufficient cause where the explanation shows no mala fides or deliberate delay, with substantial justice prevailing over technicality.

Section 250 gives the first appellate authority powers coterminous with those of the assessing authority, allowing examination of fresh material supporting the assessee's position. Material cannot be rejected solely because it was not furnished during assessment where additions and disallowances arise from factual discrepancies requiring verification. The appellate authority should examine the material and, where necessary, obtain factual verification or a remand report. Additions and disallowances should be determined only after reasonable and adequate opportunity is provided and the discrepancies are factually verified.

Search-derived information concerning another person falls within clause (iv) of Explanation 2 to section 148, read with clause (c) of the proviso to section 148A. The ordinary section 148A process is therefore excluded. Approval limited to a proposed order under section 148A(d) does not establish the independent prior approval required to issue a section 148 notice. Observance of the applicable jurisdictional route and approval requirement is mandatory; approval under the excluded procedure cannot cure the defect. Absence of independent approval renders the notice jurisdictionally defective, requiring the consequent reassessment proceedings and assessment to be quashed.

Section 69A does not cover cash alleged to be returned from disclosed advances paid through banking channels without evidence of an independent unexplained accretion; the cash-return and alleged interest additions consequently fail. Section 56(2)(x)(b) may apply where the stamp-duty value of immovable property exceeds the consideration beyond the statutory threshold, regardless of whether the transaction is characterised as builder financing. Where stamp-duty value is disputed, valuation under the mechanism linked to section 50C is required before the taxable differential is determined. Denial of set-off of brought-forward long-term capital loss cannot rest on an alleged interest characterisation that fails, although eligibility remains subject to verification.

Consequential assessments following revision must remain confined to the matters specified for verification. Where revision requires examination of DCF valuation and projections supporting share premium, an unexplained-cash-credit addition for the entire premium under Section 68 exceeds that scope; any excess over fair market value is addressed, subject to statutory conditions, under Section 56(2)(viib). For AY 2014-15, loan credits require lender-specific proof of identity, transaction genuineness and creditworthiness. The later proviso requiring proof of a lender's source of funds does not apply, and evidence relating to each lender must be cumulatively evaluated.

Incorrect statutory-clause selection in Form 10AB for registration under Section 12A and approval under Section 80G should not, by itself, result in rejection where the error is bona fide and inadvertent. Applications by institutions whose activities have commenced must be filed under the applicable statutory clauses. Where a prior application yielded provisional registration, rectification should be permitted and the applications considered on merits after an opportunity of hearing. The technical rejections were set aside and reconsideration was required.

For a kachha arhtia acting solely as an intermediary in vegetable sales for farmers, sales made for principals are excluded from turnover for the tax-audit requirement, and only gross commission is relevant. Where the intermediary receives customer payments, remits amounts to farmers, and earns commission, the claimed status must nevertheless be established through conclusive documentary evidence. If that status is verified, tax-audit applicability cannot be determined by reference to principals' sales, and penalty for failure to obtain an audit cannot be imposed on that basis.

Sale consideration from listed equity shares sold through a recognised stock exchange cannot be treated as unexplained cash credit merely on general penny-stock manipulation allegations. Genuineness is supported where purchases were bank-funded, shares resulted from a court-sanctioned amalgamation and were credited to a Demat account, the holding period exceeded two years, sales occurred through SEBI-registered brokers, securities transaction tax was paid, and proceeds were received through banking channels. In the absence of material showing cash payment, price rigging, or involvement in accommodation entries, suspicion cannot replace legal proof. Consistent treatment of identical transactions in the same scrip and assessment year further supports genuineness.

Reassessment under Sections 147 and 148 is sustainable where Investigation Wing information on substantial bank cash deposits constitutes tangible material and the Assessing Officer forms a belief that income escaped assessment, rather than acting on mere suspicion or a change of opinion. Cash deposits recorded as cash sales may be added as unexplained cash credits when the taxpayer cannot establish a nexus between the alleged sales, stock movement and bank deposits. Invoices and cash-book entries alone do not prove the genuineness of substantial cash receipts. On these facts, both the reopening and the unexplained cash-credit addition remain sustainable.

Pure reimbursement of common-area maintenance payments made at actual cost without mark-up does not attract tax deduction at source. Such payments merely recoup the underlying maintenance expenses and therefore cannot result in the payer being treated as an assessee in default for short deduction. No liability arises under Sections 201(1) and 201(1A).

Section 56(2)(x) does not apply where the substantive property transaction was completed before its 1 April 2017 effective date, notwithstanding later registration. Full consideration, execution of the binding sale deed, delivery of possession and initiation of stamp-duty adjudication before that date establish pre-effective completion. Registration later merely culminates the earlier transaction. The stamp-duty valuation also lacked finality, while the valuer's report placed the property value below the agreed consideration. The addition under Section 56(2)(x) was therefore deleted.

Sections 69A and 69B require evidence of unexplained money or investment exceeding recorded amounts. Cash returned by builders that is traceable to accounted bank-channel advances, without proof of an independent unexplained source, asset, income or accretion, should not be separately treated as unexplained money or investment. Alleged interest from purported builder financing similarly requires material beyond an inferred financing arrangement. For immovable property acquired below stamp duty value beyond the statutory threshold, section 56(2)(x)(b) may apply irrespective of transaction characterisation. Where stamp duty value is disputed, the section 50C valuation mechanism requires fair market value determination through the Departmental Valuation Officer before taxability and quantum are finalised.

Section 270A(6)(a) excludes disclosed expenditure from under-reported income where the taxpayer gives a bona fide explanation and fully discloses material facts. Software-development expenditure, including impairment of an internally developed software asset and capital work-in-progress, was disclosed in audited financial statements. The dispute concerned whether that expenditure was revenue or capital in nature, not fictitious claims, inflated expenditure, false statements, or suppressed facts. Rejection of an arguable legal claim in quantum proceedings did not negate the bona fide explanation. The amount was therefore excluded from under-reported income and the penalty was deleted.