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2026 (10) TMI 1305
Case Laws Central Excise
CENVAT credit exclusions require transaction-wise review, while disclosed credits cannot trigger extended limitation or suppression-based penalties.
CENVAT credit for contractor services requires a transaction-wise review of work orders and invoices. The input-service exclusion applies only where a specified construction or works-contract service is used for constructing a building or civil structure, or for foundations or structures supporting capital goods; machinery installation, repair, maintenance and equipment hire are not automatically excluded. Extended limitation requires a proved act of fraud, suppression or other contravention with intent to evade; credits disclosed in statutory records and examined in audit cannot be denied on a mere interpretive dispute. Penalty cannot rest on unproved suppression or a new ground on remand. Interest arises only on credit within the normal period that is found ineligible and utilised.

2026 (10) TMI 1306
Case Laws Central Excise
CENVAT credit for additional customs duty on imported coal remains available despite excise-credit restrictions under separate credit provisions.
CENVAT credit is admissible for 1%/2% additional duty of customs paid on imported coal because Rule 3(1)(vii) independently permits credit of additional customs duty equivalent to specified excise duties. The proviso to Rule 3(1)(i), which restricts credit of specified excise duty where a central excise exemption is used, does not apply to imported coal subject to additional customs duty under the customs exemption notification.

2026 (10) TMI 1307
Case Laws Money Laundering
PMLA summons for suspected loan-proceeds layering remain effective despite pending predicate proceedings or proposed bank settlement.
Scheduled predicate offences and material indicating transfer or layering of loan proceeds support a money-laundering investigation and the use of statutory summons to obtain evidence and documents. Pending challenges to the predicate FIR or investigation do not, by themselves, remove jurisdiction to investigate proceeds of crime. A proposed bank loan settlement or repayment does not independently terminate allegations involving fraud, forgery, or diversion of funds. Blanket protection from coercive action or arrest is not available through summons-quashing proceedings; anticipatory-bail relief must be sought through the competent court. Statutory investigation and compliance with summons may therefore continue.

2026 (10) TMI 1308
Case Laws FEMA
Reasoned adjudicatory orders require disclosed evidence and reasons, requiring fresh adjudication where a penalty finding lacks support.
Reasoned adjudicatory orders must disclose the evidence and reasons supporting a finding; reasoning cannot be inferred from factual narration or material outside the order's stated grounds. Although the company's explanation for seized Indian and foreign currency was accepted and it was exonerated of contraventions, the separate penalty finding against the appellant identified no further supporting material. The dismissal therefore required fresh, reasoned adjudication.

2026 (10) TMI 1309
Case Laws IBC
Authorised representative duties require prior creditor instructions, complete consultation records, and proportionate disciplinary sanctions for compliance breaches.
Authorised representatives of creditors in a class must both record consultation proceedings and prepare minutes identifying the consultation, date, participation, and creditors' views; contemporaneous emails may be incomplete where they omit participation details. They must obtain prior instructions before concurring to extensions for revised resolution plans, even if the request is administrative or time-bound. Under a graduated disciplinary regime, cancellation requires a proportionate response: absent fraud, dishonesty, personal gain, conflict, concealment, stakeholder prejudice, or prior misconduct, incomplete documentation and limited unauthorised procedural action may not justify the maximum sanction.

2026 (10) TMI 1310
Case Laws IBC
Pre-existing quality dispute bars insolvency admission where contemporaneous material shows a plausible contested operational debt before demand notice.
Remand for a fresh reasoned decision permits reappreciation of an enlarged record but requires reasons for departing from previously relevant matters. Under the Insolvency and Bankruptcy Code, a Section 9 application cannot serve as a recovery mechanism for genuinely contested operational debt: the inquiry is whether a plausible dispute existed before the demand notice, not whether the defence is conclusively proved. Returned goods, contemporaneous complaints, supporting media and laboratory material may establish a quality dispute, while contested evidentiary weight, contractual stipulations and liability remain for appropriate proceedings. Implied merchantable quality need not depend on a written quality clause. A plausible pre-existing quality dispute prevents insolvency admission.

2026 (10) TMI 1311
Case Laws IBC
Share-purchase consideration requires independent proof of time value of money before it can qualify as financial debt.
Payment made as consideration under a share-purchase arrangement requires independent proof that it was disbursed against consideration for the time value of money before qualifying as financial debt under the Insolvency and Bankruptcy Code. Accounting classification as an unsecured loan, balance confirmations, interest entries, or tax-deduction entries may acknowledge an amount but do not alter the payment's original character. An unproven oral conversion into an interest-bearing loan cannot establish the required debt in summary insolvency proceedings. Clerical recording errors do not affect merits absent prejudice. Any available recovery must be pursued before the appropriate forum rather than through corporate insolvency.

2026 (10) TMI 1312
Case Laws IBC
Expired public works contracts cannot be revived through insolvency orders after participation in replacement tendering.
Tender bidders whose participation rights or accepted bids are displaced by cancellation and revival of an expired earlier contract have standing to challenge the revival. A former contractor that voluntarily participates in an unchallenged replacement tender acquiesces in that process and waives any claim to continued performance under the original contract. Orders made during insolvency and an approved resolution plan do not extend an expired works contract; statutory protection for specified governmental grants does not require contractual renewal. Reviving the contract at original rates without transparent competition after a substantial lapse is arbitrary and contrary to public interest. Remaining works must be awarded through a transparent competitive process.

2026 (10) TMI 1313
Case Laws Companies Law
SFIO investigation assignment requires recorded public-interest reasons and relevant material; unreasoned investigations and prosecutions cannot stand.
Section 212(1)(c) requires an opinion, founded on cogent and relevant objective material, that an SFIO investigation is necessary in the public interest. Although the satisfaction is subjective, the assignment order must itself disclose the relevant circumstances, independent application of mind, and reasons for both investigation and SFIO assignment; it remains subject to judicial review. An order merely reciting statutory power, without demonstrable reasons, cannot be cured by later minutes, affidavits, or investigation reports, and invalidates consequential proceedings. Earlier dismissal of a co-accused's writ petition as premature, without merits adjudication, does not create res judicata against pending petitions.

2026 (10) TMI 1314
Case Laws Customs
Tariff classification of vehicle radio units covers finished imports and qualifying SKD kits with essential character.
Car Radio Units imported in completely built form are classifiable under Customs Tariff Item 8527 21 00 as motor-vehicle radio-broadcast receivers combined with sound-reproducing apparatus. Under Rule 3(b) of the General Rules for Interpretation, FM/AM reception and sound reproduction determine the units' essential character; touchscreen, connectivity, playback, camera-input and phone-mirroring features remain ancillary. Semi-knocked-down kits are also classifiable under that item where the screen panel, PCBA and cable set are presented together, have the finished unit's essential character, and need only simple assembly, testing and configuration under Rule 2(a). BIS certification requirements remain applicable at import.

2026 (10) TMI 1315
Case Laws Customs
Proportionality in customs broker licensing: isolated verification failures justified a penalty, but not licence revocation or security forfeiture.
Revocation of a customs broker's licence and forfeiture of security are disproportionate responses to an isolated failure to verify an exporter's authorisation and address when the broker had no active role in an attempted prohibited export, promptly dismissed the responsible employee, initiated criminal action, and acted without deliberateness or bad faith. The licensing breach nevertheless justified a monetary penalty. Principles applicable to repeated or continuing violations do not apply where the lapse is isolated and the factual record discloses neither legal error nor perversity.

2026 (10) TMI 1316
Case Laws Customs
Section 108 virtual examination permits secure video conferencing where genuine medical inability makes physical attendance unduly burdensome.
Section 108 customs summons may be complied with through secure video conferencing where bona fide medical inability prevents long-distance travel. Virtual examination can fulfil the purpose of a customs enquiry while ensuring that summons powers are exercised reasonably, proportionately and without undue hardship, consistent with Articles 14 and 21. Recorded medical injury and willingness to cooperate support this arrangement. Safeguards include secure access, identity verification, videography, visible but non-audible counsel presence, and prior reasoned notice if physical attendance later becomes necessary. Continued cooperation with the investigation remains required.

2026 (10) TMI 1317
Case Laws Customs
Condonation of delay in customs appeals requires specific bona fide cause; administrative inaction and unsupported counsel blame fail.
Condonation of delay in customs appeals requires a plausible, specific and bona fide explanation demonstrating diligence. Limitation law applies equally to Government departments; administrative delay, procedural red tape and unsupported blame on counsel do not constitute sufficient cause. Vague assertions that files were transferred, retrieved, or required further documents, without explaining follow-up or delay at each stage, fail the required standard. The 154-day delay therefore lacked sufficient cause for condonation.

2026 (10) TMI 1318
Case Laws Customs
Customs Sampling of Imported Food Remains Available Despite Food-Safety Procedures; Evidentiary Objections Belong in Statutory Adjudication
Customs sampling of imported food goods under Section 144 of the Customs Act remains available for examination, classification, valuation, investigation and enforcement of import restrictions. The Customs and food-safety regimes serve concurrent but distinct functions: Customs controls imports and related enforcement, while food-safety law addresses fitness for domestic consumption. Food-safety procedures, including FSSAI clearance processes, do not create exclusive sampling authority or curtail statutory Customs powers. Objections to sampling methods, laboratory testing, chain of custody and report admissibility are to be addressed in Customs adjudication rather than through pre-adjudication writ directions governing resampling, cargo release, testing timelines or demurrage.

2026 (10) TMI 1319
Case Laws Income Tax
Accrual accounting, withholding, exempt income, and actuarial liabilities govern disputed tax additions, remand powers, and penalty exposure.
Year-end expense provisions maintained under a consistent accrual and reversal practice remain allowable where they represent ascertained liabilities, while cumulative accrued interest beyond the amount claimed cannot be added. Capital expenditure not claimed as a revenue deduction, recorded cash deposits, and income already offered to tax should not be added again. Payments outside tax-deduction-at-source provisions cannot attract withholding disallowance, and no expenditure disallowance arises without exempt income. First appellate remand power does not extend to fresh verification in regular assessments. Actuarially valued leave-encashment liabilities are deductible despite future payment, and valid under-reporting penalty initiation requires recorded satisfaction.

2026 (10) TMI 1320
Case Laws Income Tax
Accepted books and cost reconciliation limit contingency disallowance, while exempt-income and royalty benchmarking rules protect allowable deductions.
Accepted books of account and reconciliation of project costs with regular books support allowance of contingency expenditure absent evidence that the expenditure was inflated, fictitious, or generated unaccounted cash; internal SOP breaches and isolated failure to respond to verification notices alone do not establish such defects. No disallowance under section 14A read with Rule 8D arises where no exempt Chapter III income is earned; joint-venture profit is governed by section 86. A royalty transfer-pricing adjustment requires use of a prescribed method and proper benchmarking, with joint-venture agreements, support services, and relevant revenue appropriately considered in determining arm's-length pricing.

2026 (10) TMI 1321
Case Laws Income Tax
Entity-level TNMM supports royalty benchmarking where transactions are integrated, while CUP requires reliable uncontrolled comparables.
Royalty paid to an associated enterprise under an agreement supporting manufacturing operations may be benchmarked with related transactions through entity-level TNMM where the transactions are interrelated. Section 92C requires the arm's length price to be determined using a prescribed method. CUP requires comparable uncontrolled transactions; without them, it cannot support a royalty adjustment. A nil royalty determination based solely on a benefit test is impermissible. Where the agreement, technical support and material facts remain unchanged from prior years, consistency supports continued use of entity-level TNMM.

2026 (10) TMI 1322
Case Laws Income Tax
Foreign tax credit survives corrected filing errors when the original claim was filed within the prescribed time.
Foreign tax credit under section 90 and Article 23 of the India-Germany DTAA provides relief from double taxation, while Rule 128 prescribes the claim procedure. Where Form No. 67 is filed within the prescribed time, an incorrect DTAA article reference is a curable defect if later rectified. Rule 128(9) is directory and does not justify denying foreign tax credit solely because a corrected form is filed late. Credit remains subject to verification of foreign tax payment and eligibility under the applicable provisions.

2026 (10) TMI 1323
Case Laws Income Tax
Incriminating search material limits additions for completed assessment years, while block-period and limitation rules restrict search assessments.
Search assessments under section 153A must remain within the applicable ten-year assessment block; years outside it cannot be assessed under that provision. The extended block requires material showing escaped income represented by a qualifying asset, so foreign-travel expenditure and unsecured loans, being liabilities, do not satisfy that jurisdictional condition. For completed, unabated years, additions require incriminating material unearthed during the search; disclosed books, recorded expenditure, and pre-existing investigation statements are insufficient. Section 153B also requires completion within the prescribed limitation period; an assessment completed after that deadline is time-barred. These requirements can invalidate assessments and related additions that fail the relevant condition.

2026 (10) TMI 1324
Case Laws Income Tax
Mandatory scrutiny notice renders search-related assessments invalid when returns are assessed without the required jurisdictional safeguard.
Issuance of notice under section 143(2) is a mandatory jurisdictional condition before income returned in response to a section 153C notice may be assessed under section 143(3). Complete absence of that notice is not a procedural defect curable under section 292BB. Where competing interpretations of a taxing provision exist and no jurisdictional High Court ruling applies, the interpretation favourable to the assessee governs. Assessments completed without the mandatory notice are invalid and liable to be quashed.

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