Section 50C deems stamp-duty value to be the full value of consideration for capital-gains computation, subject to a DVO valuation where the taxpayer objects. The third proviso to Section 50C(1), providing a 10% safe-harbour tolerance, applies retrospectively. Therefore, where the DVO valuation exceeds the declared sale consideration by only 8.5%, the declared consideration cannot be substituted and no addition under Section 50C should arise.

Section 80-IA deduction for profits from solar-electricity generation requires the prescribed audit report in Form 10CCB together with the relevant agreement, approval or permission under Rule 18BBB. Furnishing Form 10CCB alone does not establish eligibility where the solar-plant approval and completion certificate stand in the name of a separate partnership firm rather than the proprietary concern claiming deduction. Where that partnership firm also sells the generated electricity to the supplier, the proprietary concern cannot claim the deduction.

Penalty for concealment under Section 271(1)(c) is not leviable where additional income disclosed in a Section 153A return is accepted without variation after tax payment and no incriminating material supports the disclosure. Treating the Section 153A return as a return under Section 139, the requirements for concealment, including deemed concealment under Explanation 5A, are not met. In an unabated assessment, a search-related addition requires incriminating material found during the search; an estimated addition without such material is unsustainable, and no penalty can rest on it. Penalties for both categories of additions remain deleted.

Accommodation-entry additions based substantially on a third-party statement cannot be sustained where the taxpayer receives no opportunity to cross-examine the statement-maker. Documentary evidence including lender details, ledger records, bank records and an affidavit supported the identity, creditworthiness and genuineness of a short-term loan repaid through banking channels. Once the primary evidentiary burden is discharged, suspicion alone cannot justify an unexplained-credit addition without independent contrary enquiry or material. The alleged accommodation-entry addition and consequential commission were therefore deleted.

Transfer-pricing analysis for ITES/BPO services requires comparables to satisfy functional comparability and Rule 10B(4) data requirements: R Systems International may be included only where publicly available quarterly data permits alignment, while product-development, KPO, extraordinary-acquisition, and functional differences support exclusion of unsuitable companies. Expenditure disallowance relating to exempt income does not arise where no exempt income is earned in the relevant year. Under TNMM, foreign-exchange gain or loss directly arising from ordinary trading transactions forms part of operating results; foreign-exchange loss must therefore be included in operating costs, notwithstanding the scale of exchange-rate movement or the timing of receipts and payments under mercantile accounting.

Prospective omission of the specified-domestic-transaction provision from assessment year 2017-18 did not invalidate transfer-pricing assessment for assessment year 2013-14, applying strict construction of taxing statutes. Comparable selection required functional similarity: accumulated losses or abnormal profitability alone did not justify exclusion where adjustments were feasible, while plastic-container and moulded-plastic manufacturers were unsuitable comparables. The arm's length price required consequential recomputation. Exempt-income expenditure disallowance required recomputation using only investments yielding dividend income. Preliminary expenditure incurred to explore a manufacturing-related venture that was ultimately abandoned retained its revenue character and was allowable.

Addition for unexplained investment in construction cannot rest solely on a Departmental Valuation Officer's estimated cost exceeding the declared cost. A departmental valuation is only an estimate and does not prove actual undisclosed expenditure. Where the effective difference, after personal-supervision allowance, could result from use of higher CPWD rates rather than applicable local PWD rates, and the taxpayer's Haryana PWD-based valuation is not rejected on cogent grounds, independent corroborative evidence is required. In the absence of material proving expenditure beyond the disclosed construction cost, Section 69 addition cannot be sustained.

Penalty under Section 271AAC(1), being consequential to an addition taxable under Section 115BBE, cannot survive once the Section 69A addition for unexplained money is deleted. Amounts received and deposited by a banking business correspondent on behalf of customers and the bank do not constitute the correspondent's unexplained money. Penalty under Section 272A(1)(d) for non-compliance with statutory notices is not automatic, as Section 273B protects an assessee establishing reasonable cause. Limited familiarity with electronic tax proceedings and absence of deliberate obstruction may constitute reasonable cause, excluding notice-default penalty.

Reassessment notices must be transmitted to the proper person within the limitation period; digital signing alone does not satisfy Section 149. Where postal records show booking after the statutory deadline, dispatch is not compliant with Section 282 read with Rule 127. Section 292BB cannot cure non-service when the assessee objects during assessment proceedings. A notice dispatched after limitation is time-barred, rendering the consequential reassessment invalid.

Online gaming winnings under Section 115BB must be identified after setting off participation buy-in amounts against gross gaming receipts. Although Section 58(4) bars deductions for expenditure incurred in earning such winnings, it does not permit gross receipts to be treated automatically as taxable winnings without determining the net result of the gaming transactions. Where platform data shows that total buy-ins exceed gross winnings, no taxable gaming income arises. The gross-winnings addition was therefore deleted.

Penalty for misreporting of income under Section 270A(8) requires identification of the applicable clause in Section 270A(9) and findings that its statutory ingredients are met. Imposing penalty solely because a capital-gains addition was made, while merely using the term "misreporting" without specifying the relevant clause or supporting particulars, is arbitrary. The penalty was therefore unsustainable and deleted.

An assessment framed under Section 147 read with Section 144C(3) is not a best judgment assessment under Section 144. Consequently, the proviso to Section 251(1)(a) does not permit the appellate authority to set aside that assessment and remit it for fresh assessment. The appellate authority must decide the grounds of appeal on merits through a speaking order, after providing reasonable opportunity to both parties and complying with Rule 46A where applicable. A remand order issued without merit-based adjudication must be set aside, with the appeal restored for adjudication on the grounds raised.

Commission earned by a telecom recharge-voucher distributor, rather than gross bank receipts routed to obtain and supply vouchers, constitutes its business turnover where the distributor acts on commission. Amounts passing through the bank do not represent the distributor's purchases or sales when tax deduction records support commission-based income. As the commission income remained below the prescribed tax-audit threshold, no audit obligation arose and penalty for failure to obtain an audit was unsustainable.

Section 119(2)(b) permits admission of delayed income-tax refund claims where relief is required to avoid genuine hardship, without prescribing a limitation period. The six-year restriction in Circular No. 9/2015 cannot curtail that statutory discretion, although departmental circulars bind income-tax authorities. Refund-condonation applications rejected solely for exceeding that period require fresh consideration on merits, including in constitutional writ proceedings.

Absence of exempt income precludes disallowance of expenditure relating to exempt income. Where appropriate tax has been deducted on payments, deduction under a withholding provision regarded as incorrect does not justify expenditure disallowance when the order treating the taxpayer as in default has been set aside. Expenditure disallowed under the exempt-income provisions is not required to be added back in computing book profit under the relevant minimum alternate tax adjustment. The asserted disallowances concerning exempt-income expenditure, tax withholding classification and book-profit computation are therefore unsustainable.

Reassessment proceedings concerning a deceased assessee must be initiated against the legal representatives where the tax authority had prior notice of the death. Section 159 of the Income-tax Act permits proceedings begun during the assessee's lifetime to continue against legal representatives and permits proceedings capable of being initiated against the deceased to be initiated against them. A reassessment notice issued after death in the deceased's name cannot be sustained. Fresh notice must be issued to the legal representatives, and the specified period is excluded when computing limitation.

Section 153C proceedings require a satisfaction note to be recorded when proceedings against the searched person are initiated, during those proceedings, or immediately after their completion. Recording satisfaction more than four years after completion of the searched person's assessment does not meet the requirement of immediate recording. Pandemic-related disruption and the faceless assessment scheme do not justify that delay. Consequently, the delayed satisfaction note invalidates the proceedings against the person other than the searched person, requiring the notice, consequential assessment order and demand notice to be quashed.

Priority under section 26E of the SARFAESI Act places a secured creditor's registered security interest ahead of government revenues, taxes and cesses. An income-tax attachment predating CERSAI registration can displace that priority only where it was validly enforced and publicly proclaimed as required by law. Failure to establish the required proclamation or registration of the revenue claim or attachment with CERSAI prevents the attachment and resulting encumbrance from prevailing. The secured creditor's dues therefore take priority, and the unproclaimed income-tax attachment is liable to be removed.

Deductions under Sections 80-IA and 80-HHC are governed by the distinction between computing a deduction and allowing it. Deduction under Section 80-HHC must be computed on gross total income before deduction under Section 80-IA is allowed; therefore, the Section 80-IA deduction is not reduced from business profits when calculating the Section 80-HHC deduction. The combined deductions remain subject to the ceiling that they cannot exceed the profits and gains of the eligible business.

Sufficient cause under section 260A(2A) of the Income-tax Act can encompass a short filing delay where record movement, legal advice, administrative approval, appeal preparation and execution collectively show bona fide diligence rather than negligence or inaction. The provision contains no language barring condonation after expiry of the limitation period. Assessment of the proposed appeal's merits remains outside delay-condonation review. On these principles, the 31-day delay in filing the income-tax appeal was condonable.