Non-consecutive invoice numbering under rule 46(b) is a technical irregularity that does not by itself make a duly documented movement of goods unlawful or untaxed. Detention and penalty under section 129(3) are not justified for a bona fide numbering lapse where transport documents are valid, the goods match their recorded quantity and description, and no tax evasion or revenue loss is established. Section 125 is the potential general penalty route for such an infraction, although the required deliberate non-compliance was absent. The transaction between registered dealers was recorded in their accounts and was revenue-neutral.

Transitional CENVAT credit under section 140(1) remains available where an undisputed balance is declared in a timely TRAN-1 and an outstanding ER-1 return is filed at the first available opportunity after departmental portal failures prevented timely filing. Such filing constitutes substantial compliance; procedural requirements cannot defeat substantive credit when compliance is impossible for reasons beyond the taxpayer's control. Section 75(7) confines adjudication to the grounds in the show-cause notice, so a fraud-based penalty cannot be imposed when the notice proposes only a non-fraud penalty. A demand under section 74(1) requires evidence of fraud, wilful misstatement or suppression to evade tax; disclosed portal difficulties and unsupported allegations do not establish those grounds.

Mismatches between Form GSTR-3B and Form GSTR-2A warrant verification but do not alone establish failure to meet the supplier tax payment condition. Reflection of IGST in GSTR-2A, bank evidence of payment inclusive of tax, and reconciliation can discharge the recipient's burden where no material showing supplier non-payment is produced. Verification certificates under the relevant circular are not additional eligibility conditions; its specified mismatch scenarios do not apply where IGST is reflected in GSTR-2A. Inadvertently reporting otherwise admissible IGST credit under CGST and SGST heads is a reporting error, not wrong availment. Provisions governing tax paid under an incorrect head do not prescribe an exclusive remedy for recipient credit. Where appellate relief makes a statutory pre-deposit refundable, interest runs from payment until refund, even without a specific request.

Unbranded kraft paper bags without handles and with a base width below 40 cm fall under tariff item 48194000 as other sacks and bags, rather than the entry for bags with a base width of 40 cm or more. They are not covered by the specified GST exemptions. Kraft paper bags manufactured using adhesive glue attract GST at 5% under entry 319 of Schedule I, which covers paper sacks and bags as well as biodegradable bags. Input tax credit on inputs and input services used in manufacture is available subject to the conditions in section 16 of the CGST and TNGST Acts.

GST exemptions requiring supply to the Government do not extend to government societies. Consultancy to establish incubators for a rural livelihoods society does not directly perform functions under Article 243G; the claimed government-recipient exemptions are unavailable, and the consultancy attracts GST at 18%. Incubation and capacity building form a composite supply, with incubation and enterprise development as the principal supply. Under the contractual arrangement, enterprise-support grants and loans form part of taxable value; passing them on to enterprises alone does not establish a pure-agent exclusion. That exclusion requires written authorisation, actual-cost recovery, separate invoicing and no ownership or benefit to the supplier. The technology business incubator exemption applies only from the effective date of NSTEDB recognition, subject to its conditions.

Examination-related printing using content supplied by educational institutions is a composite supply of services under Heading 9989, with printing as the principal supply and paper as an ancillary input. The institutions retain ownership and usage rights in the content, while the supplier provides the physical inputs. GST exemption applies to services supplied to educational institutions in relation to conducting examinations, including printing question papers, hall tickets, OMR sheets and answer booklets. Post-examination scanning, result processing and printing of marksheets and certificates also qualify, as does associated transportation and delivery.

Transfer pricing comparables for software-development and IT-enabled services must be assessed for functional similarity. Substantially outsourced operations differ from in-house service models, while higher-end knowledge process outsourcing is not functionally comparable to routine IT-enabled or business process outsourcing services when determining arm's length prices using profit level indicators. Comparables with abnormal profits caused by extraordinary circumstances must be excluded where their inclusion would distort the mean profit level indicator. Excluding individual companies selected through filters is distinct from directing the use of filters or a fresh comparability exercise.

Tax-inclusive valuation requires purchases, sales and inventory to include tax, duty, cess or fees actually paid or incurred to bring goods or services to their location and condition on the valuation date. Separate accounting for those amounts, even if followed consistently in earlier years, does not replace the statutory requirement. Non-compliance may render an assessment erroneous and prejudicial to revenue. Revision for inadequate enquiry also requires both conditions to be met. Where cash deposits and sales have been examined, an unsupported deposit discrepancy or a general reference to a third-party search without material linking alleged payments to the relevant assessment year does not establish those conditions.

For presumptive taxation under section 44AE, goods carriages other than tractors or road-rollers are classified as heavy goods vehicles by reference to gross vehicle weight, not unladen weight. Vehicles with gross vehicle weight exceeding 12,000 kilograms fall within the heavy goods vehicle category and are subject to computation under section 44AE(2)(i), rather than the fixed rate for other goods carriages under section 44AE(2)(ii). Unladen weight is relevant to the classification of tractors and road-rollers; a lower unladen weight in a registration certificate does not alter the classification of other goods carriages.

Environmental preservation expenditure may qualify for deduction under ordinary tax provisions despite denial of charitable trust registration. Section 37(1) permits expenditure incurred wholly and exclusively for business purposes, including preservation or protection of the business. Section 57(iii) requires expenditure to be incurred for earning income, but does not require income actually to be earned. Disallowing expenditure supported by unrebutted books and documents, without cogent reasons or rejection of the books, is arbitrary and can result in taxation of gross receipts.

Diwali celebration expenses incurred at business premises with staff qualify as business expenditure where they generate goodwill among employees and customers. General, office and sales-promotion expenses found and conceded to be personal are disallowable. Other expenses cannot be disallowed merely because bills or verifiable vouchers are unavailable, without a specific finding that they are personal or were not incurred for business purposes.

Capital gains arising on conversion of land into stock-in-trade under section 45(2) are chargeable in the previous year in which the converted stock is sold or otherwise transferred. Where land is developed under a development agreement and the owner's share of constructed property is sold in stages, the gain is taxable proportionately in the respective years of sale. If gains are already offered to tax in those years, assessing the entire gain in one year would duplicate those amounts.

Filing a return became a condition for exemption under section 10(23C) from assessment year 2023-24 and cannot be required retrospectively for assessment year 2020-21. For that earlier year, non-filing under section 139(4C) alone does not bar an educational institution from exemption under section 10(23C)(iiiad). The institution must satisfy the substantive conditions, including the applicable receipts threshold, but registration under section 12A is not a prerequisite for that exemption.

Mauritius-resident foreign portfolio investors may claim the Article 13 exemption under the India-Mauritius tax treaty for current-year capital gains without first setting off validly brought-forward short-term and long-term capital losses. Section 90(2) permits selection of the more beneficial tax regime, and neither the Income-tax Act nor Article 13 specifically mandates such set-off before claiming treaty exemption. The previously carried-forward losses may be retained while the exemption is claimed for current-year gains.

Arm's length remuneration of an Indian associated enterprise constituting a dependent agent permanent establishment leaves no further profits attributable to that establishment when it accounts for all risk-taking functions of the multinational enterprise. This principle applies to an internet-advertising business where the Indian entity's cost-plus remuneration remains undisturbed in assessment. Ad hoc allocation of Indian business revenue and estimation of profits do not justify further attribution in those circumstances, particularly where a materially identical method was previously rejected and no distinguishing material was identified.

Percentage-based disallowance of employee benefit expenses and labour charges cannot rest on suspected inflation without verification. Taxpayers must establish the genuineness and business purpose of the expenses, and any disallowance must be confined to expenditure found unsupported, non-genuine or unrelated to business. For deemed rental income, actual occupation and business use of properties during the relevant year require verification before applying the business-use exclusion under section 22. If business use is not established, annual value must be computed after considering relevant fair-rental-value material. Where a negative cash balance is attributed to labour expenses wrongly posted through cash without recording the correspond.....

Pecuniary jurisdiction determines the validity of reassessment notices. Under the applicable instruction, jurisdiction over the corporate taxpayer's returned loss in a metro charge lay with an ITO. A notice issued by an ACIT without that jurisdiction rendered the reassessment proceedings and consequential order void. An appellate authority may conduct its own inquiry under section 250(4), and Rule 46A does not curtail that power. For unsecured loans treated as unexplained cash credits, the taxpayer established the identity and creditworthiness of the lenders and the genuineness of the transactions. Advertising-service advances had already been offered as revenue.

Customs clearance of imported cryptocurrency-mining equipment was withheld because the description and declared value appeared incorrect. The undisputed difference between the declared value and the substantially higher market value supported a prima facie finding of misdeclaration. The circumstances disclosed no arbitrariness, mala fides or abuse of statutory power warranting a CBI investigation. Requests for an investigation and directions on equipment clearance and handling were rejected, and the appeal was dismissed.

Suspension of a customs broker licence pending enquiry requires a substantiated need for immediate action and must occur within a reasonable period. An unexplained delay of several months after the offence report, without new information justifying immediate intervention, undermines the required urgency. The 90-day period for issuing a show cause notice under Regulation 17(1) of the Customs Brokers Licensing Regulations, 2018, is mandatory. A notice issued beyond that period is time-barred and without jurisdiction, and dependent suspension proceedings cannot survive. Timely revocation proceedings remain available under the prescribed procedure.

Confiscation of goods as camouflage under Section 119 of the Customs Act requires evidence that they were used as a guise for moving contraband. Tea located at the rear of a truck did not establish camouflage where elephant tusks were found in the driver's cabin. Penalties under Section 114 require cogent evidence linking the consignor or transporter to the illicit carriage. Neither statements by the persons allegedly involved nor call records established that link, and waybill defects and errors in consignee particulars did not establish involvement by themselves.