Faceless appellate jurisdiction does not extend to appeals against penalty orders arising from assessments completed following a search under sections 132 or 132A. Although section 250(6B) enables faceless appeals generally, the Faceless Appeal Scheme, 2021, read with the relevant CBDT circular and notification, specifically excludes such penalty appeals from the National Faceless Appeal Centre's jurisdiction. These appeals must be decided by the jurisdictional Commissioner of Income Tax (Appeals). Orders passed by the National Faceless Appeal Centre in excluded search-related penalty matters are liable to be set aside for de novo adjudication by the jurisdictional appellate authority.

Section 263 revisional jurisdiction cannot be invoked solely because the Assessing Officer did not initiate penalty proceedings or record satisfaction for penalty in the assessment order. Penalty proceedings are separate and independent from assessment proceedings; therefore, their non-initiation does not by itself make an assessment order erroneous or prejudicial to the interests of the Revenue. Revisional powers cannot be used to direct initiation of penalty proceedings, and a revisionary order founded only on that omission is invalid.

Third-party grant disbursement does not displace a resident contracting party's withholding-tax responsibility where it satisfies that party's enforceable liability to a non-resident. Section 195 applies when payment includes income chargeable in India, and Section 40(a)(i) disallows the corresponding expenditure if tax is not deducted. Consideration for technical know-how and allied services used for an Indian industrial project is deemed to accrue in India under Section 9(1)(vii), subject to statutory exceptions. Under the India-UK tax treaty, source follows the person bearing the payment obligation rather than the place of remittance. A UK-funded payment mechanism therefore does not alter Indian taxability or withholding obligations.

For Assessment Year 2015-16, the applicable limitation framework required reassessment notices issued after 1 April 2021 to be dropped. The initial notice dated 30 June 2021 and the subsequent reassessment order dated 28 July 2022 were issued after the prescribed cut-off. The reassessment action was therefore time-barred and invalid, and the notice was quashed in favour of the assessee.

Government securities held by a bank as stock-in-trade may be valued at the lower of cost or market value under Section 145, and a consistently applied accounting and valuation method should not be displaced merely because another method is preferred; the related depreciation claim was allowable. A brokerage claim remained allowable after post-remand consideration. Section 41(1) applies only where a trading liability previously allowed as a deduction has been remitted or has ceased. Unclaimed customer balances were not taxable because the bank's continuing legal obligation to repay them precluded any remission or cessation of liability.

Regional Rural Banks treated as co-operative societies for income-tax purposes under the statutory deeming fiction in Section 22 remain eligible for the deduction under Section 80P. The exclusion in Section 80P(4) for co-operative banks does not displace that treatment unless the Regional Rural Bank is established to fall within the relevant co-operative bank categories. An assessment granting the deduction on this basis is legally sustainable and does not satisfy the requirement of being erroneous and prejudicial to revenue for revision under Section 263.

Reassessment notices for assessment year 2015-16 issued on or after 1 April 2021 under section 148 were required to be dropped because proceedings could not be completed within the period prescribed by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. Notices dated 9 April 2021 and 27 July 2022 were therefore unsustainable and quashed. Revenue accepted the applicability of the Supreme Court determination.

For reassessment proceedings, a return filed after the period stated in a notice under Section 148 remains valid where the law applicable to the assessment year permits its filing; it cannot be treated as non est merely because it was delayed. Once that return and the required materials are furnished, service of a scrutiny notice under Section 143(2) is mandatory before reassessment can be completed. Completion of reassessment without issuing or serving that mandatory notice is invalid.

Section 220(6) permits consideration of a stay of disputed tax demand while an appeal is pending. An unconditional stay of the full disputed demand was warranted because the stay rejection failed to address material grounds, including a prima facie limitation challenge to the reassessment notice. The unresolved limitation issue remained for appellate determination. The assessment was high-pitched, with additions nearly five times returned income, and turnover alone did not establish financial soundness.

Approval for reassessment under section 151 requires genuine consideration of the assessee's response to the section 148A(b) notice. Recording that no response was filed when a response existed, and sanctioning reassessment solely on the Assessing Officer's proposal and materials, constitutes mechanical approval without application of mind. Such invalid approval renders the consequential order under section 148A(d) and notice under section 148 unsustainable, while leaving fresh proceedings available in accordance with law.

Interim protection against recovery of a refund credited to the petitioner's bank account was granted pending writ adjudication. The Department had sought direct recovery from the bank based on the Assessing Officer's satisfaction. To balance equities, the existing fixed deposit was required to remain intact pending further orders. Amendment of the writ petition was permitted, and the matter was listed for further hearing.

Faceless assessment procedures require a personal hearing when specifically requested under section 144B(6)(viii) of the Income-tax Act. The applicable SOP also requires at least seven days to answer a final show-cause notice, unless a limitation-driven curtailment is justified. Denial of the requested hearing and unexplained curtailment of the response period breach natural justice and permit judicial review under Article 226. The assessment order, demand notice, penalty show-cause notice, and consequential penalty order were set aside as invalid.

Prima facie jurisdictional objections to reassessment, including sanction and statutory limitation, supported interim protection while the pending appeal remained undecided. Because 20% of the disputed demand had already been deposited, recovery was limited to that amount: adjusted refunds exceeding the deposit were to be returned, and further refund adjustment was barred pending appellate disposal. The appellate authority was required to determine the appeal within 12 weeks.

TNMM comparability depends on functional, asset and risk profiles; entity size may justify a turnover filter even without a prescribed ceiling. Operating-margin analysis may use a cash PLI excluding depreciation where asset types, technology and investment levels cause material depreciation differences. Provisions for bad and doubtful debts ordinarily form operating costs unless demonstrated to be extraordinary. Equipment supplied without charge by an associated enterprise does not constitute a taxable business perquisite where ownership remains with that enterprise, the recipient neither capitalises nor depreciates it, and its use is limited to testing software for the owner.

Section 119(2)(b) provides a statutory remedy to seek condonation for delayed return filing where the appellate authority has no such power. Completion of assessment and pendency of an assessment appeal do not, by themselves, bar that remedy. Genuine hardship requires a liberal assessment of a delay explanation, particularly where a short COVID-19-period delay is substantially similar to a previously accepted delay. Rejection solely on the basis of completed assessment or pending appeal is unsustainable, and the related deduction claim requires consideration on merits in accordance with law.

Absence of an effect-giving order and continued seizure of a locker require prompt administrative consideration while the petition remains pending. The Assessing Officer must provide a personal hearing and issue appropriate effect-giving orders within the stipulated period. Arrangements must also be made to open the seized locker and prepare an inventory of its contents. No final determination has been made on tax liability, refund entitlement, or release of the seized articles; the matter remains listed for further hearing.

Prior approval for an order under Section 148A(d) and a reassessment notice must be obtained from the authority prescribed by the elapsed period from the end of the relevant assessment year. The temporary extension allowing approval by the authority applicable within three years, where that period expired during the 2020 relaxation regime, operated only until 30 June 2021. Approval obtained in July 2022 from a Principal Commissioner did not satisfy the requirement applicable after that period; approval from the higher authority under Section 151(ii) was required. Absence of approval from the statutorily competent authority invalidates the order, notice, and resulting reassessment proceedings.

Assessment validity was questioned where it was issued on a PAN allegedly neither obtained nor used by the petitioner. Material differences between two PAN records, including date of birth and addresses, left unresolved how substantially similar PANs were issued and why one was later deactivated. Original PAN application records, verification material, profile details, and deactivation records were required to be produced for further examination. No final determination was made.

Section 264 revision requires the Commissioner to examine an assessee's grounds and supporting material on merits, even where the assessee did not participate in reassessment proceedings. The Commissioner may call for records and make or direct inquiries, but must pass an order not prejudicial to the assessee. Non-compliance with reassessment notices does not remove the duty to give reasoned consideration to the revision claim. Rejecting revision through a bare assertion that the assessment order is well reasoned, without addressing submissions, is a non-speaking and unsustainable exercise of revisionary jurisdiction.

Under the pre-1 April 2021 reassessment framework, a return filed in response to reopening is treated as a return under Section 139, with scrutiny initiated through Section 143(2). Recorded reasons must be supplied on request, and reopening objections must first be resolved by a speaking order because they may challenge jurisdiction to reopen. Assessment cannot proceed through a scrutiny notice or a Section 142(1) information notice until that disposal. Following rejection of objections, a mandatory four-week interval must elapse before further reassessment action, preserving the taxpayer's opportunity to challenge the rejection.