Fraudulent trading may be established under the Insolvency and Bankruptcy Code where cumulative documentary and circumstantial evidence shows that secured, high-value machinery was removed and replaced without creditor consent by materially lower-value equipment. Contemporaneous financing and hypothecation records, valuation reports, physical signs of removal, unverified asset identifiers, delayed possession and absent purchase records may support fraudulent purpose on a preponderance of probabilities, without direct proof of intent or a series of transactions. Earlier SARFAESI possession proceedings do not create estoppel or exclude jurisdiction. The contribution remedy restores the corporate debtor's depleted asset position; unsupported depreciation and substitute-equipment value assertions do not require reduction of the quantified contribution.

Existing prosecution sanction alleged to be defective, unlike complete absence of sanction, is generally examined during trial and does not justify quashing at the threshold. A copy of the sanction order must be supplied because it is material to an effective defence and its non-supply may cause prejudice. Limitation cannot ordinarily be resolved at the preliminary stage where evidence is required to determine whether conduct was continuing or isolated; delayed cognizance may also be permitted where justified. Investigations ordered under the Companies Act, 1956 before the repeal provision took effect remain preserved, along with related sanctions and proceedings.

Rule 22 of the CESTAT Procedure Rules, 1982 requires an appeal involving a company in liquidation to abate unless its successor, liquidator, or other legal representative applies to continue it within the prescribed period. The period may be extended for sufficient cause. Liquidation proceedings and appointment of an insolvency resolution professional engage this requirement; without a continuance application, appellate proceedings cannot continue.

Two-mole lauryl alcohol ethoxylate falls under CTI 3824 9090/3824 9990 rather than CTI 3402 1300 where it fails the cumulative conditions for an organic surface-active agent under Chapter Note 3 to Chapter 34. Although the product reduced water surface tension, test results showing a translucent liquid and separation of insoluble matter established that it did not meet the required water-solubility condition. HSN explanatory notes exclude water-insoluble surface-active products from Heading 3402 and place them under Heading 3824. The consequential customs-duty demand, interest, confiscation and penalties are therefore unsustainable.

Countervailing Duty and Anti-Dumping Duty liabilities for imports made while levy notifications were in force remain recoverable after those notifications expire; expiry does not extinguish accrued obligations, and Customs Act recovery provisions apply. Valid Advance Authorisations, supported by export-obligation discharge, redemption and utilisation evidence, attract conditional exemption from these duties. For imports outside such authorisations, liability requires proof that each imported item retains the essential character of a casting, rather than merely being a wind-generator component. Extended limitation requires deliberate suppression or wilful misstatement intended to evade duty; prior departmental knowledge defeats that basis, while demands beyond the statutory outer limit are barred. Compliant authorised imports and goods not proved to be castings carry no consequential fiscal liability.

Final and unchallenged statutory findings verifying the individual's identity and business records, rejecting benami characterisation of the property transactions, and recording full income disclosure materially undermined the factual basis for prosecution for alleged tax evasion and falsification of records. Although the settlement process granted immunity only from penalty and did not extend prosecution immunity because the complaint pre-dated the settlement application, the conclusive findings negated the core allegations. Exercise of inherent criminal jurisdiction was therefore warranted to prevent abuse of process, and the complaint, summoning order and consequential proceedings were quashed.

Pending regular assessment proceedings within the six-year period covered by section 153A abate on the date of a search under the second proviso to section 153A(1). Once abatement occurs, the Assessing Officer cannot validly complete the former regular assessment under section 143(3). An assessment made despite that abatement is non est, and proceedings consequentially founded on that assessment are likewise invalid.

Penalty for under-reporting of income does not apply where a Health and Education Cess deduction claim was bona fide when made, supported by favourable judicial decisions including an earlier decision involving the assessee, and later became inadmissible due to retrospective clarification that tax includes surcharge and cess. The claim was voluntarily withdrawn during assessment following the retrospective insertion of Explanation 3 to section 40(a)(ii). Applying coordinate-bench decisions, the penalty under section 270A was directed to be deleted.

Uncorroborated digital data and documents seized from an independent third-party broker cannot, by themselves, establish an assessee's undisclosed on-money receipts in an assessment under section 143(3). The presumption concerning seized material under section 132(4) is confined to the person from whom the material is recovered. Where no incriminating material is found from the assessee and the broker is neither an employee nor a partner or director, independent corroborative evidence is required before attributing alleged sale receipts to the assessee.

Agricultural receipts supported by evidence of actual cultivation, plantations, crops, irrigation facilities, labour engagement, horticultural finance and related expenditure are agricultural income rather than unexplained taxable income. Net income declared after agricultural expenditure may be accepted where it is reasonable for the scale of cultivation and crops grown. In the absence of unexplained deposits, investments or another identified non-agricultural source, assessing the entire gross agricultural receipts without allowing cultivation expenditure is unjustified. The substantiated agricultural income is therefore not liable to be taxed as unexplained income.

Documentary evidence establishing the identity, creditworthiness and genuineness of creditor transactions precludes additions based on alleged unverifiability. Recorded cash sales, sales and stock registers, branch-wise particulars and VAT disclosures may establish the source of cash deposits, preventing treatment as unexplained where the assessment record supports those deposits. Allegations of accommodation-entry transactions require a demonstrated factual basis, such as seized material, statements or other supporting evidence. Additions cannot rest on conjecture, surmise or unsupported allegations of non-compliance when relevant documentary material substantiates the transactions.

Penalty proceedings for concealment of income or furnishing inaccurate particulars are vitiated where the statutory notice uses both limbs of the penalty provision without identifying the precise charge. A composite allegation fails to provide clarity on the basis for initiating penalty and cannot sustain the resulting penalty order. Failure to specify the applicable limb in the notice rendered the penalty invalid in favour of the assessee.

Reassessment jurisdiction under Section 147 read with Section 148 requires a reason to believe founded on existing and correct material. Where recorded reasons rely on Form 26AS receipt figures materially higher than the actual reported receipts, the foundational factual premise is incorrect and non-existent. The notice initiating reassessment and the consequential reassessment order are therefore void ab initio for lack of valid jurisdiction.

Section 68 requires satisfactory proof of creditor identity and capacity and transaction genuineness. Documentary evidence of loan receipts, repayment trail and interest payments, particularly repayment before assessment completion, must be considered in determining whether unsecured loans are unexplained cash credits. Where those facts are established, the loans are not liable to addition as unexplained credits. An interest disallowance founded solely on addition of the principal loans has no independent basis once the loan additions fail; the corresponding interest expenditure consequently remains allowable.

For searches initiated on or after 1 April 2021, assessment of a year preceding the search year falls within reassessment jurisdiction and requires a notice under section 148. A search is deemed information suggesting income escapement, while the exclusion from the preliminary procedure under section 148A does not remove the requirement of valid initiation under section 148. Statutory limitations, approvals and order requirements operate independently; approval for a subsequent order cannot cure the absence of a section 148 notice. Administrative scrutiny guidelines and participation in proceedings under sections 143(2) and 143(3) cannot confer jurisdiction. An assessment initiated only under those provisions is legally unsustainable.

Charitable exemption under Section 11 cannot be denied solely because the prescribed audit report in Form 10B was furnished 22 days after the stipulated date, where it was available before processing of the return under Section 143(1). Section 12A(b) requires timely furnishing of the audit report, but the delay did not defeat the exemption claim when the processing authority had the report before return processing.

Reassessment notices issued more than three years after the relevant assessment year require prior approval under section 151(ii) from the specified senior authority; approval by a Principal Commissioner lacks jurisdictional competence. Competence is determined on the date the notice is issued, rather than the date approval is granted. The proviso effective from 1 April 2023 does not retrospectively exclude the reply period available under section 148A(b). Notices approved by an incompetent authority, and consequential reassessment orders, are invalid.

Penalty for undisclosed income under section 271AAB requires independent proof that the amount falls within the provision's exhaustive statutory definition. Strict construction applies because the provision is penal, and a surrender or admission in a search statement alone does not establish undisclosed income. Vague diary notings of advances, without details of parties, dates, purpose, terms, corroborative transactions, undisclosed assets, or an identified unaccounted source, represent an application or outflow of funds rather than unrecorded income. Deeming rules for unexplained income cannot be imported into section 271AAB's self-contained definition.

Conversion of compulsorily convertible debentures into compulsorily convertible preference shares through a book entry, without funds being received in the relevant previous year, does not create an unexplained sum credited for that year. Share premium recorded solely on that conversion therefore falls outside Section 68, because the provision applies to sums credited in the assessee's books during the relevant previous year.

Condonation of delay was sought by the Revenue, which attributed the delay to a peculiar procedural trajectory. The related issue concerned the legal status of a Transfer Pricing Officer report in an abated proceeding. The Supreme Court found no good ground to interfere with the High Court's order and dismissed the Special Leave Petition.