Payments to overseas rights holders for live broadcast rights did not constitute royalty where live events were not copyrightable works and the consideration was specifically allocated to Live Rights rather than a bundle of rights. The payments were not made to satellite operators and did not concern use of a satellite or any process. On this basis, such payments fell outside royalty under Section 9(1)(vi) of the Income-tax Act, with no tax deduction obligation under Section 195 and no resulting disallowance under Section 40(a)(i).

Internal TNMM was considered relevant because associated-enterprise and non-associated-enterprise export transactions involved similar functions, assets and risks. Correcting the segmental allocation of non-operating expenses showed that the associated-enterprise segment margin exceeded the non-associated-enterprise margin. The analysis also states that, even under the Transfer Pricing Officer's computation, the margin fell within the applicable Section 92C tolerance range. On materially similar prior-year facts, audited accounts and undisputed underlying figures supported acceptance of segmental results without separately audited segments. The transfer-pricing adjustment was therefore described as unsustainable and deleted.

Advertisement, marketing and sales-promotion expenditure was treated as commercially expedient where increased beverage sales increased demand for concentrates, with any benefit to bottlers or brand owners being incidental. Marketing-support rebates, discounts, service charges and reimbursements were similarly described as wholly and exclusively connected with the concentrate business. Depreciation on coolers was considered allowable where the assessee retained ownership and control and the coolers supported beverage sales linked to concentrate demand. The transfer-pricing adjustment for advertising, marketing and promotion expenditure was described as unsustainable because the proposed mark-up did not arise from a recognised transfer-pricing method and overall profitability compensated the relevant functions. Consistent earlier decisions on materially identical facts were to be followed absent distinguishing material.

Under the India-UK tax treaty's make-available requirement, borrowed advisory and consultancy services do not constitute fees for technical services unless they transfer technical knowledge, skill, know-how or processes enabling the Indian recipient to apply them independently. As no such transfer was established, the borrowed-services receipts were not taxable as fees for technical services. Corporate control or shareholding alone does not create a permanent establishment under the treaty, and no other cogent evidence of an Indian permanent establishment was produced; the receipts therefore could not be taxed as business profits. Expense reimbursements without a profit element also did not give rise to taxable fees.

Administrative approval preceded the notice under section 143(2), so the assessment was not invalid. Satisfaction recorded for reopening under section 151 was sufficient absent evidence of non-application of mind, and the unsupported challenge to approval under section 148B failed. Seized records were usable against the group because it possessed and controlled the premises, accepted and deciphered the records, and the entries matched group bank transactions. However, intermingled handwritten and digital cash-book entries required a single chronological peak-credit computation to prevent double taxation; separate on-money and other additions in the assessee's hands were to be removed and the incremental annual peak assessed in the designated flagship group entity.

Protective additions based on the same facts, evidence and conclusions as corresponding substantive additions cannot survive once the substantive additions are deleted and the related assessments are quashed. Where the underlying material lacks evidentiary value and does not establish alleged commission receipts or the assessee's involvement, protective assessments are unsustainable. For the relevant assessment years, applicable jurisdictional precedent on the validity of proceedings further prevented retention of the additions where no distinguishing factual or legal basis existed. The combined effect is that protective additions must be deleted when neither the substantive assessment nor reliable evidence supports the alleged income.

Recorded cash deposits during demonetisation were explained where audited books showed sufficient cash-in-hand, supporting records were produced, and no defect in the books was identified or the books rejected. Unserved notices to certain borrowers did not by themselves disprove recorded cash recoveries, particularly where notice details were not supplied. Ad hoc disallowance of commission expenditure lacked a specific basis after acceptance of the books. Likewise, percentage-based disallowance of travel expenditure was impermissible without identifying non-business or personal expenditure, where travel related to loan recovery and field verification in a non-banking financial business. The appellate deletion of the cash-deposit addition and both expense disallowances remained undisturbed.

Attribution of offshore income to an Indian project office must follow an arm's length functions, assets and risks analysis where dealings with the head office constitute an international transaction. The project office performed limited on-site technical support under Italian head-office control, while principal deliverables, functions and risks remained in Italy. Its transactional net margin method study showed remuneration above the comparable arm's length range, with no identified defect in the method or comparables and no contrary analysis. An ad hoc allocation of gross receipts was therefore unsustainable, resulting in no further income being attributable to the project office.

Failure to supply recorded reasons and the underlying reopening information despite the assessee's specific request denied a meaningful opportunity to challenge reassessment jurisdiction and submit objections. This breached principles of natural justice and the mandatory reassessment procedure. As the Department did not establish that these materials had been furnished, the reassessment notice and consequential reassessment order lacked valid jurisdiction, were void from inception, and were quashed.

Where a resident payee files its return, includes interest income in taxable income, pays the due tax, and the payer furnishes a prescribed accountant's certificate in Form 26A, the payer is not treated as an assessee in default for failure to deduct tax at source. The second proviso to Section 40(a)(ia) then treats tax as deducted and paid on the date of the payee's return. As the certified Form 26A undisputedly established these conditions, the disallowance for non-deduction of tax on interest was required to be deleted.

Unsecured loan additions require proof of the creditor's identity, creditworthiness and the genuineness of the transaction. Loan confirmations, banking records, financial records, interest payment with tax deduction, repayment through banking channels, and the creditor's confirmation established these requirements; unsubstantiated general allegations about accommodation entries could not support an unexplained cash-credit addition. Expenditure disallowance relating to exempt income must be computed under the prescribed method by considering only investments that actually yielded exempt income during the relevant year. The cash-credit addition was deleted and the disallowance was directed to be recomputed on that restricted basis.

Interest on INR-denominated compulsorily convertible debentures issued to an associated enterprise must be benchmarked by reference to the currency in which the borrowing is denominated and repayable. LIBOR applies to foreign-currency borrowings and does not apply merely because the debenture holder is a foreign associated enterprise. Accordingly, INR-denominated CCDs should be compared with domestic INR-denominated debt instruments using the domestic prime lending rate. On this basis, benchmarking at domestic PLR rather than LIBOR plus a spread resulted in deletion of the transfer-pricing adjustment.

Transfer-pricing comparability under TNMM requires exclusion of companies that fail the applied related-party-transactions filter or lack segmental results for diversified operations. I-Design Engineering Solutions Ltd. exceeded the relevant related-party-transactions threshold, while Tata Consulting Engineers Ltd. undertook varied engineering, project-management and construction-management activities without separate engineering-design segment results. The arm's length price requires recomputation after their exclusion. Payments for software to an associated enterprise are not subject to withholding-based disallowance where they are not chargeable to tax in the recipient's hands and do not constitute royalty under the applicable tax treaty.

A notice under section 143(2) need not disclose the category of scrutiny or follow a statutory format, because the Act and Rules require only a timely notice enabling the assessee to attend and produce evidence. CBDT scrutiny classifications and prescribed formats are administrative directions, not additional jurisdictional conditions. Breach of such instructions does not invalidate assessment proceedings unless it compromises a statutory prerequisite or causes demonstrated prejudice. Where the notice communicated scrutiny selection, was timely issued and served, and permitted effective participation, a format deviation is a curable procedural defect. Section 292B preserves a notice that substantially fulfils the statutory purpose of initiating scrutiny and allowing substantiation of the return.

Charitable status under section 12AB depends on a trust's dominant objects and actual activities, not an isolated, dormant temple-maintenance clause. Stray-cattle protection, gaushala operations, and care for abandoned and infirm cows were treated as charitable public-welfare activities, supporting registration. Disseminating Bhagavad Gita teachings on ethical conduct, selfless action, discipline, compassion, duty and social welfare was characterised as promoting universal moral and philosophical values rather than a particular religion. Such programmes supported general public utility and cultural heritage. Section 80G approval could not be denied where religious expenditure was incidental and remained within the statutory ceiling of total income, requiring donor-tax-benefit approval.

Derivative contracts create exposure to price movements without constituting physical inventory, so their notional contract value cannot be treated as closing stock in a capital account. Rectified audited accounts that removed such erroneous entries and prior-year loss adjustments were accepted. Unexplained losses settled in earlier years may be examined only in the years of incurrence or settlement. Section 69 applies to unexplained investments made during the relevant financial year and cannot support an addition based solely on an opening capital balance carried forward from the preceding year. The addition under section 69A was therefore unsustainable, and its deletion was upheld.

Rural agricultural land situated beyond the prescribed municipal distance is not a capital asset where contemporaneous revenue records establish agricultural use and an official, unrebutted expert distance certificate supports its rural character. Enhanced compensation for compulsory acquisition of such land is therefore not chargeable to tax. Interest awarded under section 28 of the Land Acquisition Act is an accretion to and integral part of enhanced compensation, rather than separate income from other sources. Accordingly, where the underlying compensation is non-taxable because the land is not a capital asset, the section 28 interest also remains outside the charge of tax.

Tax-transparent partnership income requires treaty analysis by reference to each partner's residence and taxability. Legal professional services, including lawyers' services, are distinct from managerial, technical or consultancy services and are excluded from fees for technical services under the India-United Kingdom treaty. Accordingly, receipts attributable to partners resident outside the United Kingdom require examination under the treaties applicable to their respective countries of residence, rather than taxation as fees for technical services. Claimed advance-tax and tax-deducted-at-source credits require verification against records before allowance in accordance with law.

Protective and substantive assessments cannot be imposed on the same receipt in the hands of the same taxpayer; the Revenue must select one assessment method. Under the post-1 January 2020 agreement, remote performance from outside India and the absence of employee visits to India did not support a current-year finding of a permanent establishment, so the receipts could not be taxed as business income under Section 44DA. Treaty characterisation as fees for technical services requires a factual finding that technical knowledge or skills were made available for the recipient's independent future use. That issue requires fresh examination of the agreements, service scope, recipient capability, and UK tax treatment.

Transfer-pricing adjustments for intra-group services and fixed-asset purchases were deleted because closely linked international transactions had been benchmarked under an accepted aggregated Transactional Net Margin Method. Selectively segregating intra-group services and assigning a nil arm's length price under the Comparable Uncontrolled Price Method was unsustainable without reliable comparable uncontrolled transactions; evidence also established receipt of services and tangible benefits. Treaty-based relief for dividend distribution tax may be raised as an additional claim in appellate proceedings without filing a revised return where required to determine correct tax liability. The claim was admitted for fresh adjudication after final resolution of the pending substantive legal issue.