Advance Authorisation imports of natural rubber are exempt from the port restrictions imposed by Notification No. 32/2015-2020 under Notification No. 11/2015-2020. Following in-principle approval to exit the EOU Scheme, the importer obtained an Advance Authorisation under the Foreign Trade Policy, 2023, enabling imports through Hazira Port. These subsequent approvals were relied on as rendering the challenge to the port-restriction notification unnecessary. The notification's validity had previously been upheld in separate proceedings.

Disallowance under section 40(a)(i) for payments to foreign related entities requires verification of the payments' nature, underlying arrangements, reimbursement and invoicing model, treaty taxability, and whether withholding tax under section 195 applies; absent this examination, fresh adjudication is required. For a debt-free assessee, a separate transfer-pricing adjustment for notional interest on overdue receivables from associated enterprises is unwarranted under the applicable Tribunal precedent and should be deleted. The withholding-tax issue remains subject to factual and legal determination, while the notional-interest adjustment is eliminated.

Transfer-pricing adjustment for notional interest on delayed realisation of receivables from an associated enterprise is unsustainable where the taxpayer is debt-free. A balance-sheet and financial-account review showing no internal or external borrowings establishes that overdue receivables create no incremental financing or working-capital burden. Application of the debt-free-entity principle therefore precludes imputing notional interest, resulting in deletion of the adjustment.

Penalty under Section 270A is unsustainable for a disallowed education-cess deduction claim that was bona fide when made, supported by prevailing judicial precedent, and fully disclosed. Retrospective disallowance of surcharge or cess does not by itself establish under-reporting or misreporting. Section 155(18) provides a beneficial recomputation mechanism to avoid penal consequences; where its prescribed form and procedure were not notified, the assessee had reasonable cause for not invoking that saving proviso. The education-cess penalty is therefore deleted.

Bogus-purchase disallowance may be confined to the estimated gross-profit component where full disallowance is not warranted on the facts. In reassessment proceedings under the Income-tax Act, the accepted approach sustained an addition of 3% of the purchase value, representing the estimated gross-profit element, instead of disallowing the entire value of the alleged bogus purchases.

Penalty under section 271(1)(c) is unsustainable merely because an interest claim under section 36(1)(iii) is partly disallowed. Concealment or furnishing inaccurate particulars requires evidence that income was hidden, particulars were incorrect, erroneous or false, or material facts relevant to computation were withheld. Where the interest claim rests on fully disclosed facts and the disallowance is limited in quantum proceedings, rejection of the claim alone does not establish the statutory default; the penalty is liable to deletion.

Rejection of books of account requires a reasonable basis grounded in identified material defects or discrepancies. Where ledger accounts, invoices, cash-book summaries, stock statements, TCS details, excise-duty challans, audited accounts and creditor details disclose no specific mismatch, purchases of controlled and excisable liquor are supported. An estimated gross-profit rate without reference to past results or comparable liquor businesses is unsustainable. Rejection of the accounts and the turnover-based gross-profit addition were therefore not sustained, and deletion of the addition was upheld in favour of the assessee.

Reassessment under sections 147 and 148 cannot be sustained where the interest-income addition that triggered reopening is deleted in first appeal, and the only surviving estimated expenditure disallowance was not part of the recorded reasons. In those circumstances, the foundational basis for reopening fails, rendering the reassessment invalid despite the surviving disallowance.

Agricultural-income and related expenditure claims concerning agricultural farms and a nursery require fresh verification where supporting records were not produced for the relevant year. Earlier-year acceptance of similar claims after production of ownership records, agricultural receipts and expenditure evidence supports allowing the assessee to furnish complete material. Fair play and natural justice require de novo adjudication by the Assessing Officer after verifying the evidence and providing a reasonable opportunity of hearing.

Condonation of delay requires a bona fide sufficient cause explaining the entire period of delay, although the approach should advance substantial justice. Difficulties in obtaining committee approval did not establish sufficient cause for the prolonged delay. Where no application for condonation of delay in filing a return had been made or decided under the applicable statutory mechanism, the impediment created by the belated return remained unresolved. Effective adjudication was therefore considered academic and infructuous, and the delay was not condoned.

Assessment of a non-searched person under Section 153C requires compliance with the six-year limitation period, calculated with reference to receipt of material or recording of jurisdictional satisfaction. Proceedings are time-barred where the relevant assessment year falls outside that period. A recorded satisfaction note is a jurisdictional requirement; mere reference to receipt and perusal of information does not establish valid assumption of jurisdiction. Approval under Section 153D must demonstrate meaningful consideration of draft assessment orders and cannot be mechanical. Failure of limitation, satisfaction, or reasoned approval requirements renders Section 153C proceedings void ab initio.

Section 92CD(3) requires a pending assessment for a year covered by a unilateral advance pricing agreement to be completed in accordance with that agreement after considering the modified return. Where the modified return was filed during pending assessment proceedings and complies with the agreement, the original transfer-pricing adjustment cannot be retained merely because objections concerning covered transactions were withdrawn. The Assessing Officer and Transfer Pricing Officer must give effect to the agreement and modified return while completing the assessment.

For software development services, the employee-cost-to-sales filter applies within a 50%-80% range, requiring a fresh transfer-pricing computation. Companies lacking segmental data, those affected by extraordinary amalgamation, and entities performing programming or consultancy functions outside the relevant segment are excluded from the comparable set. Outstanding trade receivables are international transactions, but an interest adjustment cannot stand where the Comparable Uncontrolled Price method lacks segmental comparable evidence or supporting trends. Working-capital effects on pricing and profitability require fresh examination when determining the arm's length price. The resulting determination uses the revised filter and comparable set, deletes the receivables-interest adjustment, and reconsiders the working-capital adjustment.

Registration under sections 12AB and 80G(5) should not be rejected solely because charitable activities had not commenced when applications were filed where subsequent activity occurred during their pendency and requires verification to assess genuineness. Delay-condonation explanations submitted with Form 10AB require consideration, including available measures under section 119(2)(b). An activity note may satisfy the need for activity-related information, and Darpan registration is not identified as a statutory condition for either registration or approval. A fresh, speaking determination after due verification and a reasonable opportunity of hearing is required.

Possession of land granted to a developer solely to construct residential flats under a development agreement does not constitute a transfer for capital-gains purposes where it is only a development licence. Part performance requires possession under the contract and performance, or willingness to perform, contractual obligations. Without possession of that character, capital-gains charging provisions do not apply, and the related long-term capital-gains addition is deleted.

Section 144C(13) requires a final assessment to be completed within one month from the end of the month in which Dispute Resolution Panel directions are received. In a faceless process, receipt occurs when the directions are uploaded to the designated portal; subsequent internal transmission or later availability to the Assessing Officer does not extend that statutory period. Directions uploaded on 30 December 2025 therefore required completion by 31 January 2026. A final assessment order dated 19 February 2026 was consequently treated as time-barred and void.

Section 69A requires a satisfactory explanation of the nature and source of cash or jewellery found. Disclosed and unrebutted opening cash balances supported by returns and financial records may establish the source where they exceed the cash found; cash is fungible, so physical continuity or identity of currency notes need not be shown. Family wealth-tax disclosures and documented bullion purchases may similarly establish aggregate jewellery availability. Once documented availability exceeds the quantity found, the burden shifts to the Revenue to establish disposal of disclosed assets or an undisclosed acquisition. Conjecture, household-expense assumptions, and item-wise matching demands cannot replace evidence.

Assessment under section 143(3) must be made in the name of an assessee that exists when the order is passed. Where a partnership firm converts into a private limited company and the Assessing Officer is informed before assessment, the firm ceases to be an assessable entity. An assessment subsequently issued in the former firm's name is void because settled principles prohibit assessment of a non-existent entity. The resulting assessment order is liable to be quashed.

Service-tax turnover and income-tax revenue may differ in real-estate projects because service tax applied to advances received, while income under the mercantile system and Percentage of Completion Method is recognised at the relevant stage of project completion. Customer advances remain liabilities until then. Where audited books, financial statements and project-wise workings support recognised revenue, no accounting discrepancy is shown and the books are not rejected, the mismatch is a timing and accounting-basis difference. It cannot be treated as unaccounted turnover or taxable income, supporting deletion of the addition.

Section 271AAB requires undisclosed income to be represented by money, bullion, jewellery, another valuable article or thing, or an entry, document or transaction found during a search. A stock shortage identified by comparing physical inventory with book stock is an absence, not search material. Where alleged unrecorded sales are inferred solely from that shortage and gross profit is estimated without evidence of outside-the-books sales or false expense entries, the estimated profit does not satisfy the statutory definition of undisclosed income. Penalty proceedings remain independent of assessment proceedings, and acceptance of an addition is not conclusive. Strict construction places the burden on the Revenue to establish all statutory conditions; penalty is therefore unsustainable.