Section 12AB registration rejected for alleged non-submission of information requires a proper opportunity to furnish the material, particularly where charitable character and registration history are established. Subsequent registration may operate from the date of the original application. Once charitable objects and genuine activities are accepted, registration should not be made conditional on prospective compliance measures concerning commercial receipts or updating of returns; any cancellation must follow the prescribed legal process. Approval under section 80G requires fresh consideration on relevant material and after a proper hearing where section 12AB registration has been directed from the original application date.

Faceless reassessment under the Income-tax Act required a notified scheme governing assessment, reassessment, or recomputation of escaped income. The e-Assessment of Income Escaping Assessment Scheme, 2022, was notified only after the reassessment in question had been completed. Earlier faceless-assessment arrangements did not extend to reassessment proceedings. The Faceless Assessing Officer therefore lacked jurisdiction to complete the reassessment before the notified scheme took effect, and the reassessment was quashed.

Jurisdictional defects in reassessment initiation may be examined collaterally in revision proceedings to test whether the underlying order has a legally sustainable foundation; participation, waiver, acquiescence, or failure to appeal cannot validate an inherent lack of jurisdiction. Where reassessment is initiated after the prescribed period, approval from the specified authority under section 151(ii) is a condition precedent. Approval under section 151(i), an office-holder's description, or subsequent departmental communication does not establish compliance. Revisionary jurisdiction under section 263 requires both error and prejudice and cannot cure invalid sanction or create lawful prejudice from defective reassessment proceedings.

Valid service of a jurisdictional notice under Section 148 is essential to commence reassessment. Service by affixture requires due diligence in attempting ordinary service, reliable witness verification, and affixture at the correct premises under the substituted-service requirements in Rules 17 to 20. Sending notice to an address different from the residential address in the registered sale deed, without satisfying those requirements, invalidates service. Participation in assessment proceedings does not cure invalid service under Section 292BB. Consequently, invalid service prevents reassessment jurisdiction under Section 147 from arising.

Accrual under section 145 arises only when a contractual reimbursement entitlement is ascertainable; later reconciliation of deposit liabilities is therefore recognised in the subsequent period. Under the mercantile system, prior-period expenses become deductible on identification, quantification and crystallisation, subject to the sustained residual disallowance. Genuine expenditure for business promotion, agency operations, reimbursed group expenses and depositor-grievance redressal is deductible, though reasonable restrictions may apply to celebratory or personal elements. NBFC-based limits do not restrict a partnership firm's substantiated agency commissions and incentives. Consumables and replacement UPS batteries are revenue expenditure, whereas communication equipment is capital. Unremitted public deposits held for transmission to a principal are not loans or advances and do not constitute deemed dividend.

Section 56(2)(x) permits use of the stamp duty value prevailing on an agreement date instead of the registration date where the dates differ, but only if consideration, or part of it, was paid on or before the agreement date through an account-payee cheque or prescribed banking channel. Application of this proviso requires verification of the Banakhat dates, their connection with the registered sale deeds, and evidence of cheque presentation, encashment, bank entries, accounting records and receipts. Agreement-date valuation applies only when the statutory payment condition is established.

Section 80-IA may cover a separately identifiable telecom undertaking operating under an independent licence, with audit certification by an independent Chartered Accountant. Functionally integrated digital switching equipment, commercial-use rights and goodwill acquired with a business may qualify for depreciation; block-of-assets depreciation is not reduced for book impairment absent a statutory adjustment. Interest on temporary business funds retains business-income character, while further exempt-income disallowance cannot arise where no exempt income exists. Refund interest runs until actual payment, and substantiated TDS credit may be allowed despite Form 26AS omission. Transfer-pricing benchmarks require currency-specific comparables for foreign-currency loans and supportable comparable rates for guarantees, comfort or support letters, and delayed receivables.

Reassessment under sections 147, 148 and 148A requires credible information with a live link to alleged income escapement and independent application of mind. An anonymous, unverified tax-evasion petition alleging undisclosed immovable-property investment cannot meet that jurisdictional threshold where it lacks particulars of the properties, valuation, acquisition, payment source, or investment beyond recorded books. Independent material is necessary to convert vague allegations into credible grounds for reopening; absent it, reassessment initiation and consequential assessment are invalid.

Transactional Net Margin Method benchmarking for administrative support services requires comparables to be functionally similar and capable of meaningful comparison after considering scale, risk profile, intangibles, brand value, service nature and financial stability. Entities with substantially higher turnover, diversified or high-end services, significant intangible or brand advantages, abnormal or volatile results, or functional differences must be excluded. Web-based software development and high-end analytical and research service providers were unsuitable. After their exclusion, the remaining comparable margins were lower than the tested party's margin, so no upward transfer-pricing adjustment was warranted.

Embezzlement and misappropriation losses suffered by a charitable institution are allowable where special-audit findings and a first information report substantiate fabricated records, unauthorised use of fixed deposits, and diversion of funds or blood stock. The material consideration is the institution's conduct and evidence establishing the embezzlement, rather than the eventual result of criminal proceedings. Losses caused by persons managing the institution are treated as absolute and irrecoverable on the established facts, and cannot be characterised as benefits extended to specified persons.

For the relevant pre-amendment period, section 194B applied its withholding threshold to each individual winnings payment rather than aggregated payments; disallowance under section 40(a)(ia) also requires an identifiable expenditure and withholding default. Deposit-linked and referral bonuses granted on promotional conditions are not winnings merely because recipients participate on an online gaming platform. CSR expenditure excluded from business-expense deduction under section 37(1) may nevertheless qualify under section 80G where the statutory conditions, including donee eligibility, are met. Employee Stock Option Plan expenditure follows established allowable treatment absent distinguishing facts. Total-income computation requires verification of all operative assessment, appellate, and rectification orders.

Reassessment cannot be used to review foreign-remittance deductions already examined in the original assessment on the same disclosed material, without new tangible material indicating escaped income; reopening on that basis is invalid as a change of opinion. A pending appeal concerning tax-deduction default proceedings does not bar a reassessment disallowance, because those proceedings concern tax collection while disallowance concerns income computation. The same expenditure cannot be disallowed twice, requiring verification of alleged arithmetical errors, including tax-deducted amounts and expense reversals. Claimed carry-forward losses also require verification against assessment records before determination.

Motor cars held for personal use are excluded from the definition of capital assets under the Income-tax Act, except for specified exceptions that do not cover motor cars. Actual use determines an asset's character, rather than its classification as a fixed asset in the balance sheet. Where no depreciation is claimed, vehicle expenses are disallowed as personal, and no business use exists, sale of the car cannot generate an allowable long-term capital loss.

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.