The claim for foreign tax credit on salary taxed in Norway remains subject to verification after Form No. 67 was not filed with the return. The taxpayer is to submit the form and credit details to the Assessing Officer, who must verify the claim and grant the credit if it is in order. Eligibility for the credit remains undetermined.

The doctrine of merger under section 263 bars revision only of matters actually considered and decided on appeal. An appellate direction on the head under which interest is taxable does not determine its quantum. Revision is permissible where interest figures remain unreconciled despite available bank statements, indicating a lack of enquiry. In a reassessment limited to bank deposits and interest, revision for lack of enquiry into hundi collections is unjustified where no material connects those collections to the reassessment and no specific error requiring enquiry is identified.

Distribution fees for access to media content and information products, without rights in intellectual property or the use of equipment, do not constitute royalty under the India-UK tax treaty. Under a principal-to-principal distribution arrangement, such fees are business receipts where there is no transfer of copyright or industrial know-how and no equipment is made available for use. The royalty provisions of the Income-tax Act are also relevant to the assessment.

Reassessment may proceed on relevant prima facie tangible material indicating escaped income; conclusive proof is not required at the reopening stage. Information linking transactions to a suspected provider of bogus invoices may be considered alongside the taxpayer's responses and financial details, with the requisite approval. Adverse investigation material cannot be used in an assessment without giving the taxpayer an opportunity to examine and rebut it. For depreciation claims, invoices, e-way bills, bank records and financial statements may support verification, while a supplier's failure to respond to verification notices and non-production may leave transaction genuineness unverified and the taxpayer's burden of proof undischarged.

Article 7 of the India-USA tax treaty subjects permanent establishment profit attribution to separate rules on specified intra-enterprise service charges, excluding the profit element above actual expense reimbursement. The banking exception for interest does not extend to service charges. Branch management salary is deductible when incurred wholly and exclusively for business; head office payment alone does not trigger section 44C. Transfer-pricing comparability depends on actual functions, assets and risks and contemporaneous data. Earlier-year data must reveal facts capable of influencing the transfer price, while depreciation adjustments require reliable quantification. Segment costs require a functional nexus, rational allocation and no duplication. Head office and centralised service expenditure require separate examination of attribution, arm's length pricing and deductibility. Banking securities held as stock-in-trade may be valued at cost or market value, whichever is lower, if consistently applied.

Foreign tax credit is not barred solely because Form 67 is filed late when the form is on record and the claim is otherwise eligible. Section 90 and the applicable double taxation avoidance agreement provide the framework for relief, while Rule 128 prescribes Form 67. The filing requirement is procedural and directory, rather than a condition that extinguishes the substantive credit claim.

Section 41(1) requires remission or cessation of a trading liability and a resulting benefit in the relevant year. An old credit that remained outstanding during that year cannot be added on account of its write-back and taxation in the succeeding year. Under the project completion method, separate registration and completion of one tower do not justify recognising its sales income separately where the towers form one approved project and receipts are offered to tax upon completion of the whole project. The maintenance charges and GST addition requires fresh determination after a reasonable hearing, given the specific assertion that no opportunity to respond was provided; its merits remain undecided.

Section 92B requires an international transaction to be established before advertising, marketing and promotion expenditure can be subjected to a transfer pricing adjustment. The Revenue must establish an agreement, arrangement or understanding with the associated enterprise; expenditure comparisons or incidental benefits alone do not suffice. The bright line test is not a prescribed method for determining the arm's length price. Reallocated management support costs included in a cost-plus charge must be considered alongside the corresponding service revenue. Section 92(3) restricts the application of transfer pricing provisions where the resulting computation would reduce income chargeable to tax.

Penalty for furnishing inaccurate particulars of income is invalid where satisfaction for that ground is recorded during assessment but the penalty notices specify concealment of income. Section 271(1)(c) of the Income-tax Act, 1961 distinguishes the two grounds, and penalty proceedings must correspond to the satisfaction recorded during assessment. Repeatedly specifying concealment in the notices is not a mere clerical defect curable under section 292B. Natural justice requires a penalty to be imposed only on a charge the taxpayer was called upon to answer.

Section 54F provides a deduction for qualifying investment in residential property, including a proportionate interest in properties jointly allotted to co-owners under a joint development agreement. Entitlement must be assessed individually for each co-owner. Different treatment of co-owners on the same material facts requires a distinguishing factual or legal basis. The deduction for a co-owner's proportionate interest is computed according to the statutory formula.

Interest awarded under Section 28 of the Land Acquisition Act, 1894 is an accretion to the value of acquired land and forms part of enhanced compensation as a capital receipt. Amendments to Section 145A of the Income-tax Act, 1961 do not change that character, so the interest is not taxable as income from other sources.

Prosecution for delayed deposit of tax deducted at source requires a judicious exercise of discretion under applicable CBDT directions, including consideration of reasonable cause and relevant remittances. Payment of the tax, interest and late filing fee before the show-cause notice and the TDS statement filing deadline is relevant to that assessment. The prosecution guidelines also specify periods for sanction and complaint. Prosecution after payment of tax and interest, where applicable guidelines have been disregarded, may amount to an abuse of process.

The character of a subsidy depends on its purpose, rather than solely on its form or the timing of receipt. A sales-tax incentive intended to attract capital investment is a capital receipt even when provided through a sales-tax exemption. The incentive schemes also sought to develop backward areas and core-sector industries and generate employment.

Gains from transferring debenture interest coupon strips held for more than twelve months are treated as long-term capital gains and qualify for deduction under section 54EC. Capital gains treatment applies to investment bonds transferred before maturity. The modified tax treatment under Circular No. 2/2002 applies prospectively to bonds issued after the circular, not retrospectively to bonds issued before it.

Exemption for income from citizen-service centres requires examination of the nature of the activity and the relationship between service charges and costs for the relevant year under Section 2(15). Fees, aggregate surplus or enabling powers alone do not establish that a public utility activity is commercial. If the commercial-activity proviso applies, the applicable receipts threshold must also be examined. Application of income under Section 11 is a separate enquiry; registration does not remove annual scrutiny, and the assessee bears the initial burden of establishing entitlement to exemption.

Approved resolution plans bind government creditors under Section 31 of the Insolvency and Bankruptcy Code, and Section 238 gives the Code priority over inconsistent laws. The clean slate principle protects the successful resolution applicant from pre-plan tax claims excluded from the plan; a reservation for statutory obligations does not revive an excluded income-tax claim. Reassessment provisions address income chargeable to tax that has escaped assessment and cannot be used to pursue the excluded claim or collect evidence against former management or third parties. Other lawful investigative avenues remain available without requiring the resolved corporate debtor to participate in reassessment.

Reassessment proceedings involve an order under Section 148A recording reasons that address the taxpayer's reply. Where the recorded reasons address the reply, a challenge based on its alleged non-consideration does not warrant interference with the notice. The taxpayer can submit a return and supporting documents for the Assessing Officer's consideration, with an appellate remedy available thereafter. The assessment remains to be completed in accordance with law.

Financial hardship raised by an applicant must be considered before an appellate authority rejects a stay application solely for non-payment of a stipulated deposit. Where the required deposit is 20% of the demand, rejection without considering the asserted hardship is unsustainable and requires fresh consideration of the stay application. The underlying statutory appeal remains pending.

An approved resolution plan binds governmental creditors under section 31 of the Insolvency and Bankruptcy Code, while section 238 gives the Code overriding effect. The clean slate principle extinguishes pre-plan tax claims not included in the approved plan, precluding reassessment of the corporate debtor for those claims. Reassessment under sections 147 and 148 of the Income-tax Act addresses income escaping assessment and cannot be initiated against the corporate debtor to gather evidence concerning former management or third parties. Other statutory inquiry powers remain available.

Section 149 distinguishes the ordinary three-year period for reassessment from the extended period, which requires alleged escaped income to meet the prescribed Rs. 50 lakh threshold. Exclusion of specified time and extension of a short residual period cannot be used to invoke the extended period when that threshold is unmet. Section 151 requires the sanctioning authority to independently consider the material, including the taxpayer's reply, the income involved and limitation. Reasons supplied later cannot supplement approval lacking contemporaneous consideration.