Daily Archives: September 11, 2026

Reopening assessment beyond four years is invalid without establishing assessee’s failure to disclose material facts.

By | September 11, 2026
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Reopening assessment beyond four years is invalid without establishing assessee’s failure to disclose material facts. Reopening assessment beyond four years is invalid without establishing assessee’s failure to disclose material facts. Issue Whether reopening an assessment under Section 147 after four years from the end of the relevant assessment year is valid when reasons recorded rely… Read More »

Capital gains from building redevelopment belong to members, making additions under society’s PAN unjustified.

By | September 11, 2026
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Capital gains from building redevelopment belong to members, making additions under society’s PAN unjustified. Issue Whether capital gains arising from a building redevelopment contract executed by a cooperative housing society can be taxed in the hands of the society merely because transactions were registered under its PAN, when rights and consideration belong exclusively to individual… Read More »

Temporary site-specific infrastructure expenditure for contract execution constitutes allowable revenue expenditure under Section 37(1).

By | September 11, 2026
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Temporary site-specific infrastructure expenditure for contract execution constitutes allowable revenue expenditure under Section 37(1). Issue Whether expenditure incurred on site-specific and temporary items like rollers, structures, scrap rails, conveyor belts, and ventilation ducting for executing a civil EPC contract is allowable as revenue expenditure under Section 37(1) or must be treated as capital expenditure providing… Read More »

Reopening assessment based on issues fully queried and accepted during original scrutiny constitutes an impermissible change of opinion.

By | September 11, 2026
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Reopening assessment based on issues fully queried and accepted during original scrutiny constitutes an impermissible change of opinion. Reopening assessment based on issues fully queried and accepted during original scrutiny constitutes an impermissible change of opinion. Issue Whether initiating reassessment proceedings under Section 147 read with Section 148 on issues that were explicitly queried, examined,… Read More »

Transfer pricing adjustments apply strictly to AE transactions, requiring fresh verification of turnover and operating cost filters.

By | September 11, 2026
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Transfer pricing adjustments apply strictly to AE transactions, requiring fresh verification of turnover and operating cost filters. Issue Whether transfer pricing adjustments under Chapter X must be restricted solely to international transactions with Associated Enterprises (AEs) rather than entity-level operations. Whether arbitrary application of a turnover filter (50% range) and exclusion/inclusion of non-recurring operating costs,… Read More »

Closing stock accepted in preceding year automatically constitutes opening stock for subsequent year.

By | September 11, 2026
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Closing stock accepted in preceding year automatically constitutes opening stock for subsequent year. Issue Whether the Assessing Officer was justified in revaluating the opening stock as on 01.04.2013 and disallowing interest on an undisputed outstanding credit carried forward from the preceding year without rejecting the books of account under Section 145. Facts Stock Valuation Issue:… Read More »

Statutory limits on contributions do not apply to extraordinary payments bridging actuarial fund deficits.

By | September 11, 2026
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Statutory limits on contributions do not apply to extraordinary payments bridging actuarial fund deficits. Issue Whether the statutory ceiling limits under Rule 87 (for superannuation funds) and Rule 103 (for gratuity funds) apply to extraordinary, ad-hoc contributions made by an employer solely to bridge actuarial deficits and ensure fund solvency. Facts Superannuation Contribution: For AY… Read More »

Transfer pricing adjustments apply strictly to associated enterprise dealings, with profit margins determined by operational items.

By | September 11, 2026
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Transfer pricing adjustments apply strictly to associated enterprise dealings, with profit margins determined by operational items. Issues Whether Transfer Pricing (TP) adjustments under Chapter X can be applied at the entity level or must be restricted strictly to international transactions with Associated Enterprises (AEs). What principles govern the inclusion or exclusion of specific income and… Read More »

Absence of objective dissatisfaction under Section 14A(2) precludes Assessing Officer from applying Rule 8D.

By | September 11, 2026
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Absence of objective dissatisfaction under Section 14A(2) precludes Assessing Officer from applying Rule 8D. Issue Whether the Assessing Officer was justified in rejecting the assessee’s suo motu disallowance under Section 14A and invoking the formula prescribed under Rule 8D without recording objective dissatisfaction with the correctness of the assessee’s accounts and computation. Facts The assessee… Read More »

CIT(E) must evaluate reasonable cause to condone delay in filing Form 10AB for registration.

By | September 11, 2026
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CIT(E) must evaluate reasonable cause to condone delay in filing Form 10AB for registration. Issue Whether the CIT(E) was justified in rejecting an application for regularization of provisional registration (Form 10AB) solely on the ground of limitation without considering the statutory power to condone delay under Section 12A(1)(ac). Facts The assessee, a charitable trust/institution, was… Read More »