Tag Archives: DCIT

Trust registration cannot be cancelled for financial irregularities without deviation from core charitable objects.

By | July 9, 2026
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Trust registration cannot be cancelled for financial irregularities without deviation from core charitable objects. Issue Whether the PCIT can legally cancel a trust’s tax registration under Section 12AB(4) by invoking clauses (a) and (e) of the Explanation for financial irregularities/related-party benefits under Section 13(3), when the trust continues its genuine charitable activity of imparting education… Read More »

Reassessment under Section 147 is valid if third-party seized material does not directly belong to assessee.

By | July 7, 2026
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Reassessment under Section 147 is valid if third-party seized material does not directly belong to assessee. Issue Whether the Assessing Officer can validly initiate reassessment proceedings under Section 147 based on independent investigation of third-party search data, where the seized material does not directly belong, pertain, or relate to the assessee, thereby rendering the special… Read More »

Section 153C assessments are invalid for excluded block periods and unabated years lacking incriminating material.

By | July 4, 2026
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Section 153C assessments are invalid for excluded block periods and unabated years lacking incriminating material. Issue Issue 1: Whether the block of six assessment years under Section 153C must be reckoned from the deemed date of search (the date the satisfaction note is recorded), thereby excluding years that fall outside this newly calculated window. Issue… Read More »

Functionally dissimilar entities, entrepreneurs, and product developers are invalid comparables for captive IT service providers.

By | June 25, 2026
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Functionally dissimilar entities, entrepreneurs, and product developers are invalid comparables for captive IT service providers. Issue Whether the Transfer Pricing Officer (TPO) was justified in including functionally dissimilar companies, full-fledged entrepreneurs, and product developers in the final list of comparables for a captive service provider, and whether the ad hoc disallowance of repair and maintenance… Read More »

Quantified liabilities, documented payments, and reconciled books cannot be disallowed on a purely ad hoc basis.

By | June 25, 2026
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Quantified liabilities, documented payments, and reconciled books cannot be disallowed on a purely ad hoc basis. Quantified liabilities, documented payments, and reconciled books cannot be disallowed on a purely ad hoc basis. Issue Whether the tax authorities can validly disallow quantified business liabilities, depreciation claims, actual statutory payments, reconciled sales turnover, and staff welfare expenses… Read More »

Revenue cannot force POCM over consistently accepted Project Completion Method, nor make additions for interest-free advances backed by own interest-free funds.

By | June 19, 2026
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Revenue cannot force POCM over consistently accepted Project Completion Method, nor make additions for interest-free advances backed by own interest-free funds. Issue Whether the tax authorities can unilaterally replace an consistently followed Project Completion Method with the Percentage of Completion Method (POCM), disallow interest under Section 36(1)(iii) despite the availability of interest-free funds, invoke Section… Read More »

ESOP discount is an ascertained business expenditure under Section 37(1), and no Section 14A disallowance can be made if no exempt income is earned.

By | June 19, 2026
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ESOP discount is an ascertained business expenditure under Section 37(1), and no Section 14A disallowance can be made if no exempt income is earned. Issue Whether the discount on the issuance of Employee Stock Option Plans (ESOPs) is an allowable business expenditure under Section 37(1) rather than a national or contingent liability, and whether a… Read More »

Reassessment Issued by an Officer Lacking Pecuniary Jurisdiction Under CBDT Instructions Is Void and Liable to Be Quashed

By | June 18, 2026
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Reassessment Issued by an Officer Lacking Pecuniary Jurisdiction Under CBDT Instructions Is Void and Liable to Be Quashed Issue Whether a reassessment notice under Section 148 and the consequential assessment order are legally valid if they are issued by an Assistant Commissioner of Income Tax (ACIT) who lacks the pecuniary jurisdiction specified under binding CBDT… Read More »