Assessment under section 153C is void if the satisfaction note is recorded after April 1, 2021. Issue Whether the assessment orders framed under Section 153C for the assessment years 2013-14 and 2014-15 are legally valid, given that the Assessing Officer’s satisfaction note was recorded after April 1, 2021, shifting the deemed date of search for… Read More »
Cash deposits are fully explained by a co-owner’s accepted advance and verified bank withdrawals Issue Whether a Section 69A addition for unexplained cash deposits totaling ₹48 lakhs can be sustained when a co-owner’s tax proceedings have already validated the primary source of the funds and the remaining deposits are backed by documented bank withdrawals. Facts… Read More »
Foreign exchange gains are operating income, and expense allocation must follow gross profit margins Issue Whether the Transfer Pricing Officer (TPO) is legally justified in treating business-related foreign exchange gains as non-operating income, modifying common expense allocations from gross profit to turnover basis, and eliminating comparables without persistent losses under the Transactional Net Margin Method… Read More »
Additions for notional interest, ad-hoc expenses, and trade payables are invalid after favorable remand report Issue Whether the Assessing Officer can sustainably maintain tax additions for notional interest on subsidiary loans, ad-hoc expense disallowances, and unexplained trade payables when the revenue’s own remand report subsequently accepts the assessee’s explanations without any adverse remarks. Facts The… Read More »
Unsecured Loan Additions Deleted upon Proving Source and Transfer Pricing Issues Remanded for Fresh Verification Unsecured Loan Additions Deleted upon Proving Source and Transfer Pricing Issues Remanded for Fresh Verification Issue Whether an addition under Section 68 can be sustained when the assessee provides comprehensive proof of the lender’s identity, creditworthiness, and source of funds.… Read More »
Assessment framed by an officer lacking jurisdiction without a Section 127 transfer order is void. Issue Whether an assessment order passed under Section 143(3) by an Assessing Officer at New Delhi is legally sustainable when jurisdiction over the assessee vest with the Assessing Officer at Mumbai, and no formal transfer order under Section 127 was… Read More »
Compensatory interest, zero-exempt-income Section 14A disallowance, 80G CSR deductions, and workforce depreciation are allowed. Issue Whether interest paid on a delayed license migration fee is a deductible revenue expenditure. Whether a disallowance under Section 14A can be made when the assessee earns no exempt income during the year. Whether corporate social responsibility (CSR) expenditure paid… Read More »
The Commissioner (Appeals) can validly set aside an ex-parte reassessment and remand it for fresh adjudication. The Commissioner (Appeals) can validly set aside an ex-parte reassessment and remand it for fresh adjudication. Issue Whether the Commissioner (Appeals) [CIT(A)] is legally empowered under Section 251(1)(a), read with the statutory proviso inserted via the Finance Act, 2024,… Read More »
Valid Advance Pricing Agreements bind the Revenue, precluding alternative business expenditure disallowances under Section 37(1). Issue Whether the tax department can alternatively disallow an expenditure under Section 37(1) of the Income-tax Act after the underlying international transaction has already been covered, verified, and accepted under a binding Advance Pricing Agreement (APA) under Section 92CC. Facts… Read More »
Disallowance under Section 36(1)(iii) must reflect actual interest paid, while verified loans defeat Section 68 additions. Issue Whether the lower authorities were justified in making a massive interest disallowance under Section 36(1)(iii) without correlating the disallowance to the actual interest expenditure incurred on loans diverted for interest-free advances. Whether an addition under Section 68 for… Read More »