S. 271AAB : Penalty-Search initiated on or after 1st day of July 2012-Undisclosed income–Surrender of long term capital gain- income – Would not ipso facto be regarded as undisclosed income unless and until it is tested as per definition provided in Explanation to section 271AAB of the Act – Order of penalty is quashed. [S. 45, 132(4), 153A, 275]

S. 115JA : Book profit – Provision for wealth-tax could not be included for purposes of computation of book profit.

S. 80G : Donation–Paid through bank and receipt in the name of assessee-Held to be allowable as deduction.

S. 56 : Income from other sources – Excess share premium- second level subsidiary of a company in which public are substantially interested – Addition cannot be made. [S. 2(18), 2(24), 56(2)(viib), R. 11UA]

S. 54F : Capital gains- Investment in a residential house–Property was co-jointly owned in name of wife–Could not be treated as absolute owner–Exemption cannot be denied. [S. 45]

S. 40A(2) : Expenses or payments not deductible–Excessive or unreasonable-Interest paid for outstanding credit balance-No interest was charged from debtors- Interest paid could not be disallowed.

S. 37(1) : Business expenditure-Discounts to customers who purchases the medicine from C& F agents-Direct bearing on potential turnover of company-expense would fall within expression wholly and exclusively for purpose of business- Allowable as business expenditure.

S. 14A : Disallowance of expenditure-Exempt income-Difference between value of actual investment and value as on balance sheet is not dividend income- Addition cannot be made. [R. 8D]

S. 14A : Disallowance of expenditure-Exempt income-Interest free funds available-Presumption that interest free funds for investments yielding tax free income in preference to borrowed funds-Disallowance of expenditure cannot exceed exempt income. [R. 8D]

S. 11 : Property held for charitable purposes–Application of income-Capital gains-Sale of bonds and debentures- Failure to disclose investment made by way of purchase of mutual fund- Deduction is not allowable from capital gains–Accumulation of income- Failure to file any details with regard to availability of funds for making investment in modes specified under section 11(5), claim could not be allowed. [S. 11(5), 45]