S. 92C : Transfer pricing – Comparable – The categorical finding of fact by the ITAT that a comparable (Motilal Oswal) is engaged in a qualitatively different and diversified business than that of the assessee cannot be challenged as a substantial question of law as the finding is not perverse or vitiated by any error apparent on the face of the record.[ S 92CA,.260A ]

S. 276C : Offences and prosecutions – Wilful attempt to evade tax- The burden of proving the absence of mens rea is upon the accused and such absence needs to be proved not only to the basic threshold of “preponderance of probability” but “beyond reasonable doubt”. In every prosecution case, the Court shall always presume culpable mental state and it is for the accused to prove the contrary beyond reasonable doubt. This presumption is a rebuttable one- Petition to quash the proceedings was dismissed .[ S.133A, 271(1) (c ), 277, 278E, Cr.P.C. S.561A ]

S. 254(2A):Appellate Tribunal –Stay- Penalty – The assessee has made out a prima facie case that the outcome of the appeal before the ITAT will directly impact the penalty proceedings which are hurriedly being finalized by the authorities which may entail huge liability by way of penalty on the assessee. The Revenue authorities are accordingly restrained from passing any order imposing penalty on the assessee so long as the appeal is pending before the Tribunal. [ S. 206AA,271C ]

S. 254(2):Appellate Tribunal-Rectification of mistake apparent from the record –Bogus share capital- The ITAT is an adjudicator and not an investigator. It has to rely upon the investigation / enquiry conducted by the AO. The Dept cannot fault the ITAT’s order and seek a recall on the ground that an order of SEBI, though available, was not produced before the ITAT at the hearing. The negligence or laches lies with the Dept and for such negligence or laches, the order of the ITAT cannot be termed as erroneous- Rectification application of the department is dismissed .[ S.68]

S. 197 : Deduction at source – Certificate for lower rate –Only the concerned official has to record his satisfaction while issuing the TDS certificate-No functionary other than the officer referred to in the relevant statutory provision, namely S. 197 and Rule 28AA of the Income Tax Rules, 1962, is permitted to take over the jurisdiction or interfere in the exercise of the discretionary power envisaged by this statutory provision. [ R.28AA]

S. 153A : Assessment –Reamnd by Tribunal- Search-Limitation-The time limit of 2 years u/s 153B for framing search assessment orders applies only to the original order and not orders passed after remand-. Period of limitation prescribed for completion of remand (nine months) constituted a special provision, which applies to every class of remand regardless whether they originate from assessments/re-assessments/revisions or search and seizure assessments.-The time limit for passing remand orders is governed by S.153(3)/ erstwhile 153( 2A) & not by S. 153B- Limitation begins (for any purpose under the Act) from the point of time when the departmental representative receives the copy of a decision or an order of the ITAT- The last date by which the remand order could have been worked out validly was 31.12.2016. Accordingly the impugned order pursuant to the remand dated 22.12.2017 and all consequential orders and actions are hereby quashed. [ S.153(2A), 153B, 254(1) ]

S. 147: Reassessment – The information given by DIT (Inv) can only be a basis to ignite/ trigger “reason to suspect”. The AO has to carry out further examination to convert the “reason to suspect” into “reason to believe”. If the AO acts on borrowed satisfaction and without application of mind, the reopening is void .[ S. 92, 148 ]

S. 143(2): Assessment –Notice- Additional ground- Jurisdictional issue –Admitted – A notice u/s 143(2) issued by the AO before the assessee files a return of income has no meaning- If no fresh notice is issued after the assessee files a return, the AO has no jurisdiction to pass the reassessment order and the same has to be quashed [ S.147, 148 , 254(1)]

S. 80IC: Special category States – Manufacture of watches -Assembling will amount to manufacture – Allegation of the Dept that manufacture is not possible as the assessee has less number of employees, no sophisticated machinery and less electricity consumption cannot be the ground to reject the claim of the assessee.

S. 68: Cash credits- Bogus share capital-If (a) the assessee has furnished the Name, Address, PAN no and Share Application Form to prove that the shares were allotted to the applicants and (b) the bank statement show that money was received through banking channels and there were no immediate withdrawals to suggest that the share application amounts have been returned back to these parties in cash, it means the assessee has discharged the primary onus cast upon it to prove the identity, capacity and genuineness of transactions- Additions can not be made as cash credits.