S. 68 : Cash credits- Bogus share capital/ premium-The Assessee is under legal obligation to prove the receipt of share capital/premium to the satisfaction of the AO, failure of which, would justify addition of the said amount to the income of the Assessee- Mere mention of income tax file number of an investor is not sufficient to discharge the onus -Credit worthiness of the investor companies was not discharged -Order of AO is confirmed .

S. 254(1) :Appellate Tribunal – Additional ground – validity of the assessment can be challenged at any time as it goes to the root of the matter and is a legal issue.

S. 143(3) : Assessment – Assessment of amalgamating company-Notices were issued prior to the amalgamation with another company – Assessment proceedings cannot be held to be invalid [ S.142(1) 143(2) ]

S. 43B : Deductions on actual payment – Provision for leave encashment- Not allowable unless the amount is actually paid .

S. 40(a)(i) : Amounts not deductible – Deduction at source -Non-resident – Amount not claimed as expenditure- No disallowance can be made – Exemption certificate for non deduction of tax at source- Once certificate has been issued no disallowances can be made – If income is not chargeable to tax in India -No disallowance can be made- Once it is held that income is not chargeable to tax in India, no disallowance can be made. [ S.195 , 197 ]

S. 37(1) : Business expenditure –Brand building – Advertisement expenses- Held to be revenue expenditure

S. 22 : Income from house property – letting out of its permanent structured on regular basis is assessable as income from house property – Receipt of license fee for use of craft stalls organized with object of promoting tourism, is taxable as business income [ S.28 (i) ]

S. 276CC : Offences and prosecutions-Failure to furnish return of income – Superior authority can also sanction prosecution–Imposition of penalty under Section 271F by AO not a pre-requisite for sanctioning prosecution –MD and other directors equally responsible for non-fling of return and hence other directors are also at default. [S. 271F, 278BB, 279]

S. 260A : Appeal-High Court-Maintainability-Small tax effect—the “tax effect” is much less than Rs. 20,00,000 for all the assessment years taken together and no material on record to show that the present appeals filed by the Revenue have any cascading effect—Therefore, the appeals are dismissed as withdrawn.

S. 254(2) : Appellate Tribunal-Rectification of mistake apparent from the record – Non consideration of case laws cited by Assessee during the hearing by Tribunal-Impugned order passed by the Tribunal dismissing the Assessee’s Miscellaneous Application as well as the Appellate order are set aside. [S. 254(1)]