S. 154 :Rectification of mistake – Mistake apparent on the record must be an obvious and patent mistake – It should not require a long drawn process of reasoning where there may be conceivably two opinions – ITO was incompetent to pass orders under section 154 of the Act to rectify the assessment. [ Indian Income-tax Act, 1922 ,S.17(1) ]

S. 153C: Assessment – Income of any other person – Search and seizure – Complying with the requirement of recording of satisfaction is mandatory – If AO of the searched person and the other person is same, a single satisfaction note prepared by the AO stating that documents seized belonged to the other person and not the searched person would tantamount to complying with the mandatory requirements of section 153C. [S.132(1), 133A , 158BD]

S. 147: Reassessment-Change of opinion-Deduction was allowed in the original assessment- on the same facts to hold that the excess deduction was allowed will be change of opinion-therefore, reassessment was held to be bad in law. [S. 10A,148]

S. 145: Method of accounting – Valuation of inventories – Finished goods – Goods valued below cost – Stock in trade- Rejection of method of valuation is held to be justified .

S.145: Method of accounting – A person cannot make a profit from himself- Revaluation is not taxable event. [S.4 , Indian Income -tax Act, 1922, S.13]

S.144: Best Judgment Assessment – Bogus purchases – Unregistered dealers –Addition of alleged bogus purchase creditors after rejection of books of account – assessee brought on record, where CIT(A) in penalty appeal proceedings affidavits of 13 unregistered dealers out of whom 12 were examined by the Officer, accepted the explanation of assesssee that said creditors are genuine and accordingly deleted the penalty under section 271(1)(c) of the Act. That The dealers stood by the assertion made by the assessee about the purchases on credit from them-Held Factual basis on addition was made in quantum proceedings stands dispelled by the affidavits and statements of the concerned unregistered dealers in penalty proceedings- Addition cannot be justified, much less, sustained (Other contentions raised by assesse not adjudicated)- Addition is held to be not justified . [ S.68 , 271(1) (c ) ]

S. 144: Best judgment assessment-Arbitrary-Honest and fair estimate.[ S.145(3) ]

S.143(3) : Assessment – Affidavit – When a statement is given in affidavit the same is proved to be correct unless proved otherwise [S.69A, High Denomination Bank Notes (Demonetisations) Ordinance, 1946, Indian Income-tax Act, 1922, S.23 ]

S.143(3): Assessment – Principle of res-judicata- Strictly Res judicata does not apply to income tax proceedings. However, where a fundamental aspect permeating through different assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order it would not be at all appropriate to allow the position to be changed in a subsequent year [S. 11, 12 ]

. 143(3): Assessment-Natural justice -Denial of opportunity to cross examine witness-Failure to give the assessee the right to cross-examine witnesses whose statements are relied upon results in breach of principles of natural justice. It is a serious flaw which renders the order a nullity. [Central Excise Act, 1944, S.3, Rules 1944, R. 173C)