S. 43B : Certain deductions on actual payment – The credit of Excise Duty earned under MODVAT scheme is not sum payable by the assessee by way of tax, duty, cess – unutilised credit under MODVAT scheme does not qualify for deduction – Sales tax paid by the appellant was debited to a separate account titled ‘Sales Tax recoverable account’ and is liable for disallowance .[S. 145 ]

S. 69C : Unexplained expenditure – Bogus purchases – Accommodation entries – Restricting the disallowances at 5% of alleged bogus purchases is held to be justified – Entire purchases cannot be disallowed . [ S. 37(1),144 ]

S. 263 : Commissioner – Revision of orders prejudicial to revenue – Provision for expenses – Revision is held to be not valid [ S.37(1) ]

S. 251 : Appeal – Commissioner (Appeals) – Powers – Enhancement – CIT (A) cannot enhance a new source of income to tax which was not considered by assessee. [ S.68, 147, 251(2), 263 ]

S. 234B : Interest – Advance tax – Book profit – Retrospective amendment to provision of S. 115JB- Not liable to pay interest .[ S.115JB ]

S. 115JB : Book profit – Liabilities of gratuity and leave encashment -Notes appended to accounts- Should be adjusted while computing book profit- Adjustment in respect of prior period items comprising of impact of lease rent equalization and gratuity expenses of earlier years should be made, while computing book profit- Exempt income – Disallowance is not considered while computing book profit- Dividend income is exempt ,should be excluded in computing book profit .[ S. 10(34 )14A, 145 , R.8D AS. 15 ]

S. 115JB : Book profit – Sales tax subsidy- Capital in nature – A receipt exempt from tax under Income tax law, cannot be considered for purpose of computation of book profit- Sales tax subsidy received by assessee being capital in nature is to be reduced from book profit [ S.4, 28(i) ]

S. 92B : Transfer pricing – Safe Harbour Rules (5 per cent variation) – No TP adjustment could be made where arm’s length value of transactions as computed by TPO was within permitted range of variation of +/- 5 per cent of actual value of transaction. [ S.92C ]

S. 73 : Losses in speculation business – Business in trading in shares – Business loss -Delivery based transactions – Derivates transactions in futures and options segment- Explanation to section 73 does not differentiate between ‘delivery based transactions’ and ‘derivative transactions in F&O segment’ and same applies to entire business of purchase and sale of shares, whether such trading is delivery based or non-delivery based and, whether there is profit or loss from such business .[ S.28(i) ]

S. 57 : Income from other sources – Deductions – Interest paid on borrowed money- Advanced to earn interest – Though no interest is earned on money lent ,interest paid is allowable as deduction .[ S.56 , 57(iii) ]