S. 14A : Disallowance of expenditure-Exempt income–Investments out of own funds and free reserves not liable for disallowance- 2% of dividend income was disallowed towards administrative expenses. [R. 8D]

S. 4 : Charge of income-tax – Carbon credit -Capital or revenue -Additional ground -Receipt from sale of carbon credit is capital receipt-Not taxable as income – Additional ground was admitted and remanded the matter for verification. [S. 2(24), 80IA(4), 115BBG, 254(1)]

S. 276CC : Offences and prosecutions–Companies–Failure to furnish return would not come in way of criminal prosecution-Sanction–Commissioner empowered to sou moto initiate penalty even if assessing authority is Additional Commissioner-Return of income–Failure to furnish–Omission on part of the AO to impose penalty by itself does not mean default is not willful-Return of Income–Primary responsibility of furnishing return is of Managing Director–Directors also equally responsible for furnishing return. [S.139, 140, 271F, 278B, 279]

S. 271(1)(c) : Penalty–Concealment–Writing off capital work in progress- Penalty not sustainable on disallowance of assessee’s claim of loss–Legislature does not intend to penalize every person whose claim is disallowed.

S. 271(1)(c) : Penalty–Concealment–Not mentioning the specific charge -Ground mentioned in show cause notice would not satisfy requirement of law for levying penalty as charges levied in the notice were not specific-Deletion of penalty is held to be valid. [S. 132, 139, 153A]

S. 271(1)(c) : Penalty–Concealment–On excessive deduction and alleged excess stock-Deletion of penalty is held to be justified [S. 10B]

S. 245D : Settlement Commission-Application–Rejection of an application on the ground that the income disclosed belonged to another entity was a finding of fact and did not call for interference by the High Court. [S.245C, Art. 226]

S. 245D : Settlement Commission-Addition was made by extrapolating the actual production vis a vis the reported production of the current year to the preceding years-Addition on the grounds of sufficient evidence of unaccounted production confirmed-Entire process to be seen for considering 80IB deduction-Writ petition was dismissed on the ground that the issue was very factual and there being no perversity. [S. 132, 153A, 80IB, 245D(4), Art. 226 ]

S. 245D : Settlement Commission – If Settlement Commission is unable to form a decisive opinion to give a definitive finding for rejection of settlement application after initial and preliminary hearing, proceeding to second stage, in which more in-depth scrutiny and verification takes place is the only option- Order of Settlement Commission rejecting the petition was set aside and directed to decide on merits. [S. 132, 245C(1), 245D(2)(C)]

S. 234B : Interest–Advance tax–Refund of warehousing charges paid on seized goods by department was rejected–Cannot claim interest from date when goods were auctioned but entitled to claim interest at 12% p.a. from the date of order passed by the settlement commission till actual payment. [S. 132]