S. 9(1)(i):Income deemed to accrue or arise in India –Business connection-Liaison Offices In India is not permanent establishment — Income directly or indirectly attributable to these branches or offices was not taxable in India- DTAA-India Japan [ Art, 5(6) (E ).]

S. 5 : Scope of total income -Accrual of income — Duty drawback is taxable when income has accrued.[ S.4, 145]

Karnataka VAT Act-Strictures-Court is pained by the manner in which the authority has passed the order just ignoring the applicable Notification and throwing it to winds. The said order is nothing less than suffering from malice-in- facts as well as malice-in-law. The responsible officer deserves to pay the exemplary costs of Rs 50000 for passing such whimsical order from her personal resources or by deduction from salary

S. 271(1)(c) Penalty-Concealment –No penalty can be imposed where (i) income is added or disallowance is made on estimate basis, (ii) books of account cannot be produced for reasons beyond control, (iii) disallowance is made as per retrospective insertion of S. 37(1) Explanation & (iv) allegation regarding concealment vs. furnishing inaccurate particulars is vague & uncertain. [ S.37(1) ]

S. 260A: Appeal – High Court – Transfer pricing disputes with regard to exclusion and inclusion of comparables to determine Arm’s Length Price (ALP) would not necessarily give rise to substantial questions of law except if there is perversity of finding or failure to adhere to the settled principles of law while determining comparables.[ S.92C ]

S. 244 :Refund – Interest on refund -Strictures-The Dept should bring some order and discipline to the aspect of granting refunds. All pending refund applications should be processed in the order in which they are received. It is the bounden duty of the Revenue to grant refunds generated on account of orders of higher forums and disburse the amount expeditiously. In the absence of a clear policy, the Courts may impose interest on the quantum of refund at such rates determined by the Court- Registrar of High Court is directed to forward copy of the order to the PCIT and the Chairperson – Central Board of Direct Taxes.[ S.119 ]

S. 9(1)(i): Income deemed to accrue or arise in India – Business connection- Reassessment -A representative assessee represents all income of a non-resident accruing or arising in India directly or indirectly from any business connection in India. It is wrong to contend that the representative assessee is not liable for income which has directly arisen or accrued in India. It is also wrong that if the department chooses to make an assessment of the person resident outside India directly, it cannot assess the agent or representative assessee. The Dept has the choice of proceeding against either- Order of Tribunal is set aside [ S.5, 147,148, 160,163

S. 147 : Reassessment –With in four years-Disclosure in computation – The fact that the AO did not raise specific queries and is silent in the assessment order does not mean there is no application of mind – Reassessment is held to be bad in law .[ S.143(3),148 ]

S. 68: Cash credits – Bogus share capital-Failure by the AO to offer cross-examination of the persons whose statements are relied upon means that no adverse inference can be drawn against the assessee. Dept’s plea for a remand is not acceptable if the assessee has discharged primary onus .

S.28(i): Business loss- Speculation –Tax planning- The fact that the assessee bought and sold shares of groups concerns with a view to book loss and off-set the capital gains from another transaction does not mean that the loss can be treated as bogus if the documentation is in order. The loss cannot be treated as “speculation loss” under the Explanation to S.73 because the shares were held as investments.