S. 37(1) : Business expenditure-Capital or revenue-Current repairs-Steel rolling mill-Expenditure incurred for replacement of steel rolls is revenue expenditure. [S. 31]

S. 28(i) : Business loss-Burden of proof-Search-Order of Tribunal allowing the loss is held to be perverse-Order of Tribunal is set aside.[S. 132, 153A, 254(1)]

S. 14A : Disallowance of expenditure-Exempt income-Not recording of satisfaction-Own funds-Order of Tribunal deleting the addition is affirmed. [R. 8D (2)(ii)]

S. 12AA : Procedure for registration-Trust or institution-Genuineness of activities-Order of Tribunal directing the Commissioner to grant registration is affirmed. [S. 12A]

S. 11 : Property held for charitable purposes – Hospital – Providing medicines and medical aid to needy and poor people – Free distribution of medicines – Tribunal was justified in allowing application of income on account of free distribution of medicines. [S. 133(6)]

S. 4 : Charge of income-tax – Sales tax subsidy – Issue attained finality in assessment year 2002 -03 – Order passed by Tribunal for relevant assessment year was not required to be given effect and order passed by Commissioner (Appeals) was restored. [S. 250]

S. 254(2): Appellate Tribunal-Rectification of mistake apparent from the record – Cash credits –Accommodation entries – Additional evidence – Violation of Rule 46A by CIT(A)- Failure to produce the parties – Assessing Officer should exercise his powers under section 131 of the Act – Assessee cannot be compelled to produce the parties – Order of Tribunal rejecting the miscellaneous application and reversing the order of the CIT(A) is quashed and set aside – CIT(A) is directed to decide the appeal a fresh in accordance with law and following the procedure prescribed as per Rule 46A of the Income -tax Rules , 1962 . [S. 68, 131 , 254(1) , Art . 226 ]

S. 45(3) : Capital gains – Transfer of capital asset to firm –Land – Stock in trade- Transferring the assets at nil value – Revaluation by the Firm and crediting the accounts of the partners in latter years – Addition cannot be made in the hands of the partners in the year of revaluation and crediting in the account of partner – Order of CIT(A) deleting the addition is affirmed . [ S. 45 , 48 , 147, 148 ]

S. 277A : Offences and prosecutions-Falsification of books-or documents etc.-Principal Director of Income-tax (Inv.) filed a complaint against assessee for offences under sections 277A and 278B-Warrant of arrest was issued against assessee-A senior officer of income-tax department was complainant, there would be no requirement of compliance with section 202 of CrPC-Assessee is an artificial person and not a natural person, warrant of arrest could not be issued. [S. 278B, Code of Criminal Procedure, 1973, S. 202, 305]

S. 271(1)(c) : Penalty-Concealment-Violation of principle of natural justice-Show-cause notice issued gave less than 24 hours to assessee to appear-Shorter period of less than 24 hours could be termed as a pure and simple breach of principle of natural justice-Penalty order was quashed and set aside. [S. 274, Art. 226]