Tax TMI

15/10/2026

The Ministry of Finance amends Notification No. 4/2021-Customs (CVD) to extend the countervailing duty on aluminium wire/wire rod (9-13 mm) originating in or exported from Malaysia. The duty is to remain in force up to and inclusive of 23 March 2027, unless revoked, superseded or amended earlier.

15/10/2026

Notification amends the Central Excise exemption table by inserting new entries for 22%, 25%, 27% and 30% ethanol blended petrol, each classified under tariff heading 2710 12 and attracting Nil duty when the blend consists of the specified proportions of duty-paid motor spirit and ethanol and confor...

14/10/2026

CKD motherboard kits made up of discrete electronic and electromechanical components are not classifiable as motherboards under tariff item 8473 30 20 when, at import, they lack the essential character of a finished motherboard and require substantial post-import operations before a functional unit....

14/10/2026

GST, Income Tax, Customs, Import-Export, Corporate Laws, IBC, SEBI, PMLA & Other Updates = Dated: 14 October 2026
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TaxTMI Updates
14 October 2026

In Today's Issue:
Notifications (4)
-notifications | Circulars (3)
-circulars | TMI Short Notes (10)
-notes | Highlights (50)
-highlights | Articles (8)
-articles | News (4)
-news | Forum Discussions (14)
-forum

Notifications

Customs

1. 82/2026 - Dated: 12-10-2026 - Cus (NT)
Customs Tariff (Determination of Origin of Goods under the Free Trade Agreement between India and New Zealand) Rules, 2026
https://www.taxtmi.com/notifications?id=147314

Summary: Preferential tariff treatment under the India-New Zealand Free Trade Agreement is available only for originating goods that are wholly obtained or satisfy applicable product-specific origin requirements. Origin may be supported through bilateral cumulation, tariff-classification changes, qualifying value content, or prescribed production processes, while minimal operations do not confer origin. Importers must hold a valid Proof of Origin, comprising a Certificate of Origin or authorised Origin Declaration, and retain supporting records. Customs may verify origin through information requests and verification visits, and may deny preference where origin or compliance cannot be established.
SEZ

2. S.O. 5603 (E) - Dated: 12-10-2026 - SEZ
Central Government notifies the 1.65 hectares area Plot No. 7, Sector Knowledge Park -05, Greater Noida, Gautam Buddha Nagar District, Uttar Pradesh and constitutes an Approval Committee.
https://www.taxtmi.com/notifications?id=147320

Summary: Special Economic Zone designation covers 1.65 hectares at Plot No. 7, Sector Knowledge Park-05, Greater Noida, for Information Technology and Information Technology Enabled Services. Development, operation and maintenance approval followed fulfilment of the relevant statutory requirements. An Approval Committee chaired by the Development Commissioner includes designated departmental and State Government representatives, with the developer represented as a special invitee. From 12 October 2026, the SEZ is deemed an Inland Container Depot under the Customs Act, 1962.
Indian Laws

3. G.S.R. 668(E) - Dated: 27-7-2026 - Info Tech
Ministry of Electronics and Information Technology, Indian Computer Emergency Response Team (Senior Secretariat Assistant and Junior Secretariat Assistant) Recruitment Rules, 2026.
https://www.taxtmi.com/notifications?id=147319

Summary: Recruitment to Senior Secretariat Assistant and Junior Secretariat Assistant posts is regulated as equivalent Group C employment. Senior Secretariat Assistant recruitment requires a bachelor's degree, prescribed computer typing proficiency, language knowledge, and a two-year probation; vacancies are allocated between direct recruitment and promotion, with alternative deputation, absorption, or re-employment where promotion fails. Junior Secretariat Assistant recruitment is solely by direct recruitment and requires 12th-class qualification, the prescribed typing standard, and probation. Marriage disqualification, discretionary relaxation, reservation safeguards, and departmental promotion and confirmation mechanisms apply.
4. G.S.R. 666(E) - Dated: 27-7-2026 - Info Tech
Ministry of Electronics and Information Technology, Indian Computer Emergency Response Team, (Director, Joint Director and Deputy Director) Recruitment Rules, 2026.
https://www.taxtmi.com/notifications?id=147318

Summary: Recruitment to Director, Joint Director and Deputy Director posts follows promotion as the primary method, with deputation, including short-term contract, available where promotion cannot fill vacancies. Direct recruitment is not provided. Promotion requires prescribed feeder-grade service and relevant training, while deputation requires equivalent service, a bachelor's degree and specified administrative, financial or personnel experience. Feeder-category officers cannot seek deputation, and deputationists cannot be considered for promotion. Applicable reservation, age relaxation and concessions remain protected.

Circulars / Instructions / Orders

Customs

1. PUBLIC NOTICE NO. 128/2026 - Dated: 8-10-2026
Removal/Revocation of Alerts in ICES 1.5 for Generation of Eligible RoDTEP Scrolls
https://www.taxtmi.com/circulars?id=71580

Summary: RoDTEP scroll-out is suspended for specified IEC holders whose Annual RoDTEP Return for FY 2023-24 was not filed or reported within the prescribed timeline. ICES 1.5 alerts prevent generation of RoDTEP scrolls for linked Shipping Bills. Exporters must comply with the return requirement and approach DGFT for alert removal or revocation. Once the alert is removed or revoked and reflected in ICES 1.5, Shipping Bills will be processed for scroll generation subject to other applicable conditions and system requirements.
DGFT

2. TRADE NOTICE NO. 30/2026-27 - Dated: 13-10-2026
Simplified procedure for expedited issuance of import authorisations for silver bullion under ITC(HS) 7106
https://www.taxtmi.com/circulars?id=71593

FEMA

3. 27 - Dated: 12-10-2026
Risk Management and Inter-Bank Dealings
https://www.taxtmi.com/circulars?id=71579

Summary: INR non-deliverable derivative contracts offered by Authorised Dealers to non-resident users are restricted to hedging purposes. Authorised Dealers must maintain a Foreign Exchange Risk Reserve for INR foreign exchange derivative contracts undertaken to hedge the currency risk of their own assets and liabilities where foreign currency is purchased against INR. The reserve must equal 20 per cent of the INR equivalent of each contract's notional amount and be maintained as daily cash with the Reserve Bank until contract termination. The requirements apply prospectively.

TMI Short Notes

1. Income Tax : Dependent Agent Permanent Establishment under Article 5(5) of the India-Switzerland DTAA: Authority, Habitual Exercise and Evidentiary Standards
https://www.taxtmi.com/tmi_notes?id=2558

Summary: Dependent agent permanent establishment under Article 5(5) requires proof that an Indian person has authority to negotiate and enter contracts for the foreign enterprise and habitually exercises that authority. Customer liaison, account management, administrative support, communication of pre-approved terms, document routing, and assistance with online standard-form contracting fall short unless Indian personnel substantively determine essential terms or routinely bring negotiations to a binding commercial conclusion. Formal offshore ex*****on is not decisive where local personnel effectively control material negotiations. Corporate association, economic dependence, and independent-agent considerations cannot replace proof of the positive authority and habitual-exercise requirements.
2. Customs : Proper Officer Jurisdiction for Customs Show Cause Notices under Sections 2(34), 17, 28 and 124
https://www.taxtmi.com/tmi_notes?id=2557

Summary: Customs show-cause jurisdiction requires both appointment as an officer of customs and function-specific assignment as the proper officer. Assessment under Section 17 and recovery under Section 28 are distinct functions; the original assessing officer need not alone issue a recovery notice. Retrospective validation of qualifying officers' proper-officer status applies independently of the preserved historical recovery regime. Confiscation and penalty proceedings require written grounds, prescribed prior approval, representation, and hearing. Where jurisdiction exists, disputed facts, evidence, limitation, and procedural compliance ordinarily require determination through adjudication.
3. Money Laundering : Provisional Attachment of Pre-Offence Property as Proceeds of Crime or Equivalent Value under the PMLA
https://www.taxtmi.com/tmi_notes?id=2556

Summary: Pre-offence property is ordinarily not directly derived from later scheduled-offence activity, but may be provisionally attached as equivalent value where actual proceeds are unavailable. Such attachment requires identification and reasoned valuation of the alleged proceeds, material showing their unavailability, and recorded reasons to believe that non-attachment risks concealment, transfer, or other frustration of confiscation. A later use of illicit funds to repay loans, construction borrowing, or secured obligations may separately establish a direct or indirect nexus. Section 24 presumptions do not replace the foundational requirements for attachment.
4. IBC : Disciplinary Suspension of Resolution Professionals Across Ongoing CIRPs: Proportionality, Hearing and Regulation 13(7)
https://www.taxtmi.com/tmi_notes?id=2555

Summary: Where disciplinary misconduct concerns one CIRP, cross-assignment suspension requires a proportionate link to the pleaded charge, supporting material and hearing afforded. Section 220(2) permits disciplinary sanctions after hearing, while Regulation 13(7) requires intimation to Committees of Creditors and the Adjudicating Authority. On the prima facie construction applied, intimation informs each Committee's decision on continuation or replacement rather than automatically removing the professional from unrelated ongoing assignments. The Board's regulatory role and the Committee's replacement power remain distinct but connected.
5. GST : Electronic Authentication of GST Demand Proceedings: Rule 26(3), Sections 75, 160 and 169
https://www.taxtmi.com/tmi_notes?id=2554

Summary: Rule 26(3) makes electronic issuance and authentication by digital signature, e-signature, or a notified verification mode cumulative conditions for GST notices and orders. A portal upload concerns service, while a system-generated reference number, DRC summary, or DIN performs tracking or procedural functions; none independently establishes the authorised officer's authentication. Section 169 governs service rather than validity, and Section 160 does not ordinarily cure a defect preventing attribution of the instrument to the competent officer. DRC-01 cannot replace the statutory notice, and DRC-07 supports recovery only upon a valid order.
6. GST : Large-Scale GST Evasion Prosecutions: Cognizable and Non-Bailable Classification under Section 132 and Its Impact
https://www.taxtmi.com/tmi_notes?id=2553

Summary: GST-evasion bail adjudication requires a case-specific assessment of custodial necessity rather than an automatic consequence of the alleged tax magnitude, Magistrate-triability, or a maximum five-year sentence. Section 132 classification depends on the precise offence clause and punishment bracket, not merely on the alleged quantum of evasion. Relevant considerations include the stage of investigation, cooperation with summons, security of evidence, individual role, risks of absconding or interference, proportionality, and personal liberty under Article 21.
7. Customs : Country of Origin Certificates and Preferential Customs Duty under Notification No. 46/2011-Customs r.w.s 28DA
https://www.taxtmi.com/tmi_notes?id=2552

Summary: Preferential customs-duty treatment requires compliance with applicable rules of origin and reliable proof that imported goods qualify as originating. A country-of-origin certificate is important evidence but does not remove the importer's duty to possess supporting origin information and exercise reasonable care. Challenges to preferential treatment must be certificate-specific and consignment-specific: an adverse finding concerning identified certificates cannot, without direct evidence, invalidate separate certificates. Customs verification should identify the particular proof of origin, alleged defect and material linking it to the import, while fraud, suppression or misrepresentation independently established may support substantive action.
8. GST : Refund of Accumulated Input Tax Credit on Packing Materials under Section 54(3)(ii) of the CGST Act
https://www.taxtmi.com/tmi_notes?id=2551

Summary: Refund of accumulated input tax credit under Section 54(3)(ii) may arise where packing materials used to make taxable packaged outward supplies bear a higher tax rate than the outward supply and generate the accumulation. The inquiry extends to all qualifying inputs and is not limited to a principal raw material. Parity between the rate on bulk tea and packaged tea does not itself preclude refund if higher-taxed packing materials used for the packaged supply are the cause of unutilised credit.
9. GST : Detention of Goods in Transit: Consequences of Delay in Notice under Section 129(3)
https://www.taxtmi.com/tmi_notes?id=2550

Summary: Section 129(3) establishes a mandatory two-stage timeline: issuance of the penalty notice within seven days of formal detention or seizure, followed by a penalty order within seven days of legally effective service. The periods are independent, and compliance at one stage cannot cure delay at the other. Service, portal timestamps and the electronic records required under Rule 142 are material to chronology. Penalty requires a hearing, while payment under protest may still require a reasoned order to preserve appellate access. Later confiscation action cannot ordinarily cure a defective detention adjudication.
10. Income Tax : Section 192 TDS on Leave Travel Concession and the Effect of Subsisting Judicial Restraint
https://www.taxtmi.com/tmi_notes?id=2549

Summary: A subsisting judicial restraint expressly prohibiting deduction from leave travel concession reimbursements governs the employer's withholding conduct for the covered period. Non-deduction in compliance with that restraint cannot constitute failure to discharge an enforceable duty under Sections 192 and 201, even if the underlying exemption claim is later found substantively unavailable. The restraint does not eliminate employee-level tax liability. For unprotected periods, foreign-leg or circuitous travel claims remain outside the domestic-travel condition, and payer protection may depend on proving employee return filing, income inclusion and tax payment through Form 26A.

Highlights / Catch Notes

Income Tax

1. Income-tax information remains protected personal data; maintenance claims do not establish larger public interest for RTI disclosure.
https://www.taxtmi.com/highlights?id=104908

Case-Laws - HC : Income-tax returns constitute personal information protected from disclosure under the RTI Act unless a larger public interest justifies disclosure. That exception is confined to transparency concerning public authorities and does not cover private financial information lacking a bearing on the public at large. A spouse seeking the other spouse's net taxable income for maintenance proceedings cannot rely on the larger-public-interest exception, because the maintenance forum may require both parties to file income, asset and liability disclosure affidavits. The direction to disclose the taxpayer's income details was therefore set aside, without limiting remedies available before the maintenance forum.

2. Notional interest on tenancy deposits cannot be taxed without a right to receive interest or suppressed rent.
https://www.taxtmi.com/highlights?id=104907

Case-Laws - AT : Notional interest on interest-free tenancy security deposits is not taxable merely because deposits were received: absent a contractual right to interest or evidence that rent was suppressed or substituted, no real income accrues. Capital introduced by an identified partner through verified bank accounts cannot be added in the firm's hands merely because the partner's antecedent source remains doubtful, unless the funds are shown to belong to the firm. A cash-deposit addition must exclude amounts already treated as partner capital, while unreconciled balances require cash-book verification. Expenditure disallowance under section 14A requires exempt income in the relevant year; ad hoc business-expense disallowance also fails without identified non-business expenditure or record defects.

3. Head Office cost allocation requires prescribed transfer-pricing methods; treaty ceilings bar surcharge and cess, while duplicate taxation is excluded.
https://www.taxtmi.com/highlights?id=104906

Case-Laws - AT : Direct Head Office and overseas-branch expenditure incurred specifically for an Indian branch is deductible when directly attributable and supported by invoices, rather than being treated as general Head Office expenditure subject to the statutory cap. Under the India-France DTAA, branch-to-Head Office interest is not independently taxable where paid by the Indian permanent establishment, treaty tax-rate ceilings exclude separate surcharge and cess, and refund interest is taxed at the treaty rate. Common-cost allocations must be benchmarked by a prescribed transfer-pricing method, not assigned a nil value without examining services, costs and allocation keys. ECB interest already attributed to the permanent establishment must be recomputed without double taxation.

4. Post-detection income surrender does not shield bogus expenditure claims from penalties for misreporting and under-reported income.
https://www.taxtmi.com/highlights?id=104905

Case-Laws - AT : Post-detection surrender of depreciation and amortisation claims arising from dealings with a non-genuine supplier was treated as non-voluntary where survey findings and adverse material had exposed accommodation entries, the original return claimed the expenditure, and no revised return correctly disclosed income. Failure to prove the supplier's existence supported misreporting through suppression of facts and false entries; a surrender to buy peace or avoid litigation after detection did not preclude penalty for under-reported income. A challenge that the penalty notice omitted the specific misreporting clause was rejected because it had not been raised before the assessing or appellate authorities or through grounds before the Tribunal. The penalty was sustained and the appeal dismissed.

5. Residential reinvestment relief covers pre-transfer flats funded by housing loans, while unsupported cash deposits remain taxable.
https://www.taxtmi.com/highlights?id=104904

Case-Laws - AT : Section 54F permits acquisition of a new residential asset within one year before transfer of the original asset and does not require that sale consideration alone fund the purchase. Where the flat is acquired within that period and the investment exceeds the capital gain, housing-loan financing does not disqualify the exemption; the capital-gain addition does not survive. Unexplained cash deposits remain liable to addition where the taxpayer produces no documentary evidence of source, fails to rebut adverse findings, and gives inconsistent explanations.

6. Transfer-pricing comparability adjustments require quantified evidence, while regulatory borrowing ceilings do not replace arm's-length benchmarking.
https://www.taxtmi.com/highlights?id=104903

Case-Laws - AT : Rule 10B(3) requires examination of differences that materially affect net profit margins and reasonably accurate comparability adjustments where quantification is possible. Capacity underutilisation and differing customs-duty burdens may distort manufacturing-segment profitability, but claims require complete quantitative and documentary support and fresh functional comparability analysis. Regulatory ceilings for external commercial borrowings do not replace transfer-pricing arm's-length benchmarking; interest comparables must reflect materially similar credit profile, scale and risk attributes rather than rely on a single unsuitable comparable. Penalty proceedings for under-reporting, misreporting or alleged false entries remain separate from assessment proceedings, making a challenge to their initiation premature.

7. Cost-to-cost reimbursement of seconded employees is not service consideration; transfer-pricing markup was deleted and amalgamation amortisation allowed.
https://www.taxtmi.com/highlights?id=104902

Case-Laws - AT : Cost-to-cost recovery of salary and travel expenses for employees temporarily seconded to associated enterprises constitutes expense reimbursement rather than consideration for margin-bearing services where recovered exactly at cost. Accordingly, the transfer-pricing mark-up adjustment was deleted, supported by consistent treatment in other years and a bilateral Advance Pricing Agreement allowing recovery at cost. Amalgamation expenditure incurred after approval is amortised over five years beginning in the assessment year relevant to the year of expenditure, not the appointed amalgamation date. The fifth annual deduction was allowed because the claim had been accepted for the prior four years without changed facts.

8. TNMM functional comparability requires segmental evidence for diversified providers, while receivable interest demands transaction-specific arm's length benchmarking.
https://www.taxtmi.com/highlights?id=104901

Case-Laws - AT : TNMM functional comparability requires reliable evidence of the proposed comparable's activities during the relevant year. Entity-level margins of a diversified provider cannot support comparison with software development services where undated website descriptions and financial records do not establish segmental revenue or results; the comparable was excluded and the adjustment required recomputation, subject to the safe-harbour limit. Comparable margins must also be recomputed in line with DRP directions. For delayed foreign-currency receivables, arm's length interest cannot be fixed mechanically at a standard LIBOR spread; it requires analysis of the transaction, the associated enterprise's creditworthiness, and comparable uncontrolled rates. Domestic associated-enterprise receivables require verification before interest adjustment.

9. Aggregation of linked transfer-pricing transactions validated netted know-how fees, while unsupported director incentive disallowance could not stand.
https://www.taxtmi.com/highlights?id=104900

Case-Laws - AT : Closely linked technical know-how fee and poultry feed premix purchase transactions may be aggregated for transfer-pricing purposes under Rules 10AD(d) and 10B. Where know-how fees are netted against premix purchase costs and the associated enterprise's invoice prices are accepted under the CUP method, the resulting reduction in net purchase cost supports arm's length treatment; the separate adjustment for know-how fees was deleted. Related-party performance incentives to directors cannot be disallowed merely because of the relationship. Disallowance requires material showing that expenditure is excessive or unreasonable against fair market value, legitimate business needs, or benefits derived. In the absence of findings or comparables, the incentive provision disallowance was deleted.

10. Crystallisation of liability supports prior-period expense deduction, while functionally distinct divisions require separate transfer-pricing benchmarking.
https://www.taxtmi.com/highlights?id=104899

Case-Laws - AT : Prior-period expenditure is allowable where the liability, including its particulars and quantum, became known and ascertainable only in the relevant year; invoices may be recorded on crystallisation notwithstanding that the underlying expenditure relates to an earlier period. Transfer-pricing analysis must separately benchmark functionally distinct consulting and captive back-office divisions where their functions, methods and economic profiles differ. Entity-level aggregation is unsustainable in those circumstances, supporting deletion of the related adjustment.

11. Manufacturing scrap deductions and exempt-income disallowance safeguards upheld, while royalty benchmarking proceeds for fresh transfer-pricing review.
https://www.taxtmi.com/highlights?id=104898

Case-Laws - AT : Manufacturing scrap generated in the ordinary manufacturing process and directly connected with goods produced by eligible undertakings qualifies for profit-linked deduction. Additional exempt-income expenditure cannot be disallowed through a mechanical formula without recorded dissatisfaction, having regard to the accounts, with the voluntary disallowance; no further disallowance was warranted where it exceeded exempt dividend income. Corporate guarantees to associated enterprises are international transactions, with guarantee commission restricted to 0.35% under consistent prior-year treatment; consistency also precluded notional interest on unchanged equity contributions. Common-expense allocation under an established incremental approach was accepted. Royalty benchmarking was remitted for a fresh arm's-length review after disclosure of the search strategy and hearing, while a challenge without an underlying adjustment was redundant.

12. Vivad Se Vishwas settlement scope excludes independent reassessment disputes, while unsupported bogus-purchase additions require disclosed transaction particulars.
https://www.taxtmi.com/highlights?id=104897

Case-Laws - AT : Settlement under the Direct Tax Vivad Se Vishwas Scheme, 2020 was confined to the dispute from the original assessment, as confirmed by the declaration, Form No. 5 and Assessing Officer verification. Subsequently initiated reassessment proceedings did not fall within that settlement, so dismissal on the premise that the reassessment dispute stood settled was set aside. The reassessment addition for alleged bogus purchases was deleted because the identities of suppliers, transaction-wise details, invoices and supporting material were not disclosed, leaving no clear factual basis for the addition.

13. Functional comparability under TNMM requires transaction-specific FAR analysis before benchmarking business-support services provided to associated enterprises.
https://www.taxtmi.com/highlights?id=104896

Case-Laws - AT : Arm's-length benchmarking of business-support and general-management services rendered to an associated enterprise must focus on the specific controlled transaction and the functions performed, assets employed and risks assumed. TNMM does not remove the requirement for functional comparability; hospital or healthcare entities cannot be selected merely because the taxpayer operates fertility clinics without demonstrating similarity to the services benchmarked. Inadequate examination or production of the agreement, invoices and contemporaneous evidence concerning actual service rendition required fresh determination. The transfer-pricing adjustment was set aside and remitted for arm's-length price determination after FAR analysis and selection of functionally comparable entities.

14. Omitted specified-domestic-transaction rules invalidated transfer-pricing adjustments, while derivative losses and exempt-income expenditure limits remained sustainable.
https://www.taxtmi.com/highlights?id=104895

Case-Laws - AT : Omission of clause (i) of section 92BA rendered transfer-pricing references and consequential adjustments for covered specified domestic transactions unsustainable, making the alternative dispute over the most appropriate method academic. Mark-to-market losses from equity and currency futures remained allowable because no material factual or legal distinction from the earlier decision was established. Where audited statements showed own funds exceeded investments generating exempt income, no interest disallowance applied. Administrative expenditure disallowance was confined to investments relevant to exempt income after crediting the taxpayer's self-disallowance. The Revenue's appeals were dismissed, while the taxpayer's alternate challenge did not survive.

15. Advance pricing agreement methodology can guide benchmarking for non-covered years when functions, assets, risks and activities remain materially unchanged.
https://www.taxtmi.com/highlights?id=104894

Case-Laws - AT : Advance Pricing Agreement methodology may guide transfer-pricing benchmarking for an assessment year outside the agreement's term if the FAR analysis and underlying activities do not materially differ from covered years. Where Revenue challenges reliance on that methodology, it must establish the relevant factual distinction. A Transfer Pricing Officer who rejects the taxpayer's benchmarking in favour of the Other Method should apply that method and determine an arm's length price, rather than fixing a nil price on an ad hoc basis.

16. MAT credit succession on amalgamation allows a transferee to claim available unutilised credit under a sanctioned scheme, subject to verification.
https://www.taxtmi.com/highlights?id=104893

Case-Laws - AT : Unutilised MAT credit and taxes of amalgamating companies may accrue to the transferee where a sanctioned amalgamation scheme so provides. The limited exclusion under section 115JAA for conversion of a private or unlisted public company into an LLP does not extend by implication to amalgamation. Absence of an express enabling provision for amalgamation therefore does not itself prevent succession to MAT credit. The claimed credit remains subject to verification of its quantum and availability under law, with related refund, demand, and interest requiring consequential recomputation.

17. Advertisement expenditure as brand-promotion service requires proof of an arrangement; adjustment deleted and other tax computations remanded.
https://www.taxtmi.com/highlights?id=104892

Case-Laws - AT : Advertisement and publicity expenditure paid to third-party vendors does not constitute a separate international transaction of brand-promotion services merely because group communication standards exist or an associated enterprise obtains an incidental benefit; an underlying arrangement or understanding must be established. The related transfer-pricing adjustment was deleted. Where an assessment order and computation sheet show differing carry-forward loss figures, the eligible loss requires verification against assessed income or loss and applicable law; limited recomputation was remanded. TDS/TCS credit after amalgamation depends on the transferee offering or being assessed on the corresponding income, subject to verification of amalgamation records, tax credit and supporting evidence; that claim was remanded.

18. Tax-audit exemption for substantially State-funded educational universities prevents audit-failure penalties where income qualifies for statutory exemption.
https://www.taxtmi.com/highlights?id=104891

Case-Laws - AT : Income of a substantially State-funded educational university was exempt under section 10(23C)(iiiab), removing the requirement for a tax audit under section 44AB. As the audit obligation did not apply, penalty under section 271B for failure to obtain an audit was inapplicable. Tax-audit penalties for both assessment years were therefore deleted.

19. Notional interest on delayed trade receivables may be deleted when financial records verify the taxpayer is completely debt-free.
https://www.taxtmi.com/highlights?id=104890

Case-Laws - AT : Transfer-pricing adjustments for notional interest on delayed trade receivables may not be warranted where the taxpayer is completely debt-free and bears no interest cost on borrowings. The taxpayer's debt-free position requires verification from financial records before the adjustment can be removed. Verification is limited to that factual status; once established, the adjustment for interest on outstanding trade receivables is to be deleted. The matter is remitted for this limited verification, with consequential relief dependent on confirmation of the debt-free status.

20. Functional, asset and risk analysis excludes diversified technology companies from captive software development comparables under cost-plus arrangements.
https://www.taxtmi.com/highlights?id=104889

Case-Laws - AT : Functional, asset and risk analysis requires comparables for a captive software development service provider to reflect its limited-risk, cost-plus operating model. Diversified technology companies with broad service portfolios, substantial brand value and intangibles, significant research and development, goodwill, patents, and different risk profiles are functionally dissimilar. The absence of standalone segmental information further impairs reliable comparison. Infosys Ltd., Wipro Ltd. and LTI Mindtree Ltd. are therefore unsuitable comparables, requiring recomputation of any transfer-pricing adjustment after their exclusion.

21. Retracted search surrenders without corroboration cannot sustain undisclosed-income additions; no section 14A disallowance arises without exempt income.
https://www.taxtmi.com/highlights?id=104888

Case-Laws - AT : Retraction of a search surrender, when satisfactorily explained and unsupported by corroborative evidence, cannot alone sustain an undisclosed-income addition; the related addition was deleted. No section 14A disallowance arises where no exempt income was earned for the relevant year, and the later Explanation was prospective. Seizure of incriminating material permits assessment of total income under section 153A for completed years, including other issues. Interest for delayed remittance of tax deducted at source is compensatory and allowable as business expenditure. Depreciation on trucks used for own-goods transport must be computed at the lower prescribed rate on year-wise written-down value.

22. Charitable trust registration cancellation requires proof of non-genuine activities, while year-specific irregular receipts remain assessment matters.
https://www.taxtmi.com/highlights?id=104887

Case-Laws - AT : Cancellation of charitable-trust registration under section 12AA(3) depends on whether activities are non-genuine or conducted contrary to charitable objects. Registration proceedings assess the institution's charitable character and overall conduct, while alleged irregular receipts or income application in specified years are matters for assessment proceedings. Alleged capitation fees supported only by uncorroborated material recovered from third parties do not, without evidence of institutional receipt, establish that the trust's activities as a whole are non-genuine. Continuing educational and medical services, scholarships, and free treatment remain relevant to the genuineness inquiry.

Benami Property

23. Benami cash routing through third-party bank accounts permits attachment of remaining balances and traceable converted funds.
https://www.taxtmi.com/highlights?id=104886

Case-Laws - AT : Cash is movable property capable of being held benami. Where a beneficial owner supplies demonetised cash to a third party, who deposits it in that person's bank account and retransfers the funds through banking channels, the third party lends their name and holds the resulting bank balance for the provider's benefit. The cash constitutes consideration for the bank balance, and the retransfer evidences beneficial ownership; the duration of holding is immaterial. The transaction was treated as benami, with attachment limited to the remaining balance and the amount held in an interest-free bond, subject to tracing unavailable funds.

GST

24. Cash seizure under CGST search powers requires clear statutory authority, objective reasons, and evidentiary relevance despite appellate remedies.
https://www.taxtmi.com/highlights?id=104915

Case-Laws - HC : Section 67(2) of the CGST Act is described as not authorising seizure of cash merely because it is suspected to represent unaccounted sale proceeds. Cash is excluded from "goods" and, under an ejusdem generis construction, "things" is confined to material with evidentiary relevance alongside documents and books. Seizure requires objectively supported reasons to believe satisfying statutory conditions; a later adjudicatory finding cannot cure absent authority at the time of seizure. A jurisdictional challenge to such seizure may proceed despite an alternative appellate remedy. Release remains subject to any independently lawful restraint or attachment, with applicable interest.

25. Show cause notice limits prevent unproposed penalties, requiring fresh adjudication when orders exceed the notified demand.
https://www.taxtmi.com/highlights?id=104914

Case-Laws - HC : Section 75(7) bars confirmation of a demand exceeding the scope of the show cause notice. Where a notice does not propose a penalty, an adjudicating authority cannot impose one in the final order; such confirmation exceeds jurisdiction. An adjudication order imposing an unnotified penalty was therefore set aside, and the matter was remitted for fresh adjudication after giving the petitioner an opportunity of hearing.

26. Statutory stay of GST recovery bars adjustment of eligible refunds against disputed demands after appellate pre-deposit.
https://www.taxtmi.com/highlights?id=104913

Case-Laws - HC : Payment of the prescribed appellate pre-deposit and filing of an appeal before the Tribunal trigger a deemed stay of recovery of the balance disputed GST demand under section 112(9), read with the CBIC Circular. During that statutory stay, net eligible GST refunds cannot be appropriated against the stayed demands. Appropriation of refunds for July to September 2023 against demands for financial years 2017-18 to 2019-20 was therefore impermissible, requiring restoration of the net eligible refund while the pending appeals proceed independently on merits.

27. GST audit finalisation requires consideration of objections; notices based on non-final observations cannot validly stand.
https://www.taxtmi.com/highlights?id=104912

Case-Laws - HC : GST audit commencement under the Explanation to Section 65(4) is reckoned from the later of record furnishing and on-site institution at the registered person's business premises. An audit following prior production of records therefore remains within time if completed within the statutory period measured from on-site commencement. Rule 101(4) requires the registered person to receive an opportunity to object to discrepancies and have those objections considered before audit findings are finalised. Audit observations seeking a response are not final findings and cannot properly support a show cause notice before that procedure is completed. Objections must be received and considered before fresh finalisation of the audit.

28. Inverted duty refunds remain available where higher-taxed inputs cause credit accumulation, despite matching rates for a principal input.
https://www.taxtmi.com/highlights?id=104911

Case-Laws - HC : Refund of unutilised input tax credit under the inverted duty structure remains available under section 54(3) where accumulation results from higher tax on certain inputs than on output supplies. Circular No. 135/05/2020 does not bar such a claim merely because one principal input and the output supply attract the same tax rate. The refund application must be considered under section 54(3), and time spent pursuing writ proceedings is excluded when calculating the limitation period.

29. Departmental appeals after GST registration restoration become infructuous when the Department has implemented the appellate orders.
https://www.taxtmi.com/highlights?id=104910

Case-Laws - AT : First Appellate Authority cannot condone delay beyond the statutory outer limit for appeals against GST registration cancellation. Constitutional directions tailored to individual cases cannot enlarge statutory appellate jurisdiction or override an express limitation. The Department's restoration of cancelled registrations after implementing appellate orders altered taxpayers' legal and commercial positions; its challenges to those orders therefore became academic, futile, infructuous and not maintainable, as no effective relief could be granted without addressing the consequences of restoration.

30. Statutory condonation limits restrict delayed GST cancellation appeals, but implemented registration restorations can make departmental challenges infructuous.
https://www.taxtmi.com/highlights?id=104909

Case-Laws - AT : Statutory outer limits on condoning delay restrict the First Appellate Authority's jurisdiction in GST registration-cancellation appeals; equitable considerations and fact-specific constitutional orders cannot extend that power. However, where the Department has already restored registrations pursuant to the challenged appellate orders, its challenge may become infructuous because reversing those orders without addressing the consequences of implementation offers no effective relief. Failure or inability to seek revocation through Rule 23, including where the common portal blocks a late application, does not extinguish the independent statutory right to appeal cancellation of GST registration.

31. Statutory pre-deposit enables tax appeals on merits, with prior deposits adjusted and balance demand stayed after compliance.
https://www.taxtmi.com/highlights?id=104874

Case-Laws - HC : Statutory appellate remedies against tax adjudication orders were permitted despite limitation objections being waived, subject to compliance with the mandatory pre-deposit requirement. Amounts previously deposited towards the disputed tax demand were to be adjusted against the pre-deposit. Upon satisfying that requirement, the statutory stay applied to the remaining disputed demand. Appeals filed within the specified two-week period were to be entertained and decided on merits without a limitation objection.

Customs

32. Customs assessment transparency improves through a searchable NAC Portal for consistent classification, valuation, and trade-facilitation information.
https://www.taxtmi.com/highlights?id=104944

Circulars : The National Assessment Centre Portal provides importers, customs brokers, stakeholders and Customs officers with a central, searchable repository of NAC decisions, legal precedents, advance rulings, audit objections, advisories, alerts, circulars, public notices and meeting records. It covers classification, valuation and other assessment-related issues, including matters resolved by NACs and those requiring policy intervention. Centralised access is intended to promote consistent Customs assessment across formations, improve transparency and certainty, support informed compliance, reduce divergent interpretations and avoidable disputes, and strengthen trade facilitation.

33. Rectification jurisdiction excludes merits review where objections challenge concluded penalty findings rather than patent errors on the record.
https://www.taxtmi.com/highlights?id=104885

Case-Laws - AT : Rectification of a mistake apparent from the record is confined to patent, self-evident errors and cannot reopen the merits or adopt another possible view. Challenges to the effect of show cause notices, adjudication findings, penal provisions and statutory consequences required reconsideration of the concluded penalty finding for facilitative conduct. As no accidental omission or apparent error was shown, the rectification applications were rejected and the penalty order remained unchanged.

34. Mobile-phone electronic evidence failed to establish customs undervaluation, while duty survived on non-authentic origin certificates without importer penalties.
https://www.taxtmi.com/highlights?id=104884

Case-Laws - AT : Electronic evidence recovered from mobile phones, including spreadsheets, WhatsApp material and ledger data, could not establish customs undervaluation where it was selectively used, lacked forensic verification and corroboration, and relied on retracted statements without examination. Declared transaction values could not be rejected or residual valuation applied without assessing unrebutted contemporaneous import data and evidence specific to each import; extrapolation was insufficient. Consequently, undervaluation demands and related liabilities failed. Preferential tariff concessions were unavailable for identified consignments supported by certificates of origin not authenticated by the issuing authority, so customs duty and interest remained payable on those consignments. Importers were not liable to penalty absent proof of involvement or collusion in obtaining the non-authentic certificates.

35. Customs reassessment acceptance preserves challenge rights where transaction value is rejected solely on unsupported NIDB data.
https://www.taxtmi.com/highlights?id=104883

Case-Laws - AT : Written acceptance of an enhanced customs assessable value does not waive an importer's statutory right to challenge reassessment; it may only dispense with the proper officer's obligation to issue a speaking order. Rule 12(2) requires the proper officer to form and communicate written grounds for reasonable doubt before rejecting the declared transaction value. Acceptance letters lacking particulars of alleged contemporaneous imports do not meet that requirement. NIDB data alone, without independent and cogent supporting material, cannot sustain rejection of declared value or enhancement. The enhanced values and appellate orders were unsustainable, and the appeals succeeded with consequential relief.

36. Furnace re-lining refractories qualify as EPCG capital goods, securing zero-duty import benefits and eliminating related customs demands.
https://www.taxtmi.com/highlights?id=104882

Case-Laws - AT : Furnace re-lining refractory materials qualify as capital goods under the zero-duty EPCG Scheme when used as accessories indirectly required for manufacture. The specific inclusion of refractories for initial furnace lining in the inclusive definition does not restrict the broader substantive definition covering such accessories. Refractories imported for furnace re-lining and maintenance are therefore eligible for zero-duty import benefits. Differential duty, interest, penalty, confiscation and redemption fine imposed on that basis were set aside, with consequential relief.

37. Automotive radio classification treats integrated infotainment features as supplementary, placing complete and qualifying unassembled units under the radio tariff heading.
https://www.taxtmi.com/highlights?id=104881

Case-Laws - AAAR : Multifunctional car radio units designed exclusively for motor vehicles, externally powered and combining radio reception with sound reproduction, fall under Customs Tariff Item 8527 21 00 even where they include touchscreen, Bluetooth, Wi-Fi, USB, camera input, audio/video playback and phone-mirroring features. Those additional features are supplementary and do not convert the units into telecommunications equipment, navigation apparatus, monitors or standalone players; absence of built-in speakers does not negate sound-reproducing capability. Semi-knocked-down imports comprising configured screen panels, PCBAs and cable sets presented together likewise take the complete-unit classification under GRI 2(a) if they retain essential character and require only limited assembly and testing. Importation remains subject to applicable BIS certification and Customs verification.

38. Storage-server classification determines end-use Basic Customs Duty exemption for qualifying imported manufacturing inputs, subject to prescribed conditions.
https://www.taxtmi.com/highlights?id=104880

Case-Laws - AAR : Crestone disk-storage enclosures without a central processing unit and dependent on a host system are classified as storage units under tariff item 8471 70 90. Server models incorporating a central processing unit and system memory are automatic data processing machines; where their processing and storage units are housed together but not with input and output units, they fall under tariff item 8471 50 00. Imported inputs used to manufacture these Heading 8471 storage servers qualify for the Serial No. 39 end-use exemption from Basic Customs Duty, provided excluded goods are not involved and actual-use and prescribed end-use procedures are satisfied. Integrated tax and other duties, taxes and cesses remain payable.

39. Customs classification of battery insulating tape distinguishes dedicated die-cut accumulator parts from general-use self-adhesive rolls.
https://www.taxtmi.com/highlights?id=104879

Case-Laws - AAR : Advance-ruling applications may cover ongoing import activities after removal of the requirement that the activity be merely proposed, provided the question is neither pending nor settled by a competent forum; rulings operate prospectively. Battery-specific die-cut insulating tape, imported in pre-cut profiles for direct incorporation into lithium-ion battery packs, is classified as other parts of electric accumulators under CTI 8507 90 90. Continuous self-adhesive plastic tape in rolls remains classified at import as plastic adhesive tape under CTI 3919 10 00, notwithstanding post-import cutting. Both products may receive concessional basic customs duty for battery-pack manufacture, subject to specified end use, prescribed conditions, and compliance with the IGCR Rules, 2022.

DGFT

40. Minimum import price condition for Glufosinate imports continues, preserving existing import requirements across relevant tariff classifications.
https://www.taxtmi.com/highlights?id=104948

Notifications : The minimum import price condition on imports of Glufosinate and its salts under specified Chapter 38 ITC (HS) classifications is extended until 12 April 2027. All other terms and conditions applicable under the earlier notification imposing the condition remain unchanged. The extension maintains the existing import-policy restriction for covered Glufosinate products.

41. Restricted silver imports may clear under a valid import authorisation without additional status or exchange-routing requirements unless expressly imposed.
https://www.taxtmi.com/highlights?id=104943

Circulars : Silver classified under ITC(HS) 71069221 is a restricted import and may be imported against a valid Import Authorisation, subject to its endorsed conditions and applicable exemptions. The authorisation identifies the holder, item, quantity and value, allowing the holder to import directly in its own name. Nominated Agency, IFSCA Qualified Jeweller or EOU status is not an additional eligibility requirement unless expressly imposed by the authorisation. The IIBX import requirement applies only to IFSCA-notified Qualified Jewellers for goods covered by a separate policy amendment and does not apply to silver under ITC(HS) 71069221. Customs clearance must follow these conditions and extant procedure.

FEMA

42. Foreign Exchange Risk Reserve imposes daily cash collateral and reporting duties on qualifying INR derivative hedging contracts.
https://www.taxtmi.com/highlights?id=104942

Circulars : Authorised Dealers must maintain a Foreign Exchange Risk Reserve for INR-related foreign exchange derivatives entered into with users. The reserve applies where the notional value exceeds USD two million equivalent and the derivative hedges a current account transaction in which the user purchases foreign currency against INR. It must equal 20 per cent of each contract's INR-equivalent notional amount, be deposited in cash in India with RBI daily, and remain maintained until contract termination. Splitting transactions among one or more Authorised Dealers to avoid the threshold is a violation. Daily FERR details must be reported through CIMS. Requirements apply to contracts undertaken after issuance.

43. Credit-rating conflict safeguards extend to promoter borrowers and subsidiaries, invalidating penalties based on a narrower interpretation.
https://www.taxtmi.com/highlights?id=104876

Case-Laws - AT : Credit-rating restrictions for promoter-connected entities extend conditions concerning common chairmen, directors or employees to securities issued by a promoter's borrowers and subsidiaries, not only associates. Regulation 27(1) was ambiguous on the scope of those conditions and required harmonious construction with the related conflict-of-interest regime in Regulation 28V. Contemporaneous regulatory material and legislative-committee material supported that interpretation. The penalty order was consequently set aside and the appeal allowed.

Companies Law

44. Separate corporate personality prevents directors from being personally liable for company deposits without a guarantee or independent legal undertaking.
https://www.taxtmi.com/highlights?id=104878

Case-Laws - HC : Separate legal personality of a company prevents its debts from being imposed on directors merely because they hold office. Liability for unpaid company deposits requires a personal guarantee, an independent contractual undertaking, or a statutory basis. Deposit receipts evidencing transactions with the company do not, without more, establish a director's personal repayment obligation. Joint and several liability imposed on the chairman and director was therefore removed, while the decree against the remaining defendants continued.

SEBI

45. Common Advertisement Code imposes disclosure and content controls on securities intermediaries' promotional communications, banning misleading claims and inducements.
https://www.taxtmi.com/highlights?id=104947

Notifications : Common Advertisement Code will govern advertisements by stock brokers, depository participants, online bond platform providers, investment advisers, research analysts, mutual funds, asset management companies and portfolio managers for products or services within SEBI's remit, taking effect 180 days after Gazette publication. Advertisements must identify the regulated entity and carry prescribed disclaimers. Educational or factual communications remain outside the definition only if they do not promote or solicit products or services. Celebrity endorsements require prior approval, must be limited to entity or brand promotion, and cannot be charged to clients or mutual fund schemes. Advertisements must be fair and comprehensible, avoid inducements and dark patterns, and cannot contain misleading content, testimonials, return assurances, improper performance claims or unfair comparisons. Ratings or rankings may be used only from a Past Risk and Return Verification Agency, subject to specified disclosures.

46. Mutual fund regulatory references shift to the Intermediaries Regulations framework, with the Fifth Schedule omitted from governing rules.
https://www.taxtmi.com/highlights?id=104946

Notifications : Mutual fund regulatory references to the Fifth Schedule are replaced with references to Chapter IIID of the Securities and Exchange Board of India (Intermediaries) Regulations, 2008. The amendment updates regulation 28 and regulation 81(l) and omits the Fifth Schedule from the Mutual Funds Regulations, 2026. These changes take effect 180 days after publication in the Official Gazette, consolidating the relevant requirements under the Intermediaries Regulations framework.

47. Call-recording requirements for institutional-investor client communications become non-mandatory, while institutional-investor status adopts the existing regulatory definition.
https://www.taxtmi.com/highlights?id=104945

Notifications : Research analyst regulations now define "institutional investor" by adopting the meaning used in the capital-issue and disclosure framework. Research analysts are no longer mandatorily required to maintain recordings of calls with clients that are institutional investors. The exemption is confined to call-recording obligations for communications with such clients. These amendments take effect on the thirtieth day following publication in the Official Gazette.

48. Cross-segment derivatives manipulation: integrated order patterns can support interim restraints, while director liability requires responsibility, consent, connivance, or neglect.
https://www.taxtmi.com/highlights?id=104873

Notes : Cross-segment price manipulation may arise where futures orders are allegedly used to move prices or create artificial order-book signals so that larger, economically opposite options positions obtain favourable ex*****on. Section 12A of the SEBI Act and Regulations 3 and 4 of the PFUTP Regulations prohibit manipulative or deceptive devices, false appearances of trading and price manipulation; liability depends on the integrated sequence of orders, price impact, options ex*****on, cancellations, exposure and persistence, rather than opposite positions or LTP contribution alone. Section 27 attributes company contraventions to directors responsible for business conduct, subject to knowledge and due-diligence defences, and separately covers consent, connivance or neglect. Interim measures may restrict market access, impound proceeds and preserve assets; disgorgement is generally person-specific, though joint-and-several exposure may follow common intentional action or a central role.

IBC

49. Recall jurisdiction cannot cure affidavit defects or permit non-parties in disciplinary stay proceedings as parties.
https://www.taxtmi.com/highlights?id=104877

Case-Laws - AT : Recall jurisdiction cannot be used to reopen a concluded order on its merits merely by alleging fraud in a notarised affidavit. Rules governing affidavit attestation, form and evidentiary acceptability distinguish rectifiable defects from deception that materially affects a decision; where the affidavit's contents are not denied, an attestation defect alone does not establish fraud. Third-party impleadment in a disciplinary appeal requires a direct legal right affected by the relief sought. A non-party cannot seek limited impleadment only in a stay application while remaining outside the main appeal, consistent with the principle of dominus litis.

Money Laundering

50. Proceeds of Crime Tracing Supports Attachment Where Escrow Funds Fund Property Despite Intermingling With Other Money
https://www.taxtmi.com/highlights?id=104875

Case-Laws - AT : Proceeds of crime under the PMLA include property derived or obtained, directly or indirectly, from criminal activity relating to a scheduled offence, including its value. Registration of FIRs and charge-sheets alone does not establish that every asset of an accused person or company has that character. Bank-account analysis and PMLA statements tracing project escrow funds towards a property can establish a prima facie nexus. Intermingling of project funds with other money requires examination of the complete money trail; independent income, financial-statement disclosure, or tax-department awareness does not by itself break the connection. Such tracing supports confirmation of attachment.

Includes full case law summaries, all notifications, circulars and more.

Proceeds of crime under the PMLA include property derived or obtained, directly or indirectly, from criminal activity relating to a scheduled offence, including its value. Registration of FIRs and charge-sheets alone does not establish that every asset of an accused person or company has that charac...