Section 28(v) of the Income Tax Act

Revenue must demonstrate the existence of a Permanent Establishment (PE) of a foreign enterprise in India, including establishing that transactions underlying a Dependent Agent PE were not at arm's length. Income from the sale of goods is not taxable in India if title and risk in the goods pass outside India.

A new industrial undertaking is not considered a reconstruction of an existing business for tax deduction purposes if it is a separate, independent production unit manufacturing commercially tangible products that can operate without losing its identity in the old business. The transfer and substantial use of assets and manpower from an old business to a new one may indicate reconstruction.

Incentive provisions in the Income-tax Act, particularly those granting deductions for new industrial undertakings, must be construed liberally to achieve their legislative purpose. This principle guides the interpretation of conditions such as what constitutes a 'new undertaking' versus a 'splitting up or reconstruction' of an existing business for claiming deductions.

Penalty under Section 271(1)(c) cannot be levied when the quantum appeal is pending before the High Court or where a quantum addition is confirmed and a question of law is admitted by the High Court.

Salary paid to a partner is merely a mode of sharing profits and retains the character of the firm's income. The payment is an adjustment of the amount the partner is entitled to receive based on their contribution of human capital, skill, and toil.

A partner's income from a firm, including salary, bonus, commission, or remuneration, is considered business income in their hands. Expenses necessary for earning this business income are deductible.

Provisions intended to promote economic growth, such as those encouraging cooperative societies, are to be interpreted liberally. Restrictions on such provisions should be construed to advance their objective, not frustrate it.