Amount received on account of share capital cannot to be treated as business income

Crescent Payments Pvt. Ltd. Vs DCIT (ITAT Mumbai) We hold that merely because there was violation of FEMA regulations by not allotting shares within 6 months from the date of receipt of monies towards share capital, it cannot automatically become the income of the assessee company. There is no such mandate provided in the law to treat the said receipt as income in these circumstances. With regard to applicability of provisions of section 56 of the Act, we find that section 56(1) of the Act speaks about “income of every kind which is not to be excluded from the total income under this Act sha...