HC Upholds ITAT Remand for Fresh Cash Flow Verification in Share Premium Addition u/s 68; Human Probability Test Not Enough

PCIT Vs Bharathi Cement Corporation Pvt. Ltd. (Telangana High Court) Conclusion: High Court should not interfere with the Tribunal’s procedural order remanding a share premium addition under Section 68 back to AO for a strictly fact-based verification of cash flows thorough verification of banking channels, cash flows, and accounting books rather than relying on the “test of human probabilities.” Held: Assessee-company received a substantial amount of share premium from five distinct investor companies in exchange for allocating preference shares during Assessment Years 2009-10 and 2010-...