Section 68

Tax Treatment of Cash Credit U/s. 68, 69, 69A, 69B, 69C and 69D

Income Tax - This Article discusses Tax Treatment of Cash Credit, Unexplained investments, Unexplained money, Amount of investments not fully disclosed in books of account, Unexplained expenditure and Amount borrowed or repaid on hundi in cash under section 68,Section 69, Section 69A, Section 69B, Section 69C and Section 69D respectively of Income Tax...

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Section 68 | Unexplained Cash Credit, Investment, Money

Income Tax - UNXEPLAINED CASH CREDITS, INVESTMENT, MONEY UNDER PROVISIONS OF INCOME TAX ACT, 1961 CASH CREDIT [SECTION 68]  define as any sum is found in the books of account of an assessee in any previous year and assessee has not provided any explanation of source or explanation provided by the assessee is not, in the opinion of […]...

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Bogus Share Premium/Share Capital – Responsibility of Assessee to Prove with Cognet Evidence

Income Tax - Merely because assessee company had filed all primary evidence, it could not be said that onus on assessee to establish credit worthiness of investor companies stood discharged u/s 68 of the Income Tax Act, 1961....

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Private Placement – of Shares or Unaccounted Money ???

Income Tax - Recent Judgement of Hon’ble Supreme Court in case of NRA Iron and Steel Pvt Ltd.- After this judgement, the authorities would get right to question the integrity of every issue or reissue of share capital, especially those by company in which public are not substantially interested because these companies generally issue shares on priva...

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Assessee Company failed to prove genuineness of investor section 68 gets attracted: SC

Income Tax - Assessee company failed to prove genuineness of investor – provisions of section 68 of the Income-tax Act attracted – Supreme Court The Apex court in the case of NRA Iron and Steel Pvt Ltd (SLP 29855 of 2018) held that the assessee company is under a legal obligation to prove the source of receipt of […]...

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Section 68 additions justified on failure to prove identity of share applicants

Royal Rich Developers (P.) Ltd. Vs Pr. CIT (Bombay High Court) - Royal Rich Developers (P.) Ltd. Vs Pr. CIT (Bombay High Court) We notice that during the original assessment as well as the remand proceedings, the assessee was given ample opportunities to produce the share investors which the assessee failed to do. The Assessing Officer thereupon issued the summo...

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Sec. 68 Addition cannot be made for mere non-compliance of notice by shareholders

DCIT Vs Bhaijee Commodities (P) Ltd. (ITAT Delhi) - AO required assessee-company to prove genuineness of share capital along with premium received by it. Assessee furnished various evidences in that regard. However, AO made addition under section 68 on the ground that in response to summons under section 131 shareholder companies had not appeared for...

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Disallowance cannot be made solely on third party information- Section 68/69

CIT Vs Ms Odeon Builders Pvt. Ltd. (Supreme Court) - The entire disallowance in this case is based on third party information gathered by the Investigation Wing of the Department, which have not been independently subjected to further verification by the AO who has not provided the copy of such statements to the appellant, thus denying opportunity of ...

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Bogus Share Capital: ITAT criticises casual approach of Department

ITO Vs M/s Citymaker Builder Pvt. Ltd. (ITAT Mumbai) - ITO Vs M/s Citymaker Builder Pvt. Ltd. (ITAT Mumbai) As two of the share applicant companies as per the information received by the A.O from the office of the DGIT(Inv), Mumbai, were the companies controlled  an infamous accommodation entry provider, therefore, it was incumbent on the part of the l...

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No addition U/s. 68 for Cash amount explained by assessee as derived from sale of agricultural produce

Shri Naresh Kumar Vs The Income Tax Officer (ITAT Delhi) - Where assessee had explained source of the cash deposit in the bank account by producing copies of the bills of sale of agricultural produce, which supported the explanation of assessee that assessee had received cash out of sale of agriculture produce, no addition under section 68 was warranted....

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SOP to apply provisions of section 68 of Income tax Act, 1961

246/151/2017-A&PAC-1 - (10/01/2018) - Assessing Officers should follow the sequence as noted below for applying provisions of section 68 of the Act: Step 1: Whether there is credit of a sum during the year in the books of accounts maintained by the taxpayer. Step 2: If yes, the assessee should be asked to explain the nature and source o...

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Section 68’s Popular Posts

Recent Posts in "Section 68"

Section 68 additions justified on failure to prove identity of share applicants

Royal Rich Developers (P.) Ltd. Vs Pr. CIT (Bombay High Court)

Royal Rich Developers (P.) Ltd. Vs Pr. CIT (Bombay High Court) We notice that during the original assessment as well as the remand proceedings, the assessee was given ample opportunities to produce the share investors which the assessee failed to do. The Assessing Officer thereupon issued the summons to the share purchasers calling upon ...

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Sec. 68 Addition cannot be made for mere non-compliance of notice by shareholders

DCIT Vs Bhaijee Commodities (P) Ltd. (ITAT Delhi)

AO required assessee-company to prove genuineness of share capital along with premium received by it. Assessee furnished various evidences in that regard. However, AO made addition under section 68 on the ground that in response to summons under section 131 shareholder companies had not appeared for personal deposition....

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Disallowance cannot be made solely on third party information- Section 68/69

CIT Vs Ms Odeon Builders Pvt. Ltd. (Supreme Court)

The entire disallowance in this case is based on third party information gathered by the Investigation Wing of the Department, which have not been independently subjected to further verification by the AO who has not provided the copy of such statements to the appellant, thus denying opportunity of cross examination to the appellant, who ...

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Bogus Share Capital: ITAT criticises casual approach of Department

ITO Vs M/s Citymaker Builder Pvt. Ltd. (ITAT Mumbai)

ITO Vs M/s Citymaker Builder Pvt. Ltd. (ITAT Mumbai) As two of the share applicant companies as per the information received by the A.O from the office of the DGIT(Inv), Mumbai, were the companies controlled  an infamous accommodation entry provider, therefore, it was incumbent on the part of the lower authorities to have carried out [&h...

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No addition U/s. 68 for Cash amount explained by assessee as derived from sale of agricultural produce

Shri Naresh Kumar Vs The Income Tax Officer (ITAT Delhi)

Where assessee had explained source of the cash deposit in the bank account by producing copies of the bills of sale of agricultural produce, which supported the explanation of assessee that assessee had received cash out of sale of agriculture produce, no addition under section 68 was warranted....

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Addition for outstanding loan repaid by assessee subsequently was unjustified

ITO Vs Habitat Infrastructure Ltd. (ITAT Delhi)

Since the unaccounted money as alleged by the AO was the loan, which was repaid subsequently by assessee, addition made on account of unverifiable unsecured loans was unjustified....

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Addition for unexplained cash deposits justified if explanation furnished by assessee not verifiable

Shree Narayan Meena Vs ITO (ITAT Jaipur)

AO was justified in making addition under section 68 on account of unexplained cash deposits found in bank account in case having regard to the human probabilities and normal course of human conduct, explanation offered by assessee was not wholesome, credible and verifiable....

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Addition justified for Receipt of share application money if Genuineness and creditworthiness not proved

M/s. Moira Steel Ltd Vs DCIT (ITAT Indore)

A perusal of financial statement, bank statements and income tax returns of share applicants companies clearly revealed that they had no regular means to invest in the share capital of the assessee company and, therefore, AO was justified in making addition under section 68 on the ground of lack of creditworthiness and genuineness....

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Addition for undisclosed stock not justified for mere difference in closing stock valuation

ACIT Vs National Cable Industries (ITAT Delhi)

Addition on account of undisclosed stock/ production is not justified where no physical discrepancy was found/detected by the survey team and excess value of stock was merely because of difference in valuation of closing stock...

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Addition justified for Unverified corpus donation 

Angika Development Society Vs Asstt. Director of Income Tax (Exemption) (ITAT Delhi)

Where corpus donation could not be verified as donor was not co-operating in providing details, it was rightly treated as unexplained cash credit under section 68....

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