Section 68

Brief Study of Section 269SS, 269T, 68 and 69 of Income Tax Act,1961

Income Tax - There are very few things in this world which are both Legal & Lethal. TAX is one of them. If tax provisions are not understood properly or tax is not paid in proper time, it is enough to give you hypertension. Moreover it is important to know what are the sections that affect your daily transactions and how these transactions are dealt w...

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Unexplained cash credits – Section 68 – Case Laws – Assessment

Income Tax - Section 68 of the I T Act is one of the most powerful yet debated provision of the I T Act. This provision has given plethora of judgments, sometimes conflicting, both in favour of Revenue and the assessee. In light of those judgements an attempt is made to analyse Section 68 with the following sub headings:...

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Accommodation entries from fake companies – Case Laws, Assessment Issues

Income Tax - When we refer to an entry of loan transaction as ‘fake loan’ received from a ‘paper company’, it invariably means that such entry represents unaccounted money of the person in whose books of account the money has been credited as loan and the lender company is only a conduit for routing the money back to the books of account of th...

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Section 115BBE and Section 68 – Taxing the unexplained!

Income Tax - This Article aims at highlighting the unsung provisions of Section 115BBE of the Income-tax Act, 1961 (Act), applicable from AY 2013-14 onwards and surfacing some practical concerns surrounding its applicability and further amendments made to this section....

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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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ITAT on Assessment of share capital/ premium as unexplained cash credit

M/s. Priyatam Plaschem Pvt. Vs The Income Tax Officer (ITAT Delhi) - Priyatam Plaschem Pvt. Ltd Vs ITO (ITAT Delhi) In this case ITAT explains  Law on whether share capital/ share premium received by a Company from investors can be assessed as ‘unexplained cash credit’  in the light of judgements of the Courts and Tribunal. In the case in hand Consideri...

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Addition for Bogus Share Capital cannot be made on the basis of mere suspicion

PCIT Vs M/s. Acquatic Remedies Pvt. Ltd. (Bombay High Court) - Tribunal, on examination of facts, has come to the conclusion that the investment made by the shareholders is not hit by Section 68 of the Act. It records, that the entire basis of the Revenue's case is based on surmise that the respondent was taking bogus purchase bills and cash was introduced in ...

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Addition for Bogus Purchases based merely on statements and not backed by any material evidences is not sustainable

M/s. Aquatic Remedies Pvt. Ltd. Vs The DCIT (ITAT Mumbai) - M/s. Aquatic Remedies Pvt. Ltd. Vs The DCIT (ITAT Mumbai) The Revenue has alleged the assessee of taking bogus purchases and accommodation bills on account of such purchased. In our considered opinion this refers to two possibilities. 1) A person is purchasing goods from another person without any b...

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Addition U/s. 68 rw section 56: Addition for share premium in excess of Fair Value

Sunrise Academy of Medical Specialities (India) (P.) Ltd Vs  ITO (Kerala High Court) - Sunrise Academy of Medical Specialities (India) (P.) Ltd Vs  ITO (Kerala High Court) (DB)  Any premium received by a Company on sale of shares, in excess of its face value; if the Company is not one in which the public has substantial interest, would be treated as income from other sources, as see...

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ITAT justified in not allowing set-off of share trading business loss against cash credit addition

Truptiben Bakulbhai Pate Vs ITO (Gujarat High Court): Tax Appeal No. 480 of 2017 - Truptiben Bakulbhai Pate Vs ITO (Gujarat High Court) As assessee had neither filed her return of income declaring loss nor had shown such loss in her books of account, this clearly indicated that assessee deliberately withhold the bank account and transactions recorded therein. Further, as she had n...

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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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Recent Posts in "Section 68"

ITAT on Assessment of share capital/ premium as unexplained cash credit

M/s. Priyatam Plaschem Pvt. Vs The Income Tax Officer (ITAT Delhi)

Priyatam Plaschem Pvt. Ltd Vs ITO (ITAT Delhi) In this case ITAT explains  Law on whether share capital/ share premium received by a Company from investors can be assessed as ‘unexplained cash credit’  in the light of judgements of the Courts and Tribunal. In the case in hand Considering the facts of the case, in […]...

Read More

Addition for Bogus Share Capital cannot be made on the basis of mere suspicion

PCIT Vs M/s. Acquatic Remedies Pvt. Ltd. (Bombay High Court)

Tribunal, on examination of facts, has come to the conclusion that the investment made by the shareholders is not hit by Section 68 of the Act. It records, that the entire basis of the Revenue's case is based on surmise that the respondent was taking bogus purchase bills and cash was introduced in the form of share capital without any ev...

Read More

Addition for Bogus Purchases based merely on statements and not backed by any material evidences is not sustainable

M/s. Aquatic Remedies Pvt. Ltd. Vs The DCIT (ITAT Mumbai)

M/s. Aquatic Remedies Pvt. Ltd. Vs The DCIT (ITAT Mumbai) The Revenue has alleged the assessee of taking bogus purchases and accommodation bills on account of such purchased. In our considered opinion this refers to two possibilities. 1) A person is purchasing goods from another person without any bill and then taking purchase bills from ...

Read More

Addition U/s. 68 rw section 56: Addition for share premium in excess of Fair Value

Sunrise Academy of Medical Specialities (India) (P.) Ltd Vs  ITO (Kerala High Court)

Sunrise Academy of Medical Specialities (India) (P.) Ltd Vs  ITO (Kerala High Court) (DB)  Any premium received by a Company on sale of shares, in excess of its face value; if the Company is not one in which the public has substantial interest, would be treated as income from other sources, as seen from Section […]...

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ITAT justified in not allowing set-off of share trading business loss against cash credit addition

Truptiben Bakulbhai Pate Vs ITO (Gujarat High Court): Tax Appeal No. 480 of 2017

Truptiben Bakulbhai Pate Vs ITO (Gujarat High Court) As assessee had neither filed her return of income declaring loss nor had shown such loss in her books of account, this clearly indicated that assessee deliberately withhold the bank account and transactions recorded therein. Further, as she had not furnished any explanation about non-d...

Read More

Brief Study of Section 269SS, 269T, 68 and 69 of Income Tax Act,1961

There are very few things in this world which are both Legal & Lethal. TAX is one of them. If tax provisions are not understood properly or tax is not paid in proper time, it is enough to give you hypertension. Moreover it is important to know what are the sections that affect your daily transactions and how these transactions are dealt w...

Read More
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Firm not Assessable for Unexplained Cash Credits for Capital Introduced by Partner

I.T.O. Vs Bajaj Roadways (ITAT Kolkata)

ITO Vs Bajaj Roadways (ITAT Kolkata) Revenue’s substantive ground seeking to revive unexplained cash credit addition of Rs.64, 10,000/- in assessee’ s partners’ capital Suffice to say, various judicial precedents have settled the law that such addition has to be made in the concerned partners’ hands than in case of a firm assesse...

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31000% increase in share value can be suspicious but cannot be evidence

Prakash Chand Bhutoria Vs. ITO (ITAT Kolkata)

The AO further relies on the shop increase of 31000% of the value of shares over the period of 2 years. Though this is highly suspicious, it cannot take the place of evidence. The Hon'ble Supreme Court has stated that suspicion however strong cannot be the basis for making an addition....

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Unexplained cash credits – Section 68 – Case Laws – Assessment

Section 68 of the I T Act is one of the most powerful yet debated provision of the I T Act. This provision has given plethora of judgments, sometimes conflicting, both in favour of Revenue and the assessee. In light of those judgements an attempt is made to analyse Section 68 with the following sub headings:...

Read More
Posted Under: Income Tax |

Accommodation entries from fake companies – Case Laws, Assessment Issues

When we refer to an entry of loan transaction as ‘fake loan’ received from a ‘paper company’, it invariably means that such entry represents unaccounted money of the person in whose books of account the money has been credited as loan and the lender company is only a conduit for routing the money back to the books of account of th...

Read More
Posted Under: Income Tax |

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