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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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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Summary of Hon’ble Supreme Court ruling on Section 68 of Income Tax, 1961

Income Tax - Recently two judges’ bench of Hon’ble Supreme Court in the case of NRA Iron & Steel Pvt. Ltd. vs. Principal Commissioner of Income Tax (Central) – 1 (SLP (Civil) No. 29855 of 2018), by its judgment dated 5th March, 2019 restored the order of Assessing Officer by confirming the addition to the taxable income made under Section...

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Sec. 68 addition of share application money cannot be made if assessee explains nature & source of credit

ITO Vs M/s. Panchsheel Commotrade Pvt. Ltd. (ITAT Kolkata) - Since all the three conditions as required u/s. 68 i.e. the identity, creditworthiness and genuineness of the transaction was satisfied by assessee and the onus shifted to AO to disprove the materials placed before him, therefore, without doing so, the addition made by AO based on conjectures and su...

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AO cannot make Addition for capital gains from penny stocks on mere statement recorded by INV Wing

Shri Deepak Nagar Vs A.C.I.T (ITAT Delhi) - Addition under section 68 on account of bogus capital gains from penny stocks was not justified as AO had not conducted any independent and separate enquiry to prove that the transactions carried out by the assessee were not genuine or that the documents were not authentic and assessee had successfu...

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Receipt of share application money not taxable in case of non-resident

M/s. Shreenath Heritage Liquor Pvt Ltd. Vs ACIT (ITAT Jaipur) - Addition under section 68 on account of share application money received from non-resident was not justified as money brought into India by non-residents for investment or other purposes was not liable to Indian Income Tax....

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Addition for income from commodity transactions not justified if supporting details filed

ITO Vs M/s Prism Share Trading Pvt. Ltd. (ITAT Mumbai) - Where assessee had duly substantiated that it had earned a profit from commodities transactions along with complete details supporting the same, AO was not justified in treating the commodity transactions a fictitious arrangement with its associate concerns and adding the income as an unexplained ca...

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Addition U/s. 69 justified if creditors not found to be creditworthy

Shri Om Prakash Patidar (HUF) Vs ITO (ITAT Indor) - Shri Om Prakash Patidar (HUF) Vs ITO (ITAT Indore) Admittedly the appellant has received the amount in question and the amount is duly deposited in the bank account of the appellant and the appellant has failed to satisfactorily explain the source of the said deposits in his bank account and hence t...

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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"

Sec. 68 addition of share application money cannot be made if assessee explains nature & source of credit

ITO Vs M/s. Panchsheel Commotrade Pvt. Ltd. (ITAT Kolkata)

Since all the three conditions as required u/s. 68 i.e. the identity, creditworthiness and genuineness of the transaction was satisfied by assessee and the onus shifted to AO to disprove the materials placed before him, therefore, without doing so, the addition made by AO based on conjectures and surmises could not be justified....

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AO cannot make Addition for capital gains from penny stocks on mere statement recorded by INV Wing

Shri Deepak Nagar Vs A.C.I.T (ITAT Delhi)

Addition under section 68 on account of bogus capital gains from penny stocks was not justified as AO had not conducted any independent and separate enquiry to prove that the transactions carried out by the assessee were not genuine or that the documents were not authentic and assessee had successfully discharged the onus cast upon him by...

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Receipt of share application money not taxable in case of non-resident

M/s. Shreenath Heritage Liquor Pvt Ltd. Vs ACIT (ITAT Jaipur)

Addition under section 68 on account of share application money received from non-resident was not justified as money brought into India by non-residents for investment or other purposes was not liable to Indian Income Tax....

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Addition for income from commodity transactions not justified if supporting details filed

ITO Vs M/s Prism Share Trading Pvt. Ltd. (ITAT Mumbai)

Where assessee had duly substantiated that it had earned a profit from commodities transactions along with complete details supporting the same, AO was not justified in treating the commodity transactions a fictitious arrangement with its associate concerns and adding the income as an unexplained cash credit under Sec.68....

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Addition U/s. 69 justified if creditors not found to be creditworthy

Shri Om Prakash Patidar (HUF) Vs ITO (ITAT Indor)

Shri Om Prakash Patidar (HUF) Vs ITO (ITAT Indore) Admittedly the appellant has received the amount in question and the amount is duly deposited in the bank account of the appellant and the appellant has failed to satisfactorily explain the source of the said deposits in his bank account and hence the investment in the […]...

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AO cannot doubt share premium if he accepts receipt of share capital as genuine

ITO Vs Savera Towers (P) Ltd. (ITAT Kolkata)

Once receipt of share capital had been accepted as genuine within the ken of section 68 there was no reason for AO to doubt share premium component received from the very same shareholders as bogus in view of the fact that assessee had duly discharged burden cast on it to prove genuineness of transaction and identity and creditworthiness ...

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Genuineness / creditworthiness of parties from whom share capital/premium received

Pr. CIT Vs Adamine Construction (P) Ltd. (Delhi High Court)

Pr. CIT Vs Adamine Construction (P) Ltd. (Delhi High Court) The material on record in the form of the orders of the lower appellate authorities disclosed that both the assessee and later the share applicants (upon receiving notice under Section 131 of the Act) had produced documentary proof. These included the assessments and income-tax r...

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Sec 68 No additions if assessee proves identity of share applicants: SC

Pr. CIT Vs M/S. E Smart Systems Pvt. Ltd. (Supreme Court)

Pr. CIT Vs M/s. E Smart Systems Pvt. Ltd. (Supreme Court ) Supreme Court in this Case upheld the Judgment of Hon’ble Delhi High Court and dismissed the Special Leave Petition filed by Income Tax Department. High Court  held that AO did not dispute the veracity of the documents produced. Furthermore, the two individuals who [&hellip...

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Substantial justice deserves to be preferred over technical considerations

Pr. CIT Vs M/s. E Smart Systems Pvt. Ltd. (Delhi High Court)

Pr. CIT Vs M/s. E Smart Systems Pvt. Ltd. (Delhi High Court) It is relevant to state that AO in his remand report dated 10.10.2016 did not dispute the veracity of the additional evidences furnished by the assessee and further learned CIT(A) did not admit the additional evidences purely on technical ground which is wholly […]...

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Sec. 68 addition to be made in hands of share applicant for unexplained investment

ASR Wines [P] Ltd Vs ITO (ITAT Delhi)

Where AO was of the view that a shareholder of assessee-company had no means to make the subscription of share capital, AO could have asked the source of investment from the shareholder and if the source was not properly explained, addition could have been made in the hands of shareholder as unexplained income but no addition could be mad...

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