Section 68 addition fails where no fresh credit arose in the year and shareholder strike-off alone is insufficient.

An addition under section 68 cannot be sustained unless the Assessing Officer proves an unexplained credit in the relevant year. Where no fresh money, share capital, or receipt was shown during the year under consideration, the mere striking off of the shareholder company under section 248(5) of the Companies Act, 2013 did not by itself establish a taxable credit. The assessee's case that the shareholding arose in an earlier year and no fresh transaction occurred during the year remained unrebutted, so the section 68 addition was deleted.

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Issues: Whether an addition under section 68 of the Income-tax Act, 1961 could be sustained merely because the shareholder company had been struck off, when no fresh money or share capital was received during the relevant year.

Analysis: The addition was made only because the shareholder company's name had been struck off under section 248(5) of the Companies Act, 2013. The record did not show any fresh credit, fresh share capital, or fresh receipt from that company in the relevant assessment year. For an addition under section 68, the Assessing Officer had to establish an unexplained credit in the year under consideration. The mere striking off of the shareholder company did not by itself prove a taxable credit in the relevant year, particularly when the assessee's case was that the shareholding arose in an earlier year and no fresh transaction occurred during the year in appeal.

Conclusion: The addition under section 68 was not sustainable and was deleted in favour of the assessee.

Ratio Decidendi: An addition under section 68 can be made only on proof of an unexplained credit in the relevant year, and the subsequent striking off of a shareholder company does not, by itself, render an earlier share capital transaction taxable.

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