TaxTMI 
TaxTMI 
2025 (2) TMI 922
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....r our consideration:- "A. Whether in the facts and circumstances of the case, the order of Ld. ITAT is erroneous in law as the Ld. ITAT has only considered cash credit to be taxable under the provisions of section 68, whereas the provision covers within its ambit 'any sum credited in the Books‟? B. Whether in the facts and circumstances of the case, the order of Ld. ITAT is erroneous and untenable in law as the Ld. ITAT has failed to consider that the impugned transaction is a colorable devise to avoid tax liability and the facts clearly show that the assessee party has made the credit/ debit entries in contravention of provisions laid by the Act? C. Whether in the facts and circumstances of the case, ....
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....ich the public are substantially interested), and the sum so credited consists of share application money, share capital, share premium or any such amount by whatever name called, any explanation offered by such assessee-company shall be deemed to be not satisfactory, unless- (a) the person, being a resident in whose name such credit is recorded in the books of such company also offers an explanation about the nature and source of such sum so credited; and (b) such explanation in the opinion of the Assessing Officer aforesaid has been found to be satisfactory: Provided also that nothing contained in the first proviso or second proviso shall apply if the person, in whose name the sum referred to therein is recorded....
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.... the Commissioner of Income Tax (Appeals) (CIT(A)) in its order had observed as follows: "5.3 I have perused the detailed submission including the copy of Board Resolution to allot shares of Rs.20 crores, form no. 5 to ROC (increase in share capital), notice calling extra ordinary general meeting of the member of the company, extracts of minutes of meeting and other materials which were filed before the AO and has been made a part of submission before me which is placed in the file. These documents go to demonstrate that the appellant has followed due procedure of increasing the authorized share capital and subsequently issue of shares to Sh. Surender kumar Kaushik, one of the directors/shareholders. xxxx xxxx xxxx ....
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....n that provisions of Section 68 have to come into play necessarily." 6. It is this view which has come to be affirmed by the Tribunal in its judgment which is questioned before us. The Tribunal while dealing with the aspect, has held as follows: "10. We have considered the rival arguments made by both the sides, perused the orders of the AO and the CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find, the AO, in the instant case, made addition of Rs.20 crores to the total income of the assessee u/s 68 of the IT Act being the amount of Rs.20 crores shown as goodwill and on which shares were issued in lieu of this goodwill to Mr. Surinder Kumar Kaushik. W....
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....lieu of goodwill. In the instant case, the assessee has debited goodwill account of Rs. 20 crores and, credited the same to share capital of Rs. 20 crores wherein the shares were allotted to Shri Surinder Kumar Kaushik towards goodwill. It has been held in various decisions that the provisions of section 68 can be applied if there is an actual receipt of money by the assessee whether by cash or cheque during the accounting year relevant to the assessment year under consideration. It has been held in these decisions that when the cash did not pass at any stage and when the respective parties did not receive cash nor did pay any cash, there was no real credit of cash in the cash book and, therefore, the question of inclusion of the amount of ....