INCOME TAX ACT, 1961

Section 261 Section 68

Appeal (Supreme Court) - Special leave petition - Unexplained cash credit - Applicability of proviso to section 68

Department preferred SLP to appeal against the judgment of Bombay High Court in Pr. CIT v. SDB State (P) Ltd. 2019 TaxPub(DT) 280 (Bom-HC), whereby the High Court held that the requirement to explain the source of funds in respect of amounts credited in the books of a company in which the public are not substantially interested as share application money was brought in the statute with the introduction of proviso to section 68 by Finance Act, 2012 with effect from 1-4-2013 and thus, it would have no application in respect of receipt of share application money received prior thereto. Held: The Supreme Court condoned delay and disposed of the SLP in terms of the order in SLP rendered in the case of CIT v. Gagandeep Infrastructure (P) Ltd. [SLP (C) No. 5759/2018, dated 2-4-2018 wherein the impugned order of Bombay High Court in CIT v. Gagandeep Infrastructure (P) Ltd. (2017) 394 ITR 680 (Bom) was modified with directions that the following question which also be considered in the appeal: '(i) Whether on facts and circumstances of the case and in law, the Tribunal was justified in deleting the addition of Rs. 7,53,50,000 under section 68 of the Act, being share capital/share premium received during the year when the AO held the same as unexplained cash credit'.