Dear pals,
AS we know sec 68 deals with cash credit it says that any amount which had been credited by the assessee in the P.Y. in his books which has not got any genuine reason or the reason offered by the assessee doesnt satisfy the ITO then he will consider the entire credited amt as his income for the previous year.
Here what is my question is, if any amt is credited by the assessee means it understood that credited amt is taxable isnt it?
FIRST
01. Assessing Officer “must” be satisfied
02. THIRD PARTY CROSS EXEMINATION IS TRUST.
03. genuine reason
OTHERWISE ITO ADDITION IN INCOME CASH CREDIT AMOUNT
Dear Friends,
According to explanation given in section 68 is that if any cash credit is made in the account and asseesse has no explanation regarding the source of income and or explanation given by assesse is not satisfaction to ito than such cash credit is taxable and not the entire amount deposited ..........
ok dear if any query remains to short out than plz ask i will try my level best to sort it out ok bye bye
Dear Poornima,
I think u want to ask that whethet ALL SUM credited by the assessee in his books shall be taxable u/s 68 or not??
Sec 68 says
1) amount must be credited in the previous year
AND
2) assessee has offerred no explanation or explanation offered by the assessee is not satisfactory..
THEN THE AMOUNT OF CREDIT MAY BE CHARGED TO INCOME TAX...
SO IF THE CREDIT AMOUNT IS DIVIDEND OR AGRICULTURE INCOME THEN IT CANNOT BE CHARGED TO TAX.. (BECAUSE THESE ARE NOT INCLUDED IN TOTAL INCOME AS PER SECTION 10)
FURTHER ANOTHER EXAMPLE WOULD BE TRANSFER FROM GENERAL RESERVE TO PROFIT AND LOSS A/C..(THIS CREDIT WOULD NOT BE TAXABLE)
well said every one...
Thanks for your detailed explanation.............
CAclubindia
