In Brief
A steel company claimed to have received Rs. 17.6 crores in share capital from 14 investor companies. The tax authorities questioned the genuineness and found many investor companies non-existent or with negligible declared income. Despite the company producing banking proof and return acknowledgments, the Supreme Court held the company failed to discharge its legal burden under Section 68 of the Income Tax Act to prove investor identity, financial capacity, and transaction genuineness. The Court emphasized that independent field enquiries, not mere documentary proof, are essential. The addition of Rs. 17.6 crores to the company's taxable income was upheld, reversing lower court decisions that had deleted the addition.
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