“Section 56(2)”

Section References (mined)Section 56Section 56(2)1,770 judgments

The decision most relied on for Section 56(2) is Totgars Co-operative Sale Society Ltd. v. ITO (322 ITR 283), cited in 1,283 judgments on BharatTax.

Leading authorities on Section 56(2)

Totgars Co-operative Sale Society Ltd. v. ITO

322 ITR 283 · 2010 · Supreme Court

1,283

citing judgments

The interest income earned by a cooperative society from investing its surplus funds in fixed deposits with banks is not "derived from" its eligible business activities and is taxable as "income from other sources" under Section 56, thus not qualifying for deduction under Section 80P.

Pr. CIT v. Totagars

395 ITR 611 · 2017 · High Court

1,074

citing judgments

Interest income earned by a cooperative society from surplus deposits or investments held with a cooperative bank is not eligible for deduction under Section 80P(2)(d) of the Act.

Mavilayi Service Co-operative Bank Ltd. v. CIT

431 ITR 1 · 2021 · Supreme Court

999

citing judgments

Section 80P(4) serves as a proviso to Section 80P(1) and (2), excluding only cooperative banks that are cooperative societies and possess an RBI license for banking business. Its purpose is to exclude cooperative banks operating like commercial banks that lend money to the public.

CIT v. Sunbeam Auto Ltd.

332 ITR 167 · 2011 · High Court

897

citing judgments

The Commissioner cannot revise an assessment under Section 263 merely because the assessment order does not explicitly reflect an inquiry, or because the Commissioner holds a different opinion. An inquiry, even if considered inadequate, or an assessment based on a plausible view by the Assessing Officer after due examination, does not automatically make the order erroneous or prejudicial to the interests of the revenue.

Tumkur Merchants Souharda Credit Cooperative Ltd. v. ITO

230 Taxmann 309 · 2015 · High Court

527

citing judgments

A cooperative society is eligible for deduction under Section 80P(2)(a)(i) if it is engaged in cooperative activities. It also clarifies the allowability of deduction under Section 80P(2)(d) for interest income received from investments made in cooperative banks, after duly considering the Supreme Court's decision in Totgars Co-operative Sale Society Ltd.

Citizen Co-operative Society Ltd. v. ACIT

397 ITR 1 · 2017 · Supreme Court

499

citing judgments

A co-operative credit society engaged in banking business with the general public, accepting deposits from non-members and advancing loans to non-members, is treated as a co-operative bank. Such a society falls under the exclusionary clause of Section 80P(4) and is not eligible for deduction under Section 80P(2)(a)(i).

Totgar's Co-operative Sale Society Ltd. v. ITO

188 Taxmann 282 · 2010 · Supreme Court

486

citing judgments

Interest income earned by a co-operative society from investments, particularly with co-operative banks, is not eligible for deduction under Section 80P as it is not attributable to the core business activities of the society and constitutes "other income", not "profits and gains of business".

ITO v. D.G. Housing Projects Ltd.

343 ITR 329 · 2012 · High Court

438

citing judgments

For exercising revisional jurisdiction under Section 263, the Commissioner must first find that the Assessing Officer's order is erroneous and unsustainable in law, as this is a condition precedent. An order is not erroneous merely because two views are possible, or if the Commissioner disagrees with the Assessing Officer's permissible view, or to simply remit the matter for further enquiries.

Judgments citing Section 56(2)

Urusi Rahman, Kadma vs. ITO, Jamshedpur

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 257/RAN/2025[2017-18]Status: DisposedITAT Ranchi18 Dec 2025AY 2017-18

Bench: Shri Sonjoy Sarma & Shri Ratnesh Nandan Sahayi.T.A. No.257/Ran/2025 Assessment Year: 2017-18 Urusi Rahman….... …………….…….…............................……….……Appellant 88 New Rani Kodar, Line No.4, Po Kadma, Jamshedpur, Jharkhand- 831005. [Pan: Amxpr0867K] Vs. Ito, Jsr…..……………….....….…..….........……........……...…..…..Respondent Appearances By: Shri Shrawan Kr. Jha, Adv., Appeared On Behalf Of The Appellant. Shri Sumit Dasgupta, Sr. Dr, Appeared On Behalf Of The Respondent. Date Of Concluding The Hearing : December 11, 2025 Date Of Pronouncing The Order : December 18, 2025 Order Per Sonjoy Sarma: This Appeal Filed By The Assessee Is Directed Against The Order Of The Nfac, Delhi (Hereinafter Referred To As “Ld. Cit(A)”) Dated 27.05.2025 Passed Under Section 250 Of The Income-Tax Act, 1961 (Hereinafter Referred To As The “Act”). 2. Brief Facts Of The Case Are That The Assessee Did Not File Any Return Of Income For The Assessment Year 2017–18. Subsequently, The Case Was Reopened Under Section 147 Of The Income-Tax Act, 1961 On The Basis Of Information Received By The Assessing Officer That The Assessee Had Purchased An Immovable Property For A Declared Consideration Of ₹10,00,000, Whereas The Value Adopted For Stamp Duty Purposes Was ₹25,75,000. It Was Alleged That The Provisions Of Section 56(2)(Vii)(B) Of The Act Were Applicable. Accordingly, Notice Under Section 133(6) Was Issued Calling Upon The Assessee To Explain The Reasons For Not Filing The Return Of Income & To Furnish Details Regarding The Purchase Of The Property. However, There Was No Compliance By The Assessee. Thereafter, Notice Under Section 148 Of The Act Was Issued After Obtaining The Requisite Prior Approval From The Competent Authority. During The Course

Section 133(6)Section 147Section 148Section 250Section 56(2)(vii)Section 69

whereas the value adopted for stamp duty purposes was ₹25,75,000. It was alleged that the provisions of section 56(2)(vii)(b) of the Act were applicable. Accordingly, notice under section 133(6) was issued calling upon the assessee to explain the reasons for not filing the return ... Consequently, the assessment was completed ex parte. The Assessing Officer made an addition of ₹15,75,000 as income from other sources under section 56(2)(vii)(b) of the Act, being the difference between the stamp duty value and the declared purchase consideration. Further, an addition

Shankar Polmersetty, Bagbera Kitadih vs. ITO Ward 3(1), Jamshedpur

In the result the appeal of the assessee is allowed for statistical purposes

ITA 454/RAN/2024[2018-19]Status: DisposedITAT Ranchi18 Dec 2025AY 2018-19

Bench: Shri Sonjoy Sarma & Shri Ratnesh Nandan Sahayi.T.A. No.454/Ran/2024 Assessment Year: 2018-19 Shankar Polmersetty.... …………….…….…............................……….……Appellant H.No.12, Gel Church Mohlla, Gurudwara Road, Tatanagar, Ps Bagbera, Kitadih, Jharkhand- 831002. [Pan: Ajspp1582B] Vs. Ito, Ward-3(1), Jamshedpur.….....….…..….........……........……...…..…..Respondent Appearances By: Shri Shrawan Kr. Jha, Adv., Appeared On Behalf Of The Appellant. Shri Sumit Dasgupta, Sr. Dr, Appeared On Behalf Of The Respondent. Date Of Concluding The Hearing : December 17, 2025 Date Of Pronouncing The Order : December 18, 2025 Order Per Sonjoy Sarma: This Appeal Filed By The Assessee Is Directed Against The Order Of The Nfac, Delhi (Hereinafter Referred To As “Cit(A)”) Dated 12.11.2024 Passed Under Section 250 Of The Income-Tax Act, 1961 (Hereinafter Referred To As The “Act”). 2. Brief Facts Of The Case Are That The Assessment In The Case Of The Assessee Was Completed By Making An Addition Of ₹12,21,500 Under Section 56(2)(X) Of The Income-Tax Act, 1961. The Assessing Officer Noted That The Assessee Purchased A Flat For A Consideration Of ₹9,35,000, Whereas The Stamp Duty Value Adopted By The Stamp Valuation Authority Was ₹21,56,500. Accordingly, The Difference Was Treated As Income Under Section 56(2)(X) Of The Act. The Assessee Submitted That The Booking Of The Flat Was Made On 28.06.2010 & An Advance Payment Of ₹51,000 Was Made Through Account Payee Cheque On The Date Of Agreement. It Was Further Contended That The Property Is Situated In A Rural Area & The Stamp Duty Value As On The Date Of Agreement Was Much Lower Than

Section 250Section 56(2)(x)

case are that the assessment in the case of the assessee was completed by making an addition of ₹12,21,500 under section 56(2)(x) of the Income-tax Act, 1961. The Assessing Officer noted that the assessee purchased a flat for a consideration of ₹9,35,000, whereas ... stamp duty value adopted by the stamp valuation authority was ₹21,56,500. Accordingly, the difference was treated as income under section 56(2)(x) of the act. The assessee submitted that the booking of the flat was made on 28.06.2010, and an advance payment of ₹51,000 was made

Assistant Commissioner of Income Tax, Circle-1(1)(1), Bengaluru vs. Hirehal Jairaj Balram, Bengaluru

ITA 1961/BANG/2025[2020-21]Status: FixedITAT Bangalore18 Dec 2025AY 2020-21

Bench: Shri. Laxmi Prasad Sahu & Shri. Keshav Dubey

For Appellant: Shri. T. Srinivasa, CAFor Respondent: Shri. Balusamy N, JCIT(DR)(ITAT), Bangalore

Section 139(5)Section 143(1)Section 144Section 147Section 148Section 2(47)Section 250Section 50C

IN THE INCOME TAX APPELLATE TRIBUNAL "A" BENCH : BANGALORE BEFORE SHRI. LAXMI PRASAD SAHU, ACCOUNTANT MEMBER AND SHRI. KESHAV DUBEY

Sanjitha Reddy, Bangalore vs. Income Tax Officer, Ward-4(2)(1), Bangalore

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 1173/BANG/2025[2016-17]Status: DisposedITAT Bangalore18 Dec 2025AY 2016-17

Bench: Shri Laxmi Prasad Sahu & Shri Soundararajan K.Assessment Year : 2016-17

For Appellant: Shri H. Guruswamy, ITPFor Respondent: Shri Subramanian .S, JCIT-DR

Section 133(6)Section 142(1)Section 144BSection 148Section 250Section 56(2)(x)Section 69A

that most of the amounts were received by her as gifts from her relatives. The assessee also relied on the first proviso to section 56(2)(x)(c) of the Act and objected that the gifts received from the relatives could not be treated as income

Bir Singh, Faridabad vs. Income Tax Officer, Ward 1(1), Faridabad

In the result, appeal of assessee in ITA No

ITA 3969/DEL/2025[2017-18]Status: DisposedITAT Delhi17 Dec 2025AY 2017-18

Bench: Shri Anubhav Sharma & Shri Naveen Chandra

For Appellant: NoneFor Respondent: Shri Rajesh Kumar Dhanesta, Sr. DR

Section 10(37)Section 28Section 34Section 56(2)(viii)

will be exigible to tax under the "income from other sources" in view of amendment w.e.f 01.04.2010 in the provisions of section 56(2)(viii) and 57(iv) of the Act. 5. The issue is no longer integra. The issue has been decided by the Delhi ITAT Benches ... issue of taxability of interest received under section 28 of LAA as ‘income from other sources’ especially after the amended provision of section 56(2)(viii) and 145B(1) of the I T Act with effect from 01.04.2010. 20. It was in 2010, to align the law with the legislative

Brawny Nivesh P.Ltd, New Delhi vs. ACIT, Central Circle-13, New Delhi

In the result, appeal of the assessee is partly allowed

ITA 571/DEL/2019[2015-16]Status: DisposedITAT Delhi17 Dec 2025AY 2015-16

Bench: Shri Mahavir Singh & Shri Brajesh Kumar Singh

Section 143Section 143(3)Section 3Section 47Section 56Section 56(2)(via)Section 56(2)(viia)

unlisted equities during the year" and the AO raised necessary queries regards the details of investments in the shares and applicability of section 56(2)(via) to such investments. 2.1 Upon examination of the details submitted by the assessee, the AO noted that inter- alia the assessee had failed ... shares of Gain E Commerce Pvt. Ltd. and Kanti Commercial Pvt. Ltd. and also failed to explain as to why the provisions of section 56(2)(viia) of the I.T. Act, 1961 would not apply in the share purchase transaction in the above shares. The AO further noted that assessee

M/S Scania Commercial Vehicles India Pvt Ltfd, Bangalore vs. Deputy Commissioner of Income Tax Circle-6(1)(1), Bangalore

The Appeal of the Assessee is allowed

ITA 261/BANG/2022[2017-18]Status: DisposedITAT Bangalore16 Dec 2025AY 2017-18

Bench: Shri Prashant Maharishi, Vice – & Shri Keshav Dubey

For Appellant: Shri Narendra Kumar Jain, Advocate

Section 143(3)Section 68Section 92C

allowed. 28. Ground no. 3 of the Appeal is with respect to an addition of Rs. 198 crores under the provisions of section 56(2)(viib) of the Act for the reason for consideration received for issue of shares exceeding the fair market value of such shares. During the year ... share. ITA Nos. 261 & 777/Bang/2022 Page 12 of 18 29. It is the claim of the Assessee that, that provisions of section 56(2)(viib) of the Act are only attracted for the consideration for issue of shares as received from a resident. However, the Assessing Officer, in the draft

Raghavendra Ramakrishna Naik, Mumbai vs. ITO Int Tax Ward 3(3)(1), Mumbai

In the result, appeal of the assessee is allowed

ITA 2027/MUM/2025[2016-17]Status: DisposedITAT Mumbai16 Dec 2025AY 2016-17

Bench: Ms. Suchitra Raghunath Kamble & Shri Girish Agrawalassessment Year: 2016-17 Raghavendra Ramakrishna Vs Income Tax Officer, Ward Naik 3(3)(1), Mumbai Raghavendra Ramakrishna Room No. 626, 6Th Floor, Naik D-1, Flat No. 7, Navyouak Kautilya Bhavan, C-41 To C-43, Society, Bhandup East, G Block, Bandra Kurla Mumbai 400042 Complex, Bandra (East), Mumbai 400051 Pan: (Afapn9077M) Appellant Respondent Present For: Appellant By : Ms. Manisha Thakkar, Ca Respondent By : Shri. Krishna Kumar, Sr. Dr Date Of Hearing : 17.09.2025 Date Of Pronouncement : 16.12.2025 O R D E R Per Girish Agrawal: This Appeal Filed By The Assessee Is Against The Final Assessment Order Passed By Ld. Ito (Intl. Tax) Ward 3(3)(1), Mumbai-3 Vide Order No. Itba/Com/F/17/2024-25/1072645237(1) Dated 28.01.2025 Passed Pursuant To The Directions Of The Ld. Dispute Resolution Panel U/S. 144C(5) Of The Income-Tax Act, 1961 (Hereinafter Referred To As The “Act”), Dated 02.12.2024 For Ay 2016-17. 2. Grounds Taken By The Assessee Are Reproduced As Under: “1. The Applicant States That The Learned Income Tax Officer Has Erred In Passing The Order Which Is Illegal, Arbitrary & Against The Principle Laid

For Appellant: Ms. Manisha Thakkar, CAFor Respondent: Shri. Krishna Kumar, Sr. DR

Section 144CSection 144C(1)Section 144C(5)Section 148Section 56(2)Section 56(2)(vii)Section 56(2)(x)

same as a part purchase consideration for the purchase of the said flat and disregarding the Provisions of proviso to the section 56(2)(vii)(b)(ii) of the Act 3. On the Facts and Circumstances of the case, The DRP/ Ld. AO erred both on facts ... confirming the addition of Rs. 18,95,000/- disregarding the Proviso to Section 56(2)(vii) (b)(ii)of the Act, which stipulates that where the date of the agreement fixing the amount of consideration for the transfer/ purchase of immovable property (date of allotment 29.09.2010) and the date

Manekchand Devichand Bafna HUF, Mumbai vs. NFAC/ ITO, Ward-19(2)(2), Mumbai

In the result, assessee’s appeal is allowed

ITA 196/MUM/2025[2018-19]Status: DisposedITAT Mumbai16 Dec 2025AY 2018-19

Bench: Shri Narender Kumar Choudhry (Jm) & Shri Prabhash Shankar (Am) Manekchand Devichand Bafna Ito-19(2)(2) Huf Piramal Chamber 2/22, Racha Building No. 2 Steater Vs. Lalbaugh, Parel Road, Tardeo Mumbai-400 012. Mumbai-400 007. Pan : Aaehm0193G Appellant Respondent

For Appellant: Shri Vimal Punmiya, Ld. CAFor Respondent: Shri Bhagirath Ramawat, Ld. DR

Section 250Section 56(2)(x)

only, which is admittedly not more than 10% the tolerance limit, as introduced in section 56(2)(x)(b)(ii) of the Act. Hence, the addition of Rs. 3,91,000/- made under section 56(2)(x) of the Act by Assessing Officer and affirmed by Ld. Commissioner, is unsustainable

Ketan Himatlal Mehta, Mumbai, Maharashtra vs. NFAC, Not Applicable

Appeal is partly allowed

ITA 2499/MUM/2024[2020-21]Status: DisposedITAT Mumbai16 Dec 2025AY 2020-21

Bench: SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY (Judicial Member)

For Appellant: Shri Rakesh JoshiFor Respondent: Shri Pravin Salunkhe

Section 143(3)Section 144BSection 32MSection 56(2)(x)

INR.8,70,68,190/-, the Assessing Officer made addition of INR.18,48,70,810/- (INR.27,19,39,000 - INR.8,70,68,190/-) under Section 56(2)(x) of Act vide Assessment Order, dated 23/09/2022. 4 Assessment Year 2020-2021 5. The appeal preferred by the Assessee challenging the aforesaid addition ... yield any favorable results as the CIT(A) confirmed the addition made by the Assessing Officer under Section 56(2)(x) of the Act and dismissed the appeal holding as under: “7. The appellant has purchased/acquired one property for a transaction value of Rs. 8,70,68,190/- during

Gurdev Singh, Pinjore vs. Income Tax Officer, Ward 4. Panchkula, Panchkula

In the result, the appeal of the assessee is dismissed

ITA 817/CHANDI/2025[2015-16]Status: DisposedITAT Chandigarh15 Dec 2025AY 2015-16

Bench: the Ld. CIT(A). Before the Ld CIT(A), the assessee contended that interest received under Section 28 of the Land Acquisition Act forms part of compensation for rural agricultural land and is exempt U/S Section 10(37), relying on Supreme Court rulings such as Ghanshyam (HUF) and Hari Singh.

For Appellant: Smt. Neelam Dhiman, CA(Virtual Mode)For Respondent: Shri Vivek Vardhan, Addl. CIT, Sr. DR

Section 10(37)Section 145BSection 145B(1)Section 28Section 56(2)(viii)Section 57

Supreme Court rulings such as Ghanshyam (HUF) and Hari Singh. 4.1 The CIT(A) rejected these arguments, holding that post-Finance Act 2009, Section 56(2)(viii) specifically taxes interest on compensation or enhanced compensation as “Income from Other Sources”, with a 50% deduction under Section 57(iv). Relying ... 463/Chd/2023), forming part of the consolidated order in land-acquisition matters. 5.1 It was argued that after insertion of sections 56(2)(viii) and 145B(1), all interest received on compensation or enhanced compensation—whether under section 28 or 34 is taxable in the year of receipt, and the earlier

Daljit Kaur, Haryana vs. ITO, Ward-1, Sirsa, Haryana

In the result, the appeal of the assessee is dismissed

ITA 697/CHANDI/2025[2018-19]Status: DisposedITAT Chandigarh15 Dec 2025AY 2018-19

Bench: SHRI. LALIET KUMAR (Judicial Member), SHRI. KRINWANT SAHAY (Accountant Member)

For Appellant: Shri Parikshit Aggarwal, C.A (Virtual Mode)For Respondent: Shri Vivek Vardhan, Addl. CIT, Sr. DR

Section 56(2)(viii)Section 57

compensation. 4.1 During assessment, the AO observed from the return that the assessee had received interest on enhanced compensation within the meaning of Section 56(2)(viii) of the Income-tax Act and had claimed the entire amount as exempt. The AO issued a show-cause notice dated 09.10.2020, proposing ... grounds of appeal, the assessee’s submissions, and applicable judicial precedents, proceeded to examine whether interest on enhanced compensation is taxable under Section 56(2)(viii). The Ld. CIT(A) embarked on an extensive analysis of Supreme Court jurisprudence beginning with the landmark judgment in Dr. Shamlal Narula (1964), wherein

Aadarsh Surana, Chennai vs. Deputy Commissioner of Income Tax, Corporate Circle 1(1), Chennai

In the result, the appeal of the assessee is allowed

ITA 1840/CHNY/2025[2017-18]Status: DisposedITAT Chennai15 Dec 2025AY 2017-18

For Appellant: Shri. R.Venkata Raman, C.AFor Respondent: Shri. Shiva Srinivas, CIT

Section 142(1)Section 143(2)Section 143(3)Section 250Section 47Section 68

squarely fall within the statutory definition of "relatives," and therefore, by express legislative exclusion, such receipts do not attract the operation of section 56(2)(x) of the Act. 52. The Ld. AR emphasised that section 68 of the Act is a deeming provision intended to cover unexplained or unsubstantiated ... premise of alleged abnormal valuation of the assets transferred. 69. It was further submitted that in terms of the provisions of section 56(2)(x) of the Act, any receipt of immovable property from persons falling within the definition of "relative" is specifically excluded from the ambit of taxation

Himmatbhai Madhabhai Patel, Ahmedabad vs. The ITO, Ward-5(3)(1), Ahmedabad

In the result, appeal of the assessee is allowed

ITA 1552/AHD/2025[2015-16]Status: HeardITAT Ahmedabad12 Dec 2025AY 2015-16

Bench: Dr. B.R.R. Kumar, Vice-Shri Siddhartha Nautiyalhimmatbhai M. Patel, Vs. Ito, 18, Kailash Dham Part-2, Ward 5(3)(1), India Colony Road, Bapunagar, Ahmedabad Ahmedabad-380024 [Pan :Aanpd 2497 D] (Appellant) .. (Respondent) Assessee By : Shri S.N. Divetia & Shri Samir Vora, Ars Respondent By: Shri Kamal Deep Singh, Sr Dr Date Of Hearing 11.12.2025 Date Of Pronouncement 12.12.2025

For Appellant: Shri S.N. Divetia & Shri Samir Vora, ARsFor Respondent: Shri Kamal Deep Singh, Sr DR

Section 143(3)Section 250Section 263Section 56Section 56(2)(vii)

ground nos. 1 to 4, therefore, ground Nos. 1 to 4 are decided against the assessee. “ 4. In this background, the provisions of Section 56(2)(vii)(b) of the Act are examined. The same reads as under:- (x) where any person receives, in any previous year, from any person