Section 56(2)(vii)(b) of the Income Tax Act

Income-tax Act, 2025: s.92

Section 56(2)(vii)(b) falls under section 56 of the Income-tax Act, 1961, which corresponds to section 92 (Income from other sources) of the Income-tax Act, 2025.

Read section 92 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 56(2)(vii)(b) is CIT v. Puneet Sabharwal (338 ITR 485), cited in 69 of the 626 judgments on BharatTax that turn on this section.

Leading authorities on Section 56(2)(vii)(b)

CIT v. Puneet Sabharwal
338 ITR 485 · 2011 · High Court
69
citing judgments

The revenue must prove that an assessee received extra consideration beyond the declared value; a Departmental Valuation Officer's (DVO) report alone is insufficient to establish such receipt.

Calcutta in Reliance Jute Industries Ltd. v. Income Tax Officer
150 ITR 643 · 1984 · High Court
23
citing judgments

The Assessing Officer (AO) is not required to refer the valuation to the District Valuation Officer (DVO) if the AO has conducted a detailed inquiry and is satisfied with the cost of construction. Strict adherence to procedural requirements is essential; failure to comply with mandatory conditions renders the assessment based on such non-compliance invalid.

Parekh Bros. v. CIT
150 ITR 105 · 1984 · High Court
21
citing judgments

The Department cannot take advantage of an assessee's ignorance, especially when a surrender is made solely to achieve peace and the assessee is not an expert in income tax matters.

Gateway Leasing (P.) Ltd. v. ACIT
117 Taxmann.com 442 · 2020 · High Court
20
citing judgments

A notice under section 148 of the Income Tax Act, 1961, issued after the expiry of four years from the end of the relevant assessment year, is barred by limitation if the original assessment was completed under section 143(3).

Joseph Mudaliar v. DCIT
130 Taxmann.com 250 · 2021 · Reported
18
citing judgments

The amendment to section 50C(1) of the Income Tax Act, 1961, by inserting the third proviso through the Finance Act, 2018, is curative and applies retrospectively. This means the tolerance band for the difference between sale consideration and stamp duty value, introduced by this amendment, is applicable to earlier assessment years.

Dalmia v. CIT
102 Taxmann 702 · Reported
17
citing judgments
CIT v. MEGHMANI ORGANICS LTD.
221 Taxmann 25 · 2014 · High Court
16
citing judgments

Assessments initiated without proper jurisdiction, such as under section 153C without the necessary foundation, are null and void and must be annulled.

Radha Kishan Kungwani v. ITO Ward
185 ITD 433 · ITAT
14
citing judgments

For the purpose of determining income under Section 56(2)(vii)(b) or 56(2)(x)(b), the stamp duty value or fair market value of immovable property is to be considered as on the date of payment made by the assessee towards booking of the property, where an agreement for purchase and payment of consideration has been made prior to the date of registration.

CIT v. Kay Arr Enterprises
299 ITR 348 · 2008 · High Court
13
citing judgments

A family arrangement or settlement does not give rise to any income. This is because it represents the working out of existing rights among family members rather than a transfer of property.

CIT v. Kamal Behari Lal Singha
82 ITR 460 · 1971 · Reported
13
citing judgments

The nature of a receipt as capital or revenue is determined by its character in the hands of the recipient, not the payer.

Judgments on Section 56(2)(vii)(b)

Sadhashiv Budhaji Sase, Mumbai vs. Commissioner of Income Tax (Appeal), NFAC, Mumbai

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

ITA 3001/MUM/2022[2014-15]Status: DisposedITAT Mumbai31 Jan 2023AY 2014-15

Bench: Shri Aby T. Varkey, Jm & Shri Om Prakash Kant, Am आयकर अपील सं/ I.T.A. No. 3001/Mum/2022 (निर्धारण वर्ा / Assessment Year: 2014-15) Sadhashiv Budhaji Sase बिधम/ Cit(A)/Nfac At-Bhisol Village Post- Ito, Ward-3(4), Kalyan Vs. Rayate, Tal-Kalyan, Dist- Rani Mansion, 2Nd Floor, Thane-Kalyan. Murbad Road, Kalyan 421301. स्थधयी लेखध सं./जीआइआर सं./Pan/Gir No. : Bqops5907B (अपीलार्थी /Appellant) .. (प्रत्यर्थी / Respondent) Assessee By: Shri S. M. Makhija Revenue By: Shri Aditya M. Rai (Sr. Ar) सुनवाई की तारीख / Date Of Hearing: 18/01/2023 घोषणा की तारीख /Date Of Pronouncement: 31/01/2023 आदेश / O R D E R Per Aby T. Varkey, Jm: This Is An Appeal Preferred By The Assessee Against The Order Of The Ld. Commissioner Of Income Tax (Appeals)/Nfac, Delhi Dated 27.09.2022 For Assessment Year 2014-15. 2. The Assessee Has Raised Seven (7) Grounds Of Appeal. However, The Main Grievance Of The Assessee Is Against The Action Of The Ld. Cit(A) Confirming The Addition Of Ao Amounting To Rs.93,98,000/- (Rs.47,82,000/- + 46,16,000/-) U/S 56(2)(Vii)(B) Of The Income Tax Act, 1961 (Hereinafter “The Act”). 3. Brief Fact Of The Case Is That The Assessee Is An Individual Who Derives Income From Commission & Brokerage For Consultation Of Sale & Purchase Of Land. & He Had Filed His Return Of Income On 27.03.2016 Declaring Total Income Of Rs.1,96,160/-, Which Return Of Income Was Later Selected For Scrutiny Under Cass. After Service Of Statutory Notices, The Assessee Was Directed To File Details Of Land

For Appellant: Shri S. M. MakhijaFor Respondent: Shri Aditya M. Rai (Sr. AR)
Section 56(2)Section 56(2)(vii)Section 68

ITO Corporate Ward 4(3), Chennai vs. Kaino Infra Development Private Ltd., Chennai

In the result, appeal filed by the Revenue is dismissed

ITA 1491/CHNY/2019[2015-16]Status: DisposedITAT Chennai12 Oct 2022AY 2015-16

Bench: Shri V. Durga Rao & Shri G. Manjunathaआयकर अपीलसं./I.T.A.No.1491/Chny/2019 ("नधा"रणवष" / Assessment Year: 2015-16) The Income Tax Officer, Vs M/S. Kaino Infra Development Corporate Ward-4(3) Pvt Ltd., Chennai-34. 37, Ttk Road, Alwarpet, Chennai-600 018. Pan: Aadcr 5655E (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ"क"ओरसे/ Appellant By : Mr. Ar V Sreenivasan, Addl.Cit For Mr. V.Vikekananthan, Cit ""यथ"क"ओरसे/Respondent By : Mr. G.Seetharaman, C.A. & Mr.S.Sundararaman, C.A सुनवाईक"तार"ख/Date Of Hearing : 15.07.2022 घोषणाक"तार"ख /Date Of Pronouncement : 12.10.2022 आदेश / O R D E R Per G. Manjunatha, Am: This Appeal Filed By The Revenue Is Directed Against The Order Of The Learned Commissioner Of Income Tax (Appeals)-8, Chennai Dated 31.01.2019 & Pertains To Assessment Year 2015-16. 2. The Revenue Has Raised Following Grounds Of Appeal:- “1. The Order Of The Ld.Cit(A) Is Contrary To Law & Facts Of The Case. 2. The Ld.Cit(A) Erred In Allowing The Assessee'S Appeal By Stating That The Assessee Company Has Sufficiently & Reasonably Justified The Share Premium Received Of Rs.168.60 Crores For The Year.

For Appellant: Mr. AR V Sreenivasan, Addl.CIT for Mr. V.Vikekananthan, CITFor Respondent: Mr. G.Seetharaman, C.A. &
Section 56(2)(vii)