Section 6 of the Income Tax Act

To make an addition under Section 68 for unexplained cash credits, the Assessing Officer must conduct proper inquiry into the identity, genuineness, and creditworthiness of the creditor, especially concerning share application money. The assessee's initial discharge of burden by providing necessary details shifts the onus back to the AO for further investigation, including the source of source.

Taxing statutes must be interpreted strictly, assuming that the law-making authority does not commit a mistake or make an omission. There is no room for purposive interpretation under direct tax laws.

Orders that are inordinately delayed are liable to be recalled and heard afresh, and the Appellate Tribunal President should frame guidelines for timely disposal of appeals.

Not all receipts constitute income chargeable to tax. An Assessing Officer cannot reject a prima facie reasonable explanation on mere probabilities or arbitrary grounds, but must disprove facts.

An assessee found to be the owner of bullion, etc., must explain its source. The Income Tax Officer must find the assessee to be the owner, not merely in possession.

An Assessing Officer may reject the genuineness of a transaction if the evidence provided by the assessee is not trustworthy, even if the transaction appears to be conducted through cheques or other formal means. The burden of proving the genuineness of a transaction lies primarily on the assessee.

Issuance of a draft assessment order under section 144C(1) of the Income Tax Act is mandatory, and its non-issuance is not a curable procedural lapse.

Credit for tax deducted at source (TDS) must be granted to the taxpayer even if the income on which TDS was deducted is not taxable in India or if the obligation to deduct tax under a specific section is not affected by a Double Taxation Avoidance Agreement (DTAA).

Sums credited in the books of an assessee can be added as unexplained cash credits under Section 68 of the Income Tax Act if the explanation offered regarding their nature and source is not satisfactory.