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Commissioner Of Income-Tax vs Steller Investment Ltd. on 20 July, 2000

Commissioner of Income Tax vs Electro Polychem Ltd. reported at (2008) 217 CTR (Mad) 371 While dismissing the appeal of the revenue the Hon'ble High Court referred to the case of CIT v. Stellar Investment Ltd. (1991)192 ITR 287(Delhi) where the increase in subscribed capital of the respondent-company, accepted by the Income Tax Officer and rejected by the Commissioner on the ground that a detailed investigation was required regarding the genuineness of subscribers to share capital, as there was a device of converting black money by issuing shares, with the help of formation of an investment, which was reversed by the Tribunal, the Delhi High Court held that even if it is to be assumed that the subscribers to the increased share capital were not genuine, under no circumstances the amount of share capital could be regarded as undisclosed income of the company.
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