Income from unexplained cash credits
Any sum found credited in the company’s books without explanation is treated as income. If the company cannot establish the nature and source of the credit, it is deemed taxable under section sixty eight.

• Includes loans, advances, or capital credited without proper evidence
  
• Requires confirmation, identity, creditworthiness of creditor
  
• Unexplained cash credits are taxed at a higher rate without deductions
  
• Applies even if the credit is not part of regular business income
  

Income from unexplained investments
If a company is found to own assets or investments not recorded in its books, the value of such assets is treated as income under section sixty nine.

• Covers unrecorded investments in shares, property, or other instruments
  
• Income is taxed in the year it is discovered, not the year it was acquired
  
• No deductions or set-off of losses are allowed against such income
  
• The company must prove source of funds used for acquisition
  

Income from unrecorded expenditures
Where a company incurs expenditure and fails to explain the source of funding, the amount is deemed to be income under section sixty nine C.

• Applicable to unaccounted cash expenses or asset acquisitions
  
• No deduction is allowed for such unexplained expenditure
  
• Applies even if the expense is beneficial or legitimate in nature
  
• Books must clearly reflect the matching inflow or reserves
  

Excess stock found during survey
If during an income tax survey excess stock is found that is not reflected in the books, the difference is treated as deemed income under section sixty nine B.

• Stock value must be supported by purchase records and accounts
  
• Unaccounted stock is treated as income of the financial year discovered
  
• Burden is on the company to explain the discrepancy
  
• Valuation is done based on market price or actual cost basis
  

Income arising from cessation of liability
If a liability shown in the books is written back or ceases to exist without payment, it is treated as income under section forty one.

• Applies to trade payables, provisions, or loans no longer payable
  
• Income arises in the year of cessation or remission of liability
  
• Companies must account for such income in profit and loss statement
  
• Waiver of loan used for revenue purposes also falls under this section
  

Deemed dividends under tax provisions
When a closely held company gives loans or advances to its shareholders or concerns related to shareholders, it may be treated as deemed dividend under section two sub clause twenty two e.

• Applies only to companies other than those in which public is substantially interested
  
• Loans to substantial shareholders or related entities are covered
  
• Deemed dividend is taxable in the hands of the shareholder, not the company
  
• Proper board resolutions and shareholder disclosure must be maintained
  

Advance money forfeited for capital asset transfer
If a company receives advance money for transfer of a capital asset and forfeits it due to cancellation of agreement, it is treated as income under section fifty one.

• Earlier such forfeiture used to reduce cost of acquisition
  
• Now it is taxable as income in the year of forfeiture
  
• Applies even if the sale transaction does not take place
  
• Treated as income from other sources or capital gains based on context