Section 68 → Section 86
Cash credits
Quick Answer
Section 68 of the Income Tax Act, 1961 (Cash credits) corresponds to Section 86 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective 1st April 2026. Status: Retained.
Sec 68
Provision Summary
Any sum found credited in the books for which no satisfactory explanation is offered is taxed as unexplained cash credit.
Sec 86
Provision Summary
Retained and tightened. The onus of proving the source of funds, as well as the 'source of the source' (for share capital/premium), lies entirely on the assessee.
Key Changes & Highlights
- Taxed at an exorbitant flat rate (Section 115BBE) with no basic exemption limit or deductions allowed.
Related Sections
Frequently Asked Questions
What does Section 68 of the Income Tax Act 1961 deal with?
Section 68 (Cash credits) Any sum found credited in the books for which no satisfactory explanation is offered is taxed as unexplained cash credit.
What is the new section number for Section 68 under the Direct Tax Code 2025?
Section 68 of the ITA 1961 maps to Section 86 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective from 1st April 2026.
What is the status of Section 68 under the new tax code?
Section 68 is marked as "Retained" with status "Modified". Impact: Critical - Primary weapon against shell companies and black money.
What are the key changes to Section 68 under DTC 2025?
Taxed at an exorbitant flat rate (Section 115BBE) with no basic exemption limit or deductions allowed.
Disclaimer: This page is for educational and reference purposes only. Section mappings are based on publicly available drafts and circulars. Always consult a qualified Chartered Accountant before filing or making compliance decisions under the Direct Tax Code 2025.
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