What is K.P. Varghese v. ITO authority for?

An addition to income cannot be made merely on the basis of a difference in valuation of assets or a Valuation Officer's report without establishing actual understatement of consideration or the source of unexplained funds through proper enquiry. The Assessing Officer must conduct proper enquiry and satisfy the conditions for making such additions.

How many judgments cite K.P. Varghese v. ITO?

989 judgments on BharatTax cite K.P. Varghese v. ITO (131 ITR 597), spanning 2000 to 2026.

Which sections of the Income Tax Act does K.P. Varghese v. ITO come up under?

It is most often cited in judgments turning on Section 143(3), Section 153A, Section 132, Section 292C, Section 69, Section 153C.

K.P. Varghese v. ITO (131 ITR 597)

DCIT, Central Circle-1(3), Bengaluru vs. Kanva Diagnostic Services Private Limited, Bengaluru

ITA 2231/BANG/2024[2016-17]Status: DisposedITAT Bangalore02 Jun 2025AY 2016-17

Bench: Shri Waseem Ahmed & Shri Keshav Dubey

For Appellant: Shri RE Balasubramanyam, CAFor Respondent: Smt. Srinandini Das, CIT and Shri Pranay Nahar

Section 132

…ich cannot be sustained on the elaborate reasoning already given in the earlier paras (7.1 to 7.9) with respect to the AYs 2014-15 to 2017-18. The decision of the Hon’ble Supreme Court relied upon by the AR of the Appellant in the case of K.P. Varghese v ITO [131 ITR 597] also supports the case of the Appellant. Accordingly, it is held . ITA No.2229 to 2233,2182 & CO 1 to 3/Bang/2024 & CO 1 to 3/Bang/2025 that the addition made by the AO amounting to Rs. 3,19,39,725/- deserves to be deleted. 8.6 Vide ground of appeal no 3 it is stated that the Assessing Officer made an error by adding Rs. 2.28 Crores as inco…

DCIT, Central Circle-1(3), Bengaluru vs. Kanva Diagnostic Services Private Limited, Bengaluru

ITA 2229/BANG/2024[2014-15]Status: DisposedITAT Bangalore02 Jun 2025AY 2014-15

Bench: Shri Waseem Ahmed & Shri Keshav Dubey

For Appellant: Shri RE Balasubramanyam, CAFor Respondent: Smt. Srinandini Das, CIT and Shri Pranay Nahar

Section 132

…ich cannot be sustained on the elaborate reasoning already given in the earlier paras (7.1 to 7.9) with respect to the AYs 2014-15 to 2017-18. The decision of the Hon’ble Supreme Court relied upon by the AR of the Appellant in the case of K.P. Varghese v ITO [131 ITR 597] also supports the case of the Appellant. Accordingly, it is held . ITA No.2229 to 2233,2182 & CO 1 to 3/Bang/2024 & CO 1 to 3/Bang/2025 that the addition made by the AO amounting to Rs. 3,19,39,725/- deserves to be deleted. 8.6 Vide ground of appeal no 3 it is stated that the Assessing Officer made an error by adding Rs. 2.28 Crores as inco…

Kanva Diagnostic Services Private Limited, Bangalore vs. DCIT - Central Circle, 1(3), Bangalore

ITA 2182/BANG/2024[2018-19]Status: DisposedITAT Bangalore02 Jun 2025AY 2018-19

Bench: Shri Waseem Ahmed & Shri Keshav Dubey

For Appellant: Shri RE Balasubramanyam, CAFor Respondent: Smt. Srinandini Das, CIT and Shri Pranay Nahar

Section 132

…ich cannot be sustained on the elaborate reasoning already given in the earlier paras (7.1 to 7.9) with respect to the AYs 2014-15 to 2017-18. The decision of the Hon’ble Supreme Court relied upon by the AR of the Appellant in the case of K.P. Varghese v ITO [131 ITR 597] also supports the case of the Appellant. Accordingly, it is held . ITA No.2229 to 2233,2182 & CO 1 to 3/Bang/2024 & CO 1 to 3/Bang/2025 that the addition made by the AO amounting to Rs. 3,19,39,725/- deserves to be deleted. 8.6 Vide ground of appeal no 3 it is stated that the Assessing Officer made an error by adding Rs. 2.28 Crores as inco…

Assistant Commissioner of Income Tax (Central Circle), Jammu vs. Anita Kapahi, Jammu

In the result, the appeal of the revenue is dismissed being devoid of merits

ITA 557/ASR/2024[2019-20]Status: DisposedITAT Amritsar29 May 2025AY 2019-20

Bench: Sh. Udayan Dasgupta & Sh. Krinwant Sahay

For Appellant: Sh. P. N. Arora, Adv

Section 131Section 132Section 133ASection 143(3)Section 250(6)Section 69

…document ever existed and that is the reason as to why it does not bear the signatures of the authorized persons, witnesses and the assessee). 19. Thereafter, he further referred to the decision of the Hon’ble Apex court in the case of K.P. Verghese vs ITO 131 ITR 597(SC), to submit that in the instant case there is no evidence to show that the assessee has paid on money for purchase of land. There is nothing to show that the contents on the loose sheet has been acted upon as per the terms stipulated therein. There is no trace of any cash payments neither in the registered deed sale, nor with the seller or…

Parsi Salsette Bldg No. 1 Chs Limited, Mumbai vs. Income Tax Officer 24(3)(1), Mumbai

Accordingly, Ground No. II raised by the Assessee is allowed and as a result, Ground No

ITA 1734/MUM/2025[2021-22]Status: DisposedITAT Mumbai27 May 2025AY 2021-22

Bench: SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY (Judicial Member)

For Appellant: Shri Haridas BhatFor Respondent: Shri Akhtar Hussain Ansari

Section 143(1)Section 143(3)Section 80Section 80PSection 80P(2)(d)Section 80P(4)

…IN THE INCOME TAX APPELLATE TRIBUNAL “H (SMC)” BENCH, MUMBAI SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER Parsi Salsette Bldg No. 1 CHS Limited Bldg. No.1, Salsette, Off Jijamata Road, Andheri East, Chakala MIDC S.O., Mumbai - 400093. Maharashtra. [PAN:AAABP0409Q] …………. Appellant Vs Income Tax Officer 24(3)(1), Mumbai Piramal Chamber, Mumbai – 400012. Maharashtra …………. Respondent Appearance For the Appellant/Assessee : Shri Haridas Bhat For the Respondent/Department : Shri Akhtar Hussain Ansari Date Conclusion of hearing : 24.04.2025 Pronouncement of order : 27.05.2025 O R D E R […

Kundalika Nagari Sahakari Patsanstha Maryadit, Roha vs. ITO, Ward 1, Panvel

In the result, appeal of the assessee is allowed

ITA 790/PUN/2025[2020-21]Status: DisposedITAT Pune22 May 2025AY 2020-21

Bench: Dr.Dipak P. Ripote & Shri Vinay Bhamoreआयकर अपील सं. / Ita No.790/Pun/2025 िनधा"रण वष" / Assessment Year: 2020-21 Kundalika Nagari Sahakari V The Income Tax Officer, Patsanstha Maryadit, S Ward-1, Panvel. Ground Floor, Varun Apartment, Near Bhate Vachanalaya, Sonar Ali, Roha – 402109. Maharashtra. Pan: Aacak6478R Appellant/ Assessee Respondent / Revenue Assessee By None Revenue By Shri Madhan Thirmanpallil – Addl.Cit(Dr) – Virtual Hearing. Date Of Hearing 13/05/2025 Date Of Pronouncement 22/05/2025

Section 143(3)Section 250Section 80PSection 80P(2)(a)Section 80P(2)(d)Section 80P(4)

…Firstly, the marginal note to section 80P which reads "Deduction in respect of income of co-operative societies" is important, in that it indicates the general "drift" of the provision. This was so held by this Court in K.P. Varghese v. ITO [1981] 7 Taxman 13/131 ITR 597 as follows: "9. This interpretation of sub-section (2) is strongly supported by the marginal note to Section 52 which reads "Consideration for transfer in cases of understatement". It is undoubtedly true that the marginal note to a section cannot be referred to for the purpose of construing the section but it can certainly be relied upon as indic…

DCIT-27(3), Vashi, Navi Mumbai vs. Varsha Enterprises, Navi Mumbai

In the result, the appeal of the Revenue is dismissed

ITA 1848/MUM/2025[2011-12]Status: DisposedITAT Mumbai19 May 2025AY 2011-12

Bench: Shri Amit Shukla & Shri Prabhash Shankar

For Appellant: Shri Devendra Jain, ARFor Respondent: Ms.Kavitha Kaushik, (Sr. DR)

Section 144Section 52(2)

…, Thane dated 3 March, 2022 wherein similar issue was dealt with in detail and the hon'ble Tribunal, in turn deleted similar addition in the case of the builder by placing heavy reliance on the hon'ble Supreme Court in the case of K. P. Varghese v. ΙΤΟ (1981) 131 ITR 597.It was inter alia observed that merely because of the reason of difference in the sale price of two different properties on two different times having differing locational advantages, in absence of any incriminating evidence cannot be compared and then result into the hands of the assessee as addition Page 9 ITA No. 1848/Mum/2025 Α.Υ. 2011-12 Var…

Income Tax Officer, Ward-8(3), Pune vs. M/S. Tata Motors Karmachari Sahakari Patpedhi Limited, Pune

In the result, appeal of the Revenue is dismissed

ITA 2529/PUN/2024[2017-18]Status: DisposedITAT Pune08 May 2025AY 2017-18

Bench: Dr.Dipak P. Ripote & Shri Vinay Bhamoreआयकर अपील सं. / Ita No.2529/Pun/2024 िनधा"रण वष" / Assessment Year: 2017-18 The Income Tax Officer, V Tata Motors Karmachari Ward-8(3), Pune. S. Sahakari Patpedhi, H 5 3Rd Floor, C/O.Tata Motors, Pune City, Pune – 411018. Pan: Aabat7682B Appellant/ Revenue Respondent / Assessee Assessee By Shri Sanket Joshi – Ar Revenue By Shri Abhinay Kumbhar – Cit(Dr) Date Of Hearing 06/05/2025 Date Of Pronouncement 08/05/2025 आदेश/ Order Per Dr. Dipak P. Ripote, Am: This Is An Appeal Filed By The Revenue Against The Order Of Ld.Commssioner Of Income Tax(Appeal)[Nfac] Passed Under Section 250 Of The Act, Dated 04.10.2024 For The A.Y.2017-18. The Revenue Has Raised The Following Grounds Of Appeal : “1. On The Facts & Circumstances Of The Case & In Law, The Learned Cit(A) Has Erred In Deleting The Disallowance Made By The Assessing Officer Of The Deduction Of Rs. 6,18,57,845/- Claimed Under Section Bop Of The Income-Tax Act, 1961 Being Interest Earned From The Investments

Section 250Section 56Section 80PSection 80P(2)Section 80P(2)(a)Section 80P(2)(d)

…to section 80P which reads "Deduction in respect of income of co-operative societies" is important, in that it indicates the general "drift" of the provision. This was so held ITA No.2529/PUN/2024 [R] by this Court in K.P. Varghese v. ITO [1981] 7 Taxman 13/131 ITR 597 as follows: "9. This interpretation of sub-section (2) is strongly supported by the marginal note to Section 52 which reads "Consideration for transfer in cases of understatement". It is undoubtedly true that the marginal note to a section cannot be referred to for the purpose of construing the section but it can certainly be relied upon as indic…

Rajesh Kumar Poonia, Jhunjhunu vs. Assistant Commissioner of Income Tax, Circle- Jhunjhunu, Jhunjhunu

In the result, both the appeals of the assessee are allowed

ITA 623/JPR/2024[2016-17]Status: DisposedITAT Jaipur06 May 2025AY 2016-17

Bench: DR. S. SEETHALAKSHMI (Judicial Member)

For Appellant: Sh. Vedant Agrawal, Adv. (V.C)For Respondent: Sh. Anup Singh, Add. CIT-DR

Section 131Section 133ASection 142(1)Section 143(2)Section 143(3)Section 145(3)

…officers of the Department are bound by the circulars of the board. Further in the following cases the Courts have held that circulars issued by the Board are binding: - (i) Navnit Lal C Javeri Vs. Sen (1965) 56 ITR 198 (SC) (ii) K.P. Varghese vs. ITO (1981) 131 ITR 597 (SC) (iii) UCO Bank vs. CIT (1999) 237 ITR 889 (SC) (iv) Union of India vs. Azadi Bachoo Andolan (2003) 263 ITR 706(SC) In the above decisions the Apex Court of the Country has reiterated that wherever CBDT has issued instructions/circulars to relieve hardships the same are of binding nature. In view of this it is submitted that the surrender of…

Rajesh Kumar Poonia, Jhunjhunu vs. Assistant Commissioner of Income Tax, Jhunjhunu

In the result, both the appeals of the assessee are allowed

ITA 611/JPR/2024[2017-18]Status: DisposedITAT Jaipur06 May 2025AY 2017-18

Bench: DR. S. SEETHALAKSHMI (Judicial Member)

For Appellant: Sh. Vedant Agrawal, Adv. (V.C)For Respondent: Sh. Anup Singh, Add. CIT-DR

Section 131Section 133ASection 142(1)Section 143(2)Section 143(3)Section 145(3)

…officers of the Department are bound by the circulars of the board. Further in the following cases the Courts have held that circulars issued by the Board are binding: - (i) Navnit Lal C Javeri Vs. Sen (1965) 56 ITR 198 (SC) (ii) K.P. Varghese vs. ITO (1981) 131 ITR 597 (SC) (iii) UCO Bank vs. CIT (1999) 237 ITR 889 (SC) (iv) Union of India vs. Azadi Bachoo Andolan (2003) 263 ITR 706(SC) In the above decisions the Apex Court of the Country has reiterated that wherever CBDT has issued instructions/circulars to relieve hardships the same are of binding nature. In view of this it is submitted that the surrender of…

Deputy Commissioner of Income Tax, Central Circle-3, Lic Building vs. Madhu Chordia, C-Scheme

In the result the appeal filed by the Revenue is dismissed

ITA 1525/JPR/2024[2017-18]Status: DisposedITAT Jaipur06 May 2025AY 2017-18

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI GAGAN GOYAL (Accountant Member)

For Appellant: Sh. Vinod Gupta, CAFor Respondent: Sh. Arvind Kumar, CIT-DR

Section 132(1)Section 139Section 143(3)Section 153ASection 69

…ind support from the statement of one of the seller which also proved the finding of the AO wrong by denying any cash involvement in the property transaction. Hence, in light of the judgement of Hon’ble Supreme court in the case of K P Varghese v/s ITO (1981) 131 ITR 597(SC), burden of proof was on the AO. The appellant has rightly contended that suspicion howsoever strong cannot take place of proof by taking reference of the judgement of Hon’ble Apex Court in the case of Umacharan Saha & Bros Co. v/s CIT 37 ITR 21 (SC). In view of the above totality of the facts and circumstances of the case and considering the…

Deputy Commissioner of Income Tax, Central Circle-3, Lic Building vs. Madhu Chordia, C-Scheme

In the result the appeal filed by the Revenue is dismissed

ITA 1520/JPR/2024[2015-16]Status: DisposedITAT Jaipur06 May 2025AY 2015-16

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI GAGAN GOYAL (Accountant Member)

For Appellant: Sh. Vinod Gupta, CAFor Respondent: Sh. Arvind Kumar, CIT-DR

Section 132(1)Section 139Section 143(3)Section 153ASection 69

…ind support from the statement of one of the seller which also proved the finding of the AO wrong by denying any cash involvement in the property transaction. Hence, in light of the judgement of Hon’ble Supreme court in the case of K P Varghese v/s ITO (1981) 131 ITR 597(SC), burden of proof was on the AO. The appellant has rightly contended that suspicion howsoever strong cannot take place of proof by taking reference of the judgement of Hon’ble Apex Court in the case of Umacharan Saha & Bros Co. v/s CIT 37 ITR 21 (SC). In view of the above totality of the facts and circumstances of the case and considering the…