“unexplained investment”

Cash Credits & Unexplained ItemsSection 69Section 695,821 judgments

The decision most relied on for unexplained investment is Sumati Dayal v. CIT (214 ITR 801), cited in 1,967 judgments on BharatTax.

Leading authorities on unexplained investment

Sumati Dayal v. CIT

214 ITR 801 · 1995 · Supreme Court

1,967

citing judgments

The Revenue is entitled to look behind the apparent form of a transaction to discover its true nature, applying the test of human probabilities and surrounding circumstances. If transactions defy logic or are unnatural, they can be treated as bogus, even if supported by some documentation, especially in cases of cash credits or unexplained investments.

K.P. Varghese v. ITO

131 ITR 597 · 1981 · Supreme Court

989

citing judgments

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.

Chuharmal v. CIT

172 ITR 250 · 1988 · Supreme Court

340

citing judgments

The expression 'income' under Section 69A of the Income-tax Act, 1961, has a wide meaning, encompassing anything that comes in or results in gain. Therefore, an assessee's unexplained investments, such as purchasing articles or depositing cash, can legitimately be inferred and deemed as income under this section.

CIT v. Kamdhenu Steel & Alloys Ltd.

361 ITR 220 · 2014 · High Court

328

citing judgments

When making an addition under section 68, the creditworthiness or financial strength of an investor contributing share capital or share application money can be proved by producing their bank statements showing sufficient balance for the investment. The Supreme Court dismissed the SLP against this decision.

CIT v. Dwarkadhish Investment (P) Ltd.

330 ITR 298 · 2011 · High Court

218

citing judgments

An assessee cannot be asked to explain the source of the source for cash credits, particularly share capital or share application money, once they have discharged the initial onus regarding the identity, genuineness of the transaction, and creditworthiness of the immediate investor.

CIT v. Jansampark Advertising & Marketing (P.) Ltd.

56 Taxmann.com 286 · 2015 · High Court

196

citing judgments

The Commissioner of Income-tax (Appeals) has an independent statutory obligation to conduct proper inquiries and verify facts, especially when the Assessing Officer has failed to do so. The CIT(A) must ensure effective inquiry is carried out before deleting additions or accepting additional evidence.

ITO v. Ch. Atchaiah

218 ITR 239 · 1996 · Supreme Court

149

citing judgments

Under the Income-tax Act, 1961, the Assessing Officer must tax any taxable income in the hands of the correct assessee to whom it truly belongs, having no option to assess it in any other person's hands.

CIT v. Stellar Investment Ltd.

192 ITR 287 · 1991 · High Court

146

citing judgments

Once the identity of the shareholders is established, no addition can be made in the hands of the assessee company under Section 68 for share capital or share application money, as it cannot be treated as undisclosed income.

Judgments citing unexplained investment

Prakash Misrimal Sanghvi, Ahmedabad vs. DCIT CC 1(1) Ahmedabad, Ahmedabad

In the result, the appeal of the Revenue in ITA No

ITA 1142/AHD/2024[2017-2018]Status: DisposedITAT Ahmedabad18 Feb 2025AY 2017-2018

Bench: Shri T.R. Senthil Kumar & Shri Narendra Prasad Sinhaआयकर अपील सं./I.T.A. Nos. 1138 To 1146/Ahd/2024 ("नधा"रण वष" / Assessment Years : 2013-14 To 2021-22) बनाम/ Prakash Misrimal Deputy Commissioner Of Sanghvi Income-Tax Vs. 17, Rajmugat Soc. Central Circle-1(1), Naranpura Char Rasta, Ahmedabad Naranpura, Ahmedabad 380013 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaeps7266A (Appellant) .. (Respondent)

For Appellant: Shri S. N. Soparkar, Sr. Advocate &For Respondent: Shri A. P. Singh, CIT-DR

Section 132Section 132(4)Section 143(3)Section 147Section 148

rejected the request of the assessee without any sound reason. By working out the peak, the Revenue was estimating the unexplained investment in the particular business as recorded in individual residual ledgers. Thus, the addition in respect of peak was mainly in respect of unexplained investment. The request ... assessee is that the benefit of telescoping of income already taxed in the earlier year should be allowed towards unexplained investment as worked out on the basis of peak value. This request of the assessee is found to be reasonable. Since, the income taxed till the preceding year was available

Prakash Misrimal Sanghvi, Ahmedabad vs. DCIT CC 1(1) Ahmedabad, Ahmedabad

In the result, the appeal of the Revenue in ITA No

ITA 1141/AHD/2024[2016-2017]Status: DisposedITAT Ahmedabad18 Feb 2025AY 2016-2017

For Appellant: Shri S. N. Soparkar, Sr. Advocate &For Respondent: Shri A. P. Singh, CIT-DR

Section 132Section 132(4)Section 143(3)Section 147Section 148

Prakash Misrimal Sanghvi, Ahmedabad vs. DCIT CC 1(1) Ahmedabad, Ahemedabad

In the result, the appeal of the Revenue in ITA No

ITA 1140/AHD/2024[2015-2016]Status: DisposedITAT Ahmedabad18 Feb 2025AY 2015-2016

For Appellant: Shri S. N. Soparkar, Sr. Advocate &For Respondent: Shri A. P. Singh, CIT-DR

Section 132Section 132(4)Section 143(3)Section 147Section 148

Prakash Misrimal Sanghvi, Ahmedabad vs. DCIT CC 1(1) Ahmedabad, Ahmedabad

In the result, the appeal of the Revenue in ITA No

ITA 1139/AHD/2024[2014-2015]Status: DisposedITAT Ahmedabad18 Feb 2025AY 2014-2015

For Appellant: Shri S. N. Soparkar, Sr. Advocate &For Respondent: Shri A. P. Singh, CIT-DR

Section 132Section 132(4)Section 143(3)Section 147Section 148

Prakash Misrimal Sanghvi, Ahmedabad vs. DCIT CC 1(1) Ahmedabad, Ahmedabad

In the result, the appeal of the Revenue in ITA No

ITA 1138/AHD/2024[2013-2014]Status: DisposedITAT Ahmedabad18 Feb 2025AY 2013-2014

For Appellant: Shri S. N. Soparkar, Sr. Advocate &For Respondent: Shri A. P. Singh, CIT-DR

Section 132Section 132(4)Section 143(3)Section 147Section 148

Assistant Commissioner of Income Tax, Central Circle 3(4), Hyderabad vs. Sv Multi Logitech Private Limited, Secunderabad

In the result, appeal filed by the Revenue is dismissed

ITA 82/HYD/2021[2016-17]Status: DisposedITAT Hyderabad18 Feb 2025AY 2016-17

Bench: Shri Manjunatha G. & Shri K.Narasimha Charyआ.अपी.सं /Ita No.81/Hyd/2021 & 82/Hyd/2021 (निर्धारण वर्ा/Assessment Year: 2015-16 & 2016-17) Asst.Commissioner Of Vs. S.V.Multi Logitech Income Tax Private Ltd. Central Circle-3(4) Secunderabad Hyderabad [Pan :Aascs7131D] (Appellant) (Respondent) निर्धाररती द्वधरध/Assessee By: Shri P.Murali Mohan Rao,Ar रधजस् व द्वधरध/Revenue By: Shri Srinath Sadanala, Dr सुिवधई की तधरीख/Date Of Hearing: 25/11/2024 घोर्णध की तधरीख/Date Of 18/02/2025 Pronouncement: आदेश / Order Per. Manjunatha G., A.M: These Appeals Filed By The Revenue Are Directed Against Order Dated 04.09.2020 Of The Commissioner Of Income Tax (Appeals) [“Ld.Cit(A)”]-11, Hyderabad Pertaining To A.Y.2015-16 & 2016-17. Since, Facts Are Identical & Issues Are Common, For The Sake Of Convenience, The Appeals Filed By The Revenue Are Being Heard Together & Are Being Disposed Off, By This Common Order. S.V.Multi Logitech Private Ltd.

For Appellant: Shri P.Murali Mohan Rao,ARFor Respondent: Shri Srinath Sadanala, DR

Section 132Section 143(1)Section 143(3)Section 153ASection 68

consideration from Ground No.14 of Revenue appeal is deletion of addition of Rs.1,19,87,500/- made u/s 69B of the Act towards unexplained investment in purchase of property. The Ld.DR, Shri Srinath Sadanala submitted that the Ld.CIT(A) erred in deleting the addition, holding that only part

Assistant Commissioner of Income Tax, Central Circle-3(4), Hyderabad vs. Sv Multi Logitech Private Limited, Secunderbad

In the result, appeal filed by the Revenue is dismissed

ITA 81/HYD/2021[2015-16]Status: DisposedITAT Hyderabad18 Feb 2025AY 2015-16

For Appellant: Shri P.Murali Mohan Rao,ARFor Respondent: Shri Srinath Sadanala, DR

Section 132Section 143(1)Section 143(3)Section 153ASection 68

Santosh Mohan Patole, Mumbai vs. Income Tax Officer - 34(3)(2), Mumbai

In the result appeal filed by the assessee stands allowed

ITA 5810/MUM/2024[2013-14]Status: DisposedITAT Mumbai18 Feb 2025AY 2013-14

Bench: Smt. Beena Pillai ()

Section 144Section 148Section 250

with the order, the assessee instituted the present appeal, where the only Ground taken was against the treatment of Rs. 40,00,000/- as Unexplained Investment, as concluded by the AO in the assessment order. 4.3. During the appeal proceedings, the assessee submitted his explanation, along with the documentary evidences

Bindya Ashok Dwara, Dubai, Uae vs. Commissioner of Income Tax (Appeals), Delhi

In the result, the appeal filed by the Assessee stands allowed for statistical purposes

ITA 4543/MUM/2024[2011-12]Status: DisposedITAT Mumbai18 Feb 2025AY 2011-12

Bench: Shri Narender Kumar Choudhry & Smt. Renu Jauhriassessment Year: 2011-12 Mrs. Bindya Ashok Dwara, Commissioner Of Income Flat No.204, Building 9, Tax (Appeals), Foxhill 9, Motor City, Government Of India, Dubai – 124055 Vs. Ministry Of Finance, Pan: Aknpd9713A Income Tax Department, National Faceless Appeal Centre (Nfac), Delhi – 110001 (Appellant) (Respondent) Present For: Assessee By : Shri Harman Sodhi, Ld. A.R. Revenue By : Ms. Monika H. Pande, Ld. Sr. D.R. Date Of Hearing : 18 . 12 .2024 Date Of Pronouncement : 18.02.2025 O R D E R

For Appellant: Shri Harman Sodhi, Ld. A.RFor Respondent: Ms. Monika H. Pande, Ld. Sr. D.R

Section 139(1)Section 147Section 148Section 250Section 69

considering the material available on record and the information, ultimately held the amount of Rs.1,47,90,000/- {value of the property} as unexplained investment u/s 69 of the Act and added the same in income of the Assessee. 3. The Assessee, being aggrieved, challenged the said addition before

Meena Hasmukh Savla, Matunga Mumbai vs. Assessment Unit, National Faceless Assessment Centre

In the result the appeal filed by the assessee is

ITA 2910/MUM/2024[2016-17]Status: DisposedITAT Mumbai18 Feb 2025AY 2016-17

Bench: Hon’Ble Shri Sandeep Gosain

Section 10Section 10(38)Section 143Section 143(1)Section 143(2)Section 147Section 148Section 151Section 250Section 68

sale of shares are genuine and therefore, The Assessing Officer was not justified in holding that the amount of Rs.1,41,08,484/-/ represented unexplained investment under section 69 of the Income Tax Act, 1961 cannot be faulted. 3.33 Attention is also drawn to another decision of the Jurisdictional High

Chandan Raltors P Ltd., Mumbai vs. ITO-14(1)(1), Mumbai

In the result, the appeal filed by the assessee stands partly

ITA 761/MUM/2021[2010-11]Status: DisposedITAT Mumbai18 Feb 2025AY 2010-11

Bench: Smt. Beena Pillai, Jm

Section 133(6)Section 143Section 147Section 148Section 69A

credit entries appearing in the bank statements which were not provided by the assessee. The Ld.AO thus treated the said amounts to be unexplained investment and made addition to the extent of the amount credited during the year in the accounts of the assessee held with Syndicate Bank

Vinod Kumar Agrawal, Bhind vs. Income Tax Officer Ward 2(1), Gwalior

Appeal is allowed for statistical purposes

ITA 107/AGR/2024[2015-16]Status: DisposedITAT Agra17 Feb 2025AY 2015-16

Bench: : Shri Satbeer Singh Godara & Shri Manoj Kumar Aggarwalassessment Year: 2015-16

Section 147Section 69

outset with the able assistance coming from both the parties that the learned Assessing Officer’s assessment dated 23.03.2023 made section 69 unexplained investment addition of Rs.64.94 lacs which stands confirmed only to the extent of cash payment of Rs.10,96,000/- in the lower appellate discussion. Faced with this

Karnam Rudrapillai Gunaseharan, Coimbatore vs. ITO, Corp. Ward-4, Coimbator

In the result, appeal filed by the assessee is allowed and the stay petition filed by the assessee is dismissed as academic

ITA 45/CHNY/2025[2017-18]Status: DisposedITAT Chennai17 Feb 2025AY 2017-18

Bench: Shri George George K, Hon’Ble & Shri S.R. Raghunatha, Hon’Bleआयकर अपील सं./Ita No.: 45/Chny/2025 & Sp No: 16/Chny/2025 िनधा"रण वष" / Assessment Year: 2017-18 Karnam Rudrapillai Gunaseharan, Income Tax Officer, 112, Mayflower Sakthi Garden, V. Corporate Ward -4, Nanjundapuram South, Coimbatore. Coimbatore South – 641 036. [Pan: Agxpg-7863-N] (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से/Appellant By : Shri. Arul Manian, Ca & Shri. Murugappa Boopathy, Advocate ""यथ" क" ओर से/Respondent By : Ms. Anitha, Addl. Cit सुनवाई क" तारीख/Date Of Hearing : 03.02.2025 घोषणा क" तारीख/Date Of Pronouncement : 17.02.2025

For Appellant: Shri. Arul Manian, CA &For Respondent: Ms. Anitha, Addl. CIT

Section 143(3)Section 69

Revenue to make addition u/s.69 or 69A of the Act. Because, the mandate of the provisions of Section 69 & 69A of the Act, i.e., unexplained investments and unexplained money etc., may be deemed to be the income of the assessee for the financial year relevant to :-15-: ITA. No: 45/Chny/2025 ... investment, needs to be examined. In case the assessee explains the nature and source of investment, then the question of making addition towards unexplained investment u/s. 69 of the Act does not arise. In this case, the source of deposits has not been disputed and has been created

Venkateswara Rao Koganti, Vijayawada vs. Assistant Commissioner of Income Tax, Circle-2(1), Vijayawada

In the result, appeal of the assessee is partly allowed for statistical

ITA 68/VIZ/2024[2017-18]Status: DisposedITAT Visakhapatnam14 Feb 2025AY 2017-18

Bench: Shri Laliet Kumar, Hon’Ble

Section 142Section 143(2)Section 143(3)Section 69A

being the difference Page No. 3 LT.A.No.68/VIZ/2024 Venkateswara Rao Koganti si between the DVO and the book value of the asset as unexplained investment in the hands of the assessee. 5. On being aggrieved by the additions made by the Ld. AO, assessee filed an appeal before ... NFAC erred both on facts and in law in confirming the addition of Rs.70,08,032/-, u/s 69B of the IT Act, being the unexplained investment pertaining to the alleged difference to the cost of construction estimated by DVO and as per books. 5.2 The Id. CIT(A) ignored

Chittikumari Kona, Vijayawada vs. Assessing Officer, Assessment Unit, New Delhi

ITA 322/VIZ/2024[2015-16]Status: DisposedITAT Visakhapatnam14 Feb 2025AY 2015-16

Section 139Section 147

आयकर अपीलीय अधिकरण, विशाखापटणम पीठ, विशाखापटणम IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM “SMC” BENCH, VISAKHAPATNAM (HYBRID HEARING) श्री के

Mujmmeel, Kota vs. ACIT-Central Circle, Kota

In the result, appeal of the assessee is allowed

ITA 620/JPR/2024[2020-21]Status: DisposedITAT Jaipur14 Feb 2025AY 2020-21

Bench: SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member), SHRI NARINDER KUMAR (Judicial Member)

For Appellant: Miss. Swatika Jha, AdvFor Respondent: Ms. Alka Gautam, CIT a

Section 115BSection 133ASection 139Section 143(2)Section 143(3)Section 263Section 69Section 69A

holding that in the impugned assessment order the Id. Assessing officer has failed to add the sum of Rs 1,44,35,000/- as unexplained investment of assessee u/s 69 consequently liable to be taxed u/s 115BBE. 1.3 That the impugned order dated 26.03.2024 passed by the learned Id. Principal ... supporting evidence as regard to the ownership of the transactions, the AO failed to add the sum of Rs 1,44,35,000/- as unexplained investment of assessee u/s 69 consequently, liable to be taxed u/s 115BBE of the Act. In the light of that observation ld. PCIT issued

Jai Tripati Steels Pvt Ltd, Ahmedabad vs. PCIT-1, Ahmedabad

In the result, the appeal of the assesse is allowed

ITA 933/AHD/2024[2015-16]Status: DisposedITAT Ahmedabad14 Feb 2025AY 2015-16

Bench: Smt.Annapurna Gupta & Shri Siddhartha Nautiyalassessment Year : 2015-16 Jai Tripati Steels P.Ltd. Vs. The Ld.Pr.Cit-1 402, Maurya Atria Ahmedabad. Opp: Kalgi Stats Bodakdev, Ahmedabad. Pan : Aabcj 5104 E (Applicant) (Responent) : Shri Chetan Agarwal, Ar Assessee By : Shri Prathvi Raj Meena, Cit-Dr Revenue By सुनवाई क" तारीख/Date Of Hearing : 26/12/2025 घोषणा क" तारीख /Date Of Pronouncement: 14/02/2025 आदेश आदेश/O R D E R आदेश आदेश

For Appellant: Shri Prathvi Raj Meena, CIT-DR

Section 147Section 263

loss to accommodate unaccounted money/income by way of using reverse trade mechanism in option derivative trading, there is no question of treating it an unexplained investments u/s 69 of the Act on account of under assessment of income, as proposed by your honour. In view of the above stated facts

Vijay Kantibhai Prajapti, Ahmedabad vs. The Iito, Ward-3(3)(15) Present the ITO, Ward-3(3)(5), Ahmedabad

In the result, the appeal filed by the assessee is partly allowed for statistical purposes

ITA 818/AHD/2023[2011-12]Status: DisposedITAT Ahmedabad14 Feb 2025AY 2011-12

Bench: Ms. Suchitra Kamble & Shri Narendra Prasad Sinha

For Appellant: Shri P F Jain, ARFor Respondent: Shri Rignesh Das, Sr. DR

Section 144Section 147Section 148Section 234Section 69

parte u/s.144 r.w.s. 147 of the Act on 07.12.2018, wherein addition of Rs.1.28 Crores was made u/s.69 of the Act on account of unexplained investment in land. 3. Aggrieved with the order of the AO, the assessee has filed an appeal before the Ld. CIT(A), which was decided vide

Dhas Kishor Ramchandra, Aurangabad vs. Dwarkaprasad Bhikulal Soni, Jalna

In the result, the appeal filed by the Revenue stands dismissed

ITA 1188/PUN/2024[2021-22]Status: DisposedITAT Pune14 Feb 2025AY 2021-22

Bench: SHRI R. K. PANDA (Vice President), SHRI VINAY BHAMORE (Judicial Member)

For Appellant: Shri Anand PartaniFor Respondent: Shri Amol Khairnar

Section 132(4)Section 50CSection 56(2)(x)Section 69C

circumstances of the case and in law, the Ld. CIT (A) erred in deleting the addition of Rs.23,10,817/- made on account of unexplained investment made in Fine Living Bungalow, Jalna by relying on the cash flow statement furnished by assessee though the assessee could not satisfactorily substantiated ... dismissed. 13. In ground no.8 and 9, the Revenue has challenged the deletion of addition of Rs.23,10,817/- made on account of unexplained investments in construction of bungalow. 13.1 In this regard, Ld. DR appearing from the side of the Revenue submitted before us that the assessee has constructed

Rajesh Kumar, Mainpuri vs. National Faceless Assessment Centre, Delhi

ITA 280/AGR/2024[2014-15]Status: DisposedITAT Agra13 Feb 2025AY 2014-15

Bench: : Shri Satbeer Singh Godara & Shri Manoj Kumar Aggarwal

Section 147Section 69

properties amounting to Rs.12.15 lakhs, to the extent of Rs.4,86,020/- i.e., 40%, respectively, there is no reason to sustain adhoc addition as unexplained investment u/s. 69 of the Act . This being the clinching fact emerging from the case file, we are of the considered view that such ... addition of unexplained investment u/s. 69 of the Act could not be made on mere estimation basis. We, thus, see merit in assessee’s sole substantive ground which stands allowed in very terms. 4. There being identical facts involved in the assessee’s latter appeal ITA No. 281/Agr/2024 barring difference