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“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

Abc Sales Corporation, Kannur vs. ACIT, Central Circle-1, Kozhikode

In the result, appeal of the assessee is hereby dismissed

ITA 449/COCH/2024[2018-2019]Status: DisposedITAT Cochin20 Dec 2024AY 2018-2019

Bench: Shri Waseem Ahmed & Shri Soundararajan K

Section 250

search, the tax authorities are expected to find and seize tangible evidence of undisclosed income or assets, such as: Undisclosed cash or bank accounts  Unexplained investments  Unaccounted-for jewelry or bullion  Property or shares not disclosed in tax returns  Digital evidence substantiating unaccounted income  13.5 If such evidence is missing ... hands of the assessee. 19. On the other hand, the learned DR before us contended that the search operation conducted uncovered significant unexplained investments and undisclosed foreign assets held by the ABC Group. It was revealed that the group’s flagship companies in Uganda, Qatar, and India were consolidated under

Abc Sales Corporation, Kannur vs. ACIT, Central Circle-1, Kozhikode

In the result, appeal of the assessee is hereby dismissed

ITA 441/COCH/2024[2017-2018]Status: DisposedITAT Cochin20 Dec 2024AY 2017-2018

Bench: Shri Waseem Ahmed & Shri Soundararajan K

Section 250

search, the tax authorities are expected to find and seize tangible evidence of undisclosed income or assets, such as: Undisclosed cash or bank accounts  Unexplained investments  Unaccounted-for jewelry or bullion  Property or shares not disclosed in tax returns  Digital evidence substantiating unaccounted income  13.5 If such evidence is missing ... hands of the assessee. 19. On the other hand, the learned DR before us contended that the search operation conducted uncovered significant unexplained investments and undisclosed foreign assets held by the ABC Group. It was revealed that the group’s flagship companies in Uganda, Qatar, and India were consolidated under

Abc Sales Corporation, Kannur vs. ACIT, Central Circle-1, Kozhikode

In the result, appeal of the assessee is hereby dismissed

ITA 440/COCH/2024[2017-2018]Status: DisposedITAT Cochin20 Dec 2024AY 2017-2018

Bench: Shri Waseem Ahmed & Shri Soundararajan K

Section 250

search, the tax authorities are expected to find and seize tangible evidence of undisclosed income or assets, such as: Undisclosed cash or bank accounts  Unexplained investments  Unaccounted-for jewelry or bullion  Property or shares not disclosed in tax returns  Digital evidence substantiating unaccounted income  13.5 If such evidence is missing ... hands of the assessee. 19. On the other hand, the learned DR before us contended that the search operation conducted uncovered significant unexplained investments and undisclosed foreign assets held by the ABC Group. It was revealed that the group’s flagship companies in Uganda, Qatar, and India were consolidated under

Abc Sales Corporation, Kasaragod vs. ACIT, Central Circle-1, Kozhikode

In the result, appeal of the assessee is hereby dismissed

ITA 439/COCH/2024[2017-2018]Status: DisposedITAT Cochin20 Dec 2024AY 2017-2018

Bench: Shri Waseem Ahmed & Shri Soundararajan K

Section 250

search, the tax authorities are expected to find and seize tangible evidence of undisclosed income or assets, such as: Undisclosed cash or bank accounts  Unexplained investments  Unaccounted-for jewelry or bullion  Property or shares not disclosed in tax returns  Digital evidence substantiating unaccounted income  13.5 If such evidence is missing ... hands of the assessee. 19. On the other hand, the learned DR before us contended that the search operation conducted uncovered significant unexplained investments and undisclosed foreign assets held by the ABC Group. It was revealed that the group’s flagship companies in Uganda, Qatar, and India were consolidated under

Bathx Bathware India Private Limited, Cochin vs. ACIT, Central Circle-1, Kozhikode

In the result, appeal of the assessee is hereby dismissed

ITA 438/COCH/2024[2016-2017]Status: DisposedITAT Cochin20 Dec 2024AY 2016-2017

Bench: Shri Waseem Ahmed & Shri Soundararajan K

Section 250

search, the tax authorities are expected to find and seize tangible evidence of undisclosed income or assets, such as: Undisclosed cash or bank accounts  Unexplained investments  Unaccounted-for jewelry or bullion  Property or shares not disclosed in tax returns  Digital evidence substantiating unaccounted income  13.5 If such evidence is missing ... hands of the assessee. 19. On the other hand, the learned DR before us contended that the search operation conducted uncovered significant unexplained investments and undisclosed foreign assets held by the ABC Group. It was revealed that the group’s flagship companies in Uganda, Qatar, and India were consolidated under

Bathx Bathware India Private Limited, Kochin vs. ACIT, Central Ircle-1, Kozhikode

In the result, appeal of the assessee is hereby dismissed

ITA 437/COCH/2024[2015-2016]Status: DisposedITAT Cochin20 Dec 2024AY 2015-2016

Bench: Shri Waseem Ahmed & Shri Soundararajan K

Section 250

search, the tax authorities are expected to find and seize tangible evidence of undisclosed income or assets, such as: Undisclosed cash or bank accounts  Unexplained investments  Unaccounted-for jewelry or bullion  Property or shares not disclosed in tax returns  Digital evidence substantiating unaccounted income  13.5 If such evidence is missing ... hands of the assessee. 19. On the other hand, the learned DR before us contended that the search operation conducted uncovered significant unexplained investments and undisclosed foreign assets held by the ABC Group. It was revealed that the group’s flagship companies in Uganda, Qatar, and India were consolidated under

Bathx Bathware India Private Limited, Kochin vs. ACIT, Central Circle-1, Kozhikode

In the result, appeal of the assessee is hereby dismissed

ITA 436/COCH/2024[2014-2015]Status: DisposedITAT Cochin20 Dec 2024AY 2014-2015

Bench: Shri Waseem Ahmed & Shri Soundararajan K

Section 250

search, the tax authorities are expected to find and seize tangible evidence of undisclosed income or assets, such as: Undisclosed cash or bank accounts  Unexplained investments  Unaccounted-for jewelry or bullion  Property or shares not disclosed in tax returns  Digital evidence substantiating unaccounted income  13.5 If such evidence is missing ... hands of the assessee. 19. On the other hand, the learned DR before us contended that the search operation conducted uncovered significant unexplained investments and undisclosed foreign assets held by the ABC Group. It was revealed that the group’s flagship companies in Uganda, Qatar, and India were consolidated under

A B C Sales Corporation, Kannur vs. ITO, Circle-1, Kannur

In the result, appeal of the assessee is hereby dismissed

ITA 404/COCH/2024[2017-2018]Status: DisposedITAT Cochin20 Dec 2024AY 2017-2018

Bench: Shri Waseem Ahmed & Shri Soundararajan K

Section 250

search, the tax authorities are expected to find and seize tangible evidence of undisclosed income or assets, such as: Undisclosed cash or bank accounts  Unexplained investments  Unaccounted-for jewelry or bullion  Property or shares not disclosed in tax returns  Digital evidence substantiating unaccounted income  13.5 If such evidence is missing ... hands of the assessee. 19. On the other hand, the learned DR before us contended that the search operation conducted uncovered significant unexplained investments and undisclosed foreign assets held by the ABC Group. It was revealed that the group’s flagship companies in Uganda, Qatar, and India were consolidated under

Abc Buildware India (P) Limited, Kannur vs. ITO, Circle-1, Kannur

In the result, appeal of the assessee is hereby dismissed

ITA 389/COCH/2024[2017-2018]Status: DisposedITAT Cochin20 Dec 2024AY 2017-2018

Bench: Shri Waseem Ahmed & Shri Soundararajan K

Section 250

search, the tax authorities are expected to find and seize tangible evidence of undisclosed income or assets, such as: Undisclosed cash or bank accounts  Unexplained investments  Unaccounted-for jewelry or bullion  Property or shares not disclosed in tax returns  Digital evidence substantiating unaccounted income  13.5 If such evidence is missing ... hands of the assessee. 19. On the other hand, the learned DR before us contended that the search operation conducted uncovered significant unexplained investments and undisclosed foreign assets held by the ABC Group. It was revealed that the group’s flagship companies in Uganda, Qatar, and India were consolidated under

Yuwam Education Pvt. Ltd., Jaipur vs. DCIT, Circle-6, Jaipur

ITA 1029/JPR/2024[2016-17]Status: DisposedITAT Jaipur20 Dec 2024AY 2016-17

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

For Appellant: Sh. P. C. Parwal, CAFor Respondent: Mrs. Anita Rinesh, JCIT-Sr. DR
Section 115BSection 143(2)Section 143(3)

sections 68/69/69A etc. the income is even if earned in earlier year but detected during the year in the form of unexplained credit/ unexplained investment etc. is to be taxed in the year in which the application of such income is found. Once sections 68/69/69A etc. are applicable, there ... business or profession, or capital gains, nor is it income from 'other sources' because the provisions of sections 69, 69A, 698 and 69C treat unexplained investments, unexplained money, bullion, etc., and unexplained expenditure as deemed income 14 Yuwam Education Pvt. Ltd. Jaipur vs. DCIT where the nature and source

Rekha Laxman Manjiramani, Mumbai vs. Income Tax Officer, Ward, 19(3)(1), Mumbai

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

ITA 5543/MUM/2024[2011-12]Status: DisposedITAT Mumbai20 Dec 2024AY 2011-12

Bench: Shri Om Prakash Kant () & Shri Sunil Kumar Singh () Assessment Year: 2011-12 Rekha Laxman Manjiramani, National Faceless Appeal Centre, 104, Lloyds Estates, G Wing Near Delhi, Income-Tax Officer-19(3)(1), Vs. Vidyalankar College, Piramal Chambers, Lalbaug, Mumbai-400037. Mumbai-400012. Pan No. Anhpm 5246 N Appellant Respondent

For Appellant: Mr. R.R. Makwana, Sr. DRFor Respondent: Mr. Ashish Mehta
Section 144Section 147Section 148Section 250

making an addition of INR 82,23,500/ in making an addition of INR 82,23,500/- on account of on account of alleged 'unexplained investment' under section 69 of the IT alleged 'unexplained investment' under section 69 of the IT alleged 'unexplained investment' under section ... escaped assessment. During the reassessment proceedings, the Assessing Officer During the reassessment proceedings, the Assessing Officer During the reassessment proceedings, the Assessing Officer observed unexplained investment u/s 69 of the Act amounting to observed unexplained investment u/s 69 of the Act amounting to observed unexplained investment

DCIT CC 7(4), Mumbai vs. Poddar Renaissance Reality Pvt Ltd (Now Known As Imperial Renaissaice Reniasance Reality Pvt. Ltd), Mumbai

In the result, the appeal of the In the result, the appeal of the Revenue is partly allowed

ITA 2045/MUM/2019[2012-13]Status: DisposedITAT Mumbai20 Dec 2024AY 2012-13

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhaildcit, Cc-7(4), Mumbai V/S. Poddar Renaissance Reality Room No. 659, Aaykar बनाम Pvt. Ltd. (Now Known As Bhavan, M.K. Road, Imperial Renaissance Mumbai-400020 Renaissance Reality Pvt. Ltd.) 501/601, Aqua Marine, Carter Road, Mumbai-400050030 "थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aagcp2657R Appellant/अपीलाथ" .. Respondent/"ितवादी

For Appellant: Mr. Rishabh MehtaFor Respondent: Mr. R. A. Dhyani
Section 143Section 143(3)Section 68Section 69

case, the Learned CIT(A) has erred in deleting the addition of Rs. 5,15,00,000/- made by the AO on account of unexplained investment u/s. 69 of the I.T. Act, 1961 without appreciating the P a g e | 2 ITA No. A.Y. 2012-13 Poddar Renaissance Reality ... completed on 13.03.2015, wherein addition of Rs. 5,15,00,000/ wherein addition of Rs. 5,15,00,000/- for unexplained investment plained investment and commission paid for purchase of the flats purchase of the flats along with addition

Basant Jain, Delhi vs. ACIT, Central Circle 29, Delhi

In the result, appeal filed by the assessee is partly allowed

ITA 2749/DEL/2023[2019-20]Status: DisposedITAT Delhi20 Dec 2024AY 2019-20

Bench: Shri Mahavir Singh & Shri S. Rifaur Rahmanassessment Year : 2019-20

For Appellant: Shri R.S. Singhvi, Adv.; &For Respondent: Shri N.K. Bansal, Sr. DR
Section 133ASection 143(2)Section 143(3)

Misc. Items Total value of excess jewellery stock 40,10,403 In view of the above facts, I hold that the appellant has made unexplained investment amounting to Rs.40,10,403/- as per the particulars given above. Accordingly, addition amounting to Rs.40,10,403/- is confirmed ... erred in upholding the addition of Rs. 40,10,403/- made u/s 69 of the Income Tax Act, 1961 on account of unexplained investment in the jewellery stock without properly appreciating the submissions filed by the Appellant. (ii) That the part of the excess stock found at the business premises

Brij Gopal Construction Company (P) Ltd., New Delhi vs. DCIT Central Circle-3, New Delhi

In the result, appeal filed by the assessee is partly allowed

ITA 2363/DEL/2023[2021-22]Status: DisposedITAT Delhi20 Dec 2024AY 2021-22

Bench: SHRI S.RIFAUR RAHMAN (Accountant Member), SHRI YOGESH KUMAR U.S. (Judicial Member)

For Appellant: Shri Gautam Jain, AdvocateFor Respondent: Ms. Nimisha Singh, CIT DR
Section 115BSection 132Section 139Section 153ASection 153DSection 69BSection 69C

addition made of Rs.2,77,79,000/- representing cash payment made to Chetak Enterprises for purchase of an old machinery and held as unexplained investment by invocation of section 69B read with section 115BBE of the Act and further addition made of Rs.1,00,00,000/- representing alleged cash payment ... representing alleged cash payment made to M/s Chetak Enterprises for purchase of an old machinery and held as unexplained investment by invocation of section 69B read with section 115BBE of the Act. 4.1 That while confirming the above addition, the learned Commissioner of Income Tax (Appeals) has failed to appreciate

Rekha Sanjeev Bhatt, Ahmedabad vs. The Income Tax Officer, Ward-2, Intl.Taxn., Ahmedabad

In the result, the appeal of the assessee is allowed

ITA 1025/AHD/2023[2021-22]Status: DisposedITAT Ahmedabad19 Dec 2024AY 2021-22

Bench: Smt.Annapurna Gupta & Shri Siddhartha Nautiyalassessment Year : 2021-22 Rekha Sanjeev Bhatt Vs. Ito, Ward-2 34, Paramgreen Bungalows International Tax Vill: Kolat,Tal: Sanand Ahmedabad. Ahmedabad. Pan : Bykpb 7551 A : Assessee By Shri Jaimin Shah, Ar Revenue By : Shri Rignesh Das, Sr.Dr सुनवाई क" तारीख/Date Of Hearing : 05/12/2024 घोषणा क" तारीख /Date Of Pronouncement: 19/12/2024 आदेश आदेश/O R D E R आदेश आदेश

For Respondent: Shri Rignesh Das, Sr.DR
Section 143(3)Section 144C(13)Section 144C(3)Section 144C(5)Section 69Section 69A

assessee for the aforementioned reason: i) Cash deposit in bank account remaining unexplained, under section 69A of the Act, of Rs.35,67,644/-; ii) Unexplained investment in immovable property, under section 69 of the Act ,of Rs.2,00,21,362/-; iii) Unexplained investment by way of stamp duty charges ... facts while making the additions of Rs.2,00,21,362/- u/s 69 of the IT. Act of on account of unexplained investment is against the fact and documentary evidence available on record and therefore it required to be deleted. 5. Ground No.1 was stated to be general in nature

Suryasri Poultry Complex, Kapavaram vs. The Income Tax Officer, Ward_1, Kakinada

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

ITA 188/VIZ/2024[2017-18]Status: DisposedITAT Visakhapatnam19 Dec 2024AY 2017-18

Bench: Shri K. Narasimha Chary, Hon’Ble & Shri S Balakrishnan, Hon’Bleआयकर अपील सं./I.T.A.No.188/Viz/2024 (निर्धारण वर्ा/ Assessment Year: 2017-18) Suryasri Poultry Complex V. Ito – Ward – 1 Income Tax Office D.No. 4-148, Rajanagaram Road Deepthi Towers Biccavolu Mandal, Kapavaram Main Road, Kakinada – 533001 East Godavari – 533343 Andhra Pradesh Andhra Pradesh [Pan: Abgfs6509P] (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent)

Section 143(2)Section 144Section 147Section 148Section 69Section 69A

making the following additions: - Sl.No. Details Amount 1. Unexplained Money under section 69A of the Act : Rs. 5,64,00,000 2. Unexplained investment under section 69 of the Act : Rs. 1,50,00,000 3. Being aggrieved by the order of the Ld. AO, assessee filed an appeal before

Assistant Commissioner of Income Tax, Central Circle-1, Trichy vs. Shri. Somasundaram Venkatesan, Pudukkottai

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

ITA 481/CHNY/2024[2018-19]Status: DisposedITAT Chennai19 Dec 2024AY 2018-19

Bench: Shri S.S. Viswanethra Ravi & Shri Jagadishआयकर अपील सं./I.T.A. No.481/Chny/2024 िनधा"रण वष"/Assessment Year: 2018-19 The Assistant Commissioner Of Vs. Shri Somasundaram Venkatesan, Income Tax, 4656, East Street, Central Circle 1, Pudukkottai 622 001. Trichy. [Pan:Abrpv2396J] (अपीलाथ"/Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By : Shri C. Murugesan, Addl. Cit ""थ" की ओर से/Respondent By : Shri R. Venkatesh, Fca सुनवाई की तारीख/ Date Of Hearing : 28.11.2024 घोषणा की तारीख /Date Of Pronouncement : 19.12.2024 आदेश /O R D E R Per S.S. Viswanethra Ravi: This Appeal Filed By The Revenue Is Directed Against The Order Dated 27.12.2023 Passed By The Ld. Commissioner Of Income Tax (Appeals) Chennai-19, Chennai For The Assessment Year 2018-19. 2. The Appellant-Revenue Raised Ground Nos. 2 To 2.3 Of Appeal Amongst Which The Only Issue Emanates For Our Consideration Is To Whether The Ld. Cit(A) Was Justified In Deleting The Value Of Excess Gold Stock In The Facts & Circumstances Of The Case.

For Appellant: Shri C. Murugesan, Addl. CITFor Respondent: Shri R. Venkatesh, FCA
Section 133ASection 142(1)Section 147

page 22 of the impugned order, observed that the assessee duly reconciled and satisfactorily explained excess gold stock, which cannot be treated as unexplained investment, consequently, directed the Assessing Officer to delete the same. The relevant part of which is reproduced herein below: 3 I.T.A. No.481/Chny/24 6.2.14 Further, bought ... satisfactorily explained the reasons for excess gold stock of 7840.534 grams found at the time of survey. Thus, the same cannot be treated as unexplained investment. Accordingly, all the grounds raised by the Appellant upon this issue are hereby treated as allowed, and the A.O. is hereby directed to delete

Neelesh Popley, Mumbai vs. Income-Tax Officer 22(2)(1), Mumbai

In the result, the appeal filed by the Assessee stands allowed

ITA 5145/MUM/2024[NEELESH POPLEY]Status: DisposedITAT Mumbai19 Dec 2024

Bench: Shri Narender Kumar Choudhryassessment Year: 2016-17

For Appellant: Shri Poojan Mehta, Ld. C.AFor Respondent: Shri Srinivas P., Ld. S.R. A.R
Section 142(1)Section 143(1)Section 147Section 148Section 250

this ground of appeal, the appellant has contended that the AO erred in making an addition of Rs.12,33,655/- as unexplained investment under section 69 of the Act by not considering the explanation of the appellant. As seen from the assessment order, the AO had examined the bank statements

Rishi Prakash vs. ITO Ward -43(1), New Delhi

ITA 818/DEL/2024[2010-11]Status: DisposedITAT Delhi19 Dec 2024AY 2010-11

Bench: Shri Satbeer Singh Godarau/S 147/144 U/S 271(1)(C) U/S 143(3) U/S 271(1)(C) U/S 143(3) U/S 271(1)(C) U/S 143(3) U/S 271(1)(C)

Section 1Section 143(3)Section 147Section 271(1)(c)Section 292C

emerges during the course of hearing that both the learned lower authorities have added Rs. 5,50,000/- on account of alleged unexplained investments followed by estimated commission(s) of Rs. 45,000/-, Rs. 3,93,350/- and 38,52,375/-; assessment year wise, respectively in assessee’s heads

Rishi Prakash vs. ITO Ward-43(1), New Delhi

ITA 817/DEL/2024[2010-11]Status: DisposedITAT Delhi19 Dec 2024AY 2010-11

Bench: Shri Satbeer Singh Godarau/S 147/144 U/S 271(1)(C) U/S 143(3) U/S 271(1)(C) U/S 143(3) U/S 271(1)(C) U/S 143(3) U/S 271(1)(C)

Section 1Section 143(3)Section 147Section 271(1)(c)Section 292C

emerges during the course of hearing that both the learned lower authorities have added Rs. 5,50,000/- on account of alleged unexplained investments followed by estimated commission(s) of Rs. 45,000/-, Rs. 3,93,350/- and 38,52,375/-; assessment year wise, respectively in assessee’s heads