“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

Kk Radhakrishnan, Kannur vs. DCIT Central Circle 2, Kozhikode

In the result, the assessee’s appeal is disposed on the aforesaid terms, and stay application is dismissed as infructuous

ITA 494/COCH/2023[2008-09]Status: DisposedITAT Cochin12 Jan 2024AY 2008-09

Bench: Shri Sanjay Arora & Shri Manomohan Das & Sa No. 104/Coch/2023 (Assessment Year: 2008-09)

For Appellant: Shri Pavan Ved, AdvocateFor Respondent: Smt. J.M. Jamuna Devi, Sr. D.R

Section 132(1)Section 153ASection 153CSection 153D

validity of approval given by ld. JCIT u/s.153D. 3. The ld. CIT(A) erred in confirming the addition of Rs.1,37,50,000 for unexplained investment in property at Bangalore. ITA No. 494/Coch/2023& SA 104/Coch/2023 K.K. Radhakrishnan v. Dy. CIT(AY: 2008-09) 4. The ld. CIT(A) erred

Assistant Commissioner of Income Tax (Central)-1, Indore vs. Shri Ritesh Jain, Indore

ITA 794/IND/2018[2010-11]Status: DisposedITAT Indore12 Jan 2024AY 2010-11

Bench: Shri Vijay Pal Rao & Shri B.M. Biyani & It(Ss)Ano.14/Ind/2022 (Assesssment Year 2011-12

Section 139Section 143(2)Section 147Section 148

either found in the books of the assessee or recorded in the LPS-2 pertaining to the assessee then the addition on account of unexplained investment u/s 69 of the Act cannot be made. The AO has made this addition purely on the basis of the statement of the assessee

Anuj Chaudhary, Ghaziabad vs. ITO, Ward- 1(1), Ghaziabad

ITA 3453/DEL/2018[2009-10]Status: DisposedITAT Delhi12 Jan 2024AY 2009-10

Bench: Shri M. Balaganesh & Shri Anubhav Sharma

For Appellant: Dr. Rakesh Gupta, AdvFor Respondent: Date of Hearing

Section 139Section 144Section 147Section 148Section 69

read section 147 of the Act on 09.12.2016 after making addition towards cash deposits in saving bank account of Rs. 13,47,000/- and unexplained investment in purchase of land of Rs. 42 lakhs. The Id CIT(A) upheld the addition made by the Id AO towards unexplained investment

Smt Kotyala Sujatha L/R of Kotyala Kumara Swamy, Tadepalligudem vs. The Income Tax Officer, Ward-1, Tadepalligudem

In the result, appeal of the assessee is dismissed

ITA 697/VIZ/2019[2004-05]Status: DisposedITAT Visakhapatnam11 Jan 2024AY 2004-05

Bench: Shri Duvvuru Rl Reddy, Hon’Ble

For Appellant: Sri GVN Hari, ARFor Respondent: Sri Madhukar Aves, Sr. AR

Section 133ASection 143(3)Section 154Section 69

penal proceedings in this regard. Accordingly, the Ld. AO made addition of Rs. 4 35,96,210/- U/s. 69 of the Act towards unexplained investment being the differential consideration amount and passed the assessment order U/s. 143(3) of the Act on 29/03/2005. Thereafter, the assessee filed a rectification petition ... assessee’s title on the property, there was no transaction in this regard and hence the addition made by the Ld. AO towards unexplained investment was liable to be deleted. The Ld. AO dismissed the rectification petition filed by the assessee U/s. 154 vide order dated 17/4/2006 by holding that

Mudita Chaturvedi, New Delhi vs. ACIT, Central Circle-20, Delhi

In the result, the appeal of the assessee is allowed

ITA 601/DEL/2023[2019-20]Status: DisposedITAT Delhi11 Jan 2024AY 2019-20

Bench: Sh. N. K. Billaiya & Sh. Yogesh Kumar U.S.Assessment Year: 2019-20 Mudita Chaturvedi Vs. Acit C-26, Defence Colony, New Central Circle – 20 Delhi-110024 Delhi Pan No.Alopc6621J (Appellant) (Respondent) Appellant By Sh. Gaurav Jain, Advocate Sh. Sudarshan Roy, Advocate Respondent By Ms. Pooja Swaroop, Sr. Dr Date Of Hearing: 08/01/2024 Date Of Pronouncement: 10/01/2024

Section 132Section 69

jewellery of 719.916 grams found in the locker and to show cause as to why the jewellery found should not be taxed as unexplained investment u/s. 69 of the Act. 5. Assessee filed a detailed reply explaining that the jewellery found in the locker is Stri Dhan of the assessee ... assessee 100 grams each belonging to her husband and minor child and excess above 700 grams i.e. 19 grams was treated as unexplained investment u/s. 69 of the Act r.w.s. 115BBE. 7. Assessee carried the matter before the CIT(A) and reiterated its claim of Stri Dhan etc. 8. After

Shri Subramaniam Elangovan, Chennai vs. ITO, Non Corporate Ward-1(2), Chennai

In the result, the appeal filed by the assessee is allowed for statistical purposes and the stay petition is dismissed

ITA 1074/CHNY/2023[2011-12]Status: DisposedITAT Chennai10 Jan 2024AY 2011-12

Bench: Shri V. Durga Rao & Shri G. Manjunathaआयकर अपील सं./I.T.A. No.1074/Chny/2023 िनधा"रण वष"/Assessment Years: 2011-12 & S.P. No. 42/Chny/2023 [In I.T.A. No. 1074/Chny/2023 Subramaniam Elangovan, Vs. The Income Tax Officer, No. 37, Laxarus Church, 2Nd Lane, Non-Corporate Ward 1(2), Raja Annamalaipuram, Chennai. Chennai 600 028. [Pan:Aaape2824Q] (अपीलाथ"/Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By : Shri T. Vasudevan, Advocate ""थ" की ओर से/Respondent By : Shri D. Hema Bhupal, Jcit सुनवाई की तारीख/ Date Of Hearing : 04.01.2024 घोषणा की तारीख /Date Of Pronouncement : 10.01.2024 आदेश /O R D E R Per V. Durga Rao: This Appeal Filed By The Assessee Is Directed Against The Order Of The Ld. Commissioner Of Income Tax (Appeals) 4, Chennai Dated 26.02.2016 Relevant To The Assessment Year 2011-12. 2. The Appeal Filed By The Assessee Is Time Barred By 2692 Days Delay In Filing The Appeal Before The Tribunal. The Assessee Has Filed Condonation Petition In Support Of An Affidavit, Wherein, Following Submissions Were Made:

For Appellant: Shri T. Vasudevan, AdvocateFor Respondent: Shri D. Hema Bhupal, JCIT

Section 143(3)Section 69

dated 31.03.2014 wherein the taxable income was determined at Rs.6,01,55,710/- after making addition of Rs.5,93,00,000/- towards unexplained investments u/s 69 A of the Act. 3. Aggrieved against the order passed by the Assessing Officer, appellant submitted an appeal before the Commissioner of Income

Shri Rohit Sethi, Indore vs. The DCIT 2(1), Indore

In the result, the appeal is allowed

ITA 118/IND/2023[2008-09]Status: DisposedITAT Indore10 Jan 2024AY 2008-09

Bench: Shri Vijay Pal Rao & Shri Manish Boradassessment Year:2008-09 Shri Rohit Sethi, Dcit, 62, Shiv Vilas Palace, 2(1), बनाम/ Rajwada, Indore. Vs. Indore. (Assessee / Appellant) (Revenue / Respondent) Pan: Appps9427R Assessee By Shri S.S.Solanki, Ca Revenue By Shri Ashish Porwal, Sr. Dr Date Of Hearing 02.01.2024 Date Of Pronouncement 10.01.2024

Section 143(3)Section 148

framed assessing the income at Rs. 35,07,800/-. In the said reassessment proceedings, addition of Rs. 30 lakhs was made towards unexplained investment allegedly made by the assessee by way of giving cash to Mr. Nilesh Ajmera for the purpose of purchasing immovable property. The said addition was made ... Counsel for the assessee. The issue for our consideration is that Whether the Ld. CIT(A) erred in confirming the addition for unexplained investment in the form of cash of Rs. 30 lakhs allegedly given by assessee to Nilesh Ajmera. We observe that search and seizure operation was carried

M/S. Ganesh Jewellers, Davangere vs. Deputy Commissioner of Income Tax, Central Circle-1(2), Bangalore

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

ITA 971/BANG/2023[2019-2020]Status: DisposedITAT Bangalore10 Jan 2024AY 2019-2020

Bench: Shri George George K & Shri Chandra Poojari, Acountant Member Assessment Year : 2019-20 M/S. Ganesh Jewellers, Vs. Dcit, #32, Nrupathunga Road, Chanagiri, Central Circle – 1(2), Davangere – 572 131. Bengaluru. Pan : Aaefg 5018 Q Appellant Respondent Assessee By : Shri. Siddesh N. Gaddi, Ca Revenue By : Shri. Ganesh R. Ghale, Standing Counsel. Date Of Hearing : 08.01.2024 Date Of Pronouncement : 10.01.2024

For Appellant: Shri. Siddesh N. Gaddi, CAFor Respondent: Shri. Ganesh R. Ghale, Standing Counsel

Section 139(4)Section 142Section 142(1)Section 144Section 153ASection 250Section 69Section 69A

order dated 11.08.2021. In the said Assessment Order, the AO made an addition of Rs.12,67,000/- under section 69 of the Act as unexplained investment and a sum of Rs.14,50,000/- under section 69A as unexplained cash. 3. Aggrieved, assessee filed appeal before the First Appellate Authority

Shri Balkrishna Gajanan Thopte, Thane vs. DCIT Cir 2, Kalyan

ITA 3380/MUM/2019[2014-15]Status: DisposedITAT Mumbai10 Jan 2024AY 2014-15

Bench: Shri Aby T Varkey, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

Section 132Section 142(1)Section 143(2)Section 147Section 148

assessee under section 68 iii) Balbir Chand Maini Vs CIT [2011]12 taxmann.com 276 (P&H) Section 69 of the Income-tax Act, 1961-Unexplained investments- Assessment year 1998-99-During assessment proceedings, Assessing Officer found that assessee had purchased certain shares of a company at rate between

Kulvinder Nath Marwah, New Delhi vs. ACIT, Circle-29(1), New Delhi

In the result, the appeal of the assessee is allowed

ITA 945/DEL/2019[2014-15]Status: DisposedITAT Delhi10 Jan 2024AY 2014-15

Bench: SHRI M. BALAGANESH (Accountant Member), SHRI ANUBHAV SHARMA (Judicial Member)

Section 12Section 143(3)Section 43(5)Section 69

assessment proceedings. The ld. AO proceeded to treated the peak balance i.e maximum investment on one date with each party to be an unexplained investment made in derivatives u/s 69 of the Act and added a sum of Rs 1,27,20,985/- in the assessment. 5. The assessee submitted ... transaction resulting in loss of Rs 2,50,000/- against sale of Rs 4,87,400/-. The total sale effected has been treated as unexplained investment by the ld. AO. b) Shri Krishna Shutterings Pvt Ltd through Ashlar Securities Private Limited – it is stated that in this concern the total

Sh. Sandeep Kumar, Ludhiana vs. ITO, Ward-4, Khanna

In the result, the appeal of the assessee is allowed

ITA 313/CHANDI/2023[2010-11]Status: DisposedITAT Chandigarh09 Jan 2024AY 2010-11

Bench: SHRI. AAKASH DEEP JAIN (Vice President), SHRI. VIKRAM SINGH YADAV (Accountant Member)

For Appellant: Shri Kuldeep Singh, ITP and Shri M.P. S. Malhotra, ITPFor Respondent: Shri Dharam Vir, JCIT, Sr. DR

Section 144Section 147Section 148Section 206CSection 68

explained. He accordingly initiated proceedings under section 147 of the Act. And thereafter made an addition of Rs 839,191/- as unexplained investment under section 68 of the Act, without confronting the assessee with any information in her possession which shows that the assessee had made payment ... books in the account of the assessee. Thus initiating proceedings under section 147 is bad in law and subsequent addition of this amount as unexplained investment, without confronting the assessee with any specific evidence that he had actually made any payment, the source of which remained unexplained is also

Dy. Commissioner of Income Tax, Central Circle-2(3), Hyderabad vs. Varsha Viswanath Properties Private Limited, Hyderabad

In the result, all the appeals filed by the assessee as well as the Revenue are treated as allowed for statistical purposes

ITA 2050/HYD/2018[2016-17]Status: DisposedITAT Hyderabad09 Jan 2024AY 2016-17

Bench: Shri Rama Kanta Panda & Shri K. Narasimha Chary

For Appellant: Shri S. Rama Rao, ARFor Respondent: Ms. TH. Vijaya Lakshmi, CIT-DR

Section 132Section 133ASection 153A

Rs.8,93,23,000/- made by the learned Assessing Officer on account of investment in the land for Venkatadri Hotels (P) Ltd as unexplained investment under section 69A of the Act. 44. Facts of the case, in brief, are that during the course of search at the office premises ... also the difference of Rs.8,93,23,000/- should not be Page 37 of 46 M/s. Varsha Viswanath Properties Private Limited batch treated as ‘unexplained investment’ in the said property. The assessee vide letter dated 04/07/2016 stated that it was only a proposal sent by the lawyer as a draft

Dy. Commissioner of Income Tax, Central Circle-2(3), Hyderabad vs. Varsha Viswanath Properties Private Limited, Hyderabad

In the result, all the appeals filed by the assessee as well as the Revenue are treated as allowed for statistical purposes

ITA 2049/HYD/2018[2015-16]Status: DisposedITAT Hyderabad09 Jan 2024AY 2015-16

Bench: Shri Rama Kanta Panda & Shri K. Narasimha Chary

For Appellant: Shri S. Rama Rao, ARFor Respondent: Ms. TH. Vijaya Lakshmi, CIT-DR

Section 132Section 133ASection 153A

Dy. Commissioner of Income Tax, Central Circle-2(3), Hyderabad vs. Varsha Viswanath Properties Private Limited, Hyderabad

In the result, all the appeals filed by the assessee as well as the Revenue are treated as allowed for statistical purposes

ITA 2048/HYD/2018[2014-15]Status: DisposedITAT Hyderabad09 Jan 2024AY 2014-15

Bench: Shri Rama Kanta Panda & Shri K. Narasimha Chary

For Appellant: Shri S. Rama Rao, ARFor Respondent: Ms. TH. Vijaya Lakshmi, CIT-DR

Section 132Section 133ASection 153A

Dy. Commissioner of Income Tax, Central Circle-2(3), Hyderabad vs. Varsha Viswanath Properties Private Limited, Hyderabad

In the result, all the appeals filed by the assessee as well as the Revenue are treated as allowed for statistical purposes

ITA 2047/HYD/2018[2013-14]Status: DisposedITAT Hyderabad09 Jan 2024AY 2013-14

Bench: Shri Rama Kanta Panda & Shri K. Narasimha Chary

For Appellant: Shri S. Rama Rao, ARFor Respondent: Ms. TH. Vijaya Lakshmi, CIT-DR

Section 132Section 133ASection 153A

Dy. Commissioner of Income Tax, Central Circle-2(3), Hyderabad vs. Varsha Viswanath Properties Private Limited, Hyderabad

In the result, all the appeals filed by the assessee as well as the Revenue are treated as allowed for statistical purposes

ITA 2046/HYD/2018[2012-13]Status: DisposedITAT Hyderabad09 Jan 2024AY 2012-13

Bench: Shri Rama Kanta Panda & Shri K. Narasimha Chary

For Appellant: Shri S. Rama Rao, ARFor Respondent: Ms. TH. Vijaya Lakshmi, CIT-DR

Section 132Section 133ASection 153A

Varsha Viswanath Properties Private Limited, Hyderabad vs. Asst. Commissioner of Income Tax, Central Circle-2(3), Hyderabad

In the result, all the appeals filed by the assessee as well as the Revenue are treated as allowed for statistical purposes

ITA 1910/HYD/2018[2016-17]Status: DisposedITAT Hyderabad09 Jan 2024AY 2016-17

Bench: Shri Rama Kanta Panda & Shri K. Narasimha Chary

For Appellant: Shri S. Rama Rao, ARFor Respondent: Ms. TH. Vijaya Lakshmi, CIT-DR

Section 132Section 133ASection 153A

Varsha Viswanath Properties Private Limited, Hyderabad vs. Asst. Commissioner of Income Tax, Central Circle-2(3), Hyderabad

In the result, all the appeals filed by the assessee as well as the Revenue are treated as allowed for statistical purposes

ITA 1909/HYD/2018[2015-16]Status: DisposedITAT Hyderabad09 Jan 2024AY 2015-16

Bench: Shri Rama Kanta Panda & Shri K. Narasimha Chary

For Appellant: Shri S. Rama Rao, ARFor Respondent: Ms. TH. Vijaya Lakshmi, CIT-DR

Section 132Section 133ASection 153A

Varsha Viswanath Properties Private Limited, Hyderabad vs. Asst. Commissioner of Income Tax, Central Circle-2(3), Hyderabad

In the result, all the appeals filed by the assessee as well as the Revenue are treated as allowed for statistical purposes

ITA 1908/HYD/2018[2014-15]Status: DisposedITAT Hyderabad09 Jan 2024AY 2014-15

Bench: Shri Rama Kanta Panda & Shri K. Narasimha Chary

For Appellant: Shri S. Rama Rao, ARFor Respondent: Ms. TH. Vijaya Lakshmi, CIT-DR

Section 132Section 133ASection 153A

Varsha Viswanath Properties Private Limited, Hyderabad vs. Asst. Commissioner of Income Tax, Central Circle-2(3), Hyderabad

In the result, all the appeals filed by the assessee as well as the Revenue are treated as allowed for statistical purposes

ITA 1907/HYD/2018[2013-14]Status: DisposedITAT Hyderabad09 Jan 2024AY 2013-14

Bench: Shri Rama Kanta Panda & Shri K. Narasimha Chary

For Appellant: Shri S. Rama Rao, ARFor Respondent: Ms. TH. Vijaya Lakshmi, CIT-DR

Section 132Section 133ASection 153A