“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

Chetan Bipinbhai Bha vs. Ar, Suratvs.Income Tax Officer Ward-2, Bardoli

In the result, appeal filed by the assessee is allowed

ITA 620/SRT/2023[2017-18]Status: HeardITAT Surat27 Oct 2023AY 2017-18

Bench: Shri Dr. A. L. Sainiआयकर अपील सं./Ita No.620/Srt/2023 Assessment Year: (2017-18) (Physical Hearing) Chetan Bipinbhai Bhavsar Income Tax Officer, 304, Monalisha Complex, Vs. Ward-2, Bardoli, Income Tax Shastri Road, Bardoli– Office Aaykar Bhavan, Station 394601 Road, Bardoli-394601 "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Anjpb 0949 B (अपीलाथ"/Appellant) (""थ" /Respondent)

Section 131Section 142(1)Section 143(2)Section 143(3)Section 68

proper course would have been to make assessments in the cases of those creditors by' treating the cash deposits in their bank accounts as unexplained investments of those creditors under section 69. 9. In the case of Nemi Chand Kothari 136 Taxman 213, the Hon'ble Guahati High Court

Ripal Arvidbhai Patel, Surat vs. Income Tax Officer, Surat

In the result, the grounds of appeal raised by the assessee are allowed

ITA 540/SRT/2023[A.Y.2016-17]Status: DisposedITAT Surat27 Oct 2023

Bench: Shri Pawan Singh(Hybrid Hearing) Ripal Arvindbhai Patel, I.T.O., 10/2, Patel Nagar Society, Opp. Ward-1(3)(8), Vs. Deepa Complex, Adajan Surat. Patia-395009. (Gujarat) Pan No. Anapp 0272 C Appellant/ Assessee Respondent/ Revenue

Section 115BSection 254(1)Section 69B

action of assessing officer in Ripal Arvindbhai Patel Vs ITO invoking provisions of Section 115BBE of the Act and in thereby taxing entire unexplained investment at flat rate of 30 percentages. 4. Appellant craves leave to add, alter or delete any ground(s) either before or in the course ... extent of Rs. 2.02 lacs as against the addition of Rs. 7,73,122/- made by the Assessing Officer on account of unexplained investment for purchase of machineries during the relevant financial year. The ld. AR of the assessee submits that the Assessing Officer made addition on the basis

Pratima Hitesh Mehta, Mumbai vs. DCIT, CC-4(1), Mumbai

In the result, the present cross-appeals are partly allowed for statistical purposes

ITA 416/MUM/2023[1992-93]Status: DisposedITAT Mumbai26 Oct 2023AY 1992-93

Bench: Shri G.S. Pannu & Shri Sandeep Singh Karhail

For Appellant: Shri Dharmesh Shah a/wFor Respondent: Dr. P. Daniel

Section 133(6)Section 142(1)Section 144Section 145(2)Section 250Section 254

under section 133(6) of the Act, dividend details, and investment in shares, inter-alia, made an addition of Rs.10,87,14,014, as unexplained investment in shares. 4. The learned CIT(A), vide impugned order, granted partial relief to the assessee and deleted the addition to an extent ... submissions of the assessee and the information available on record. The learned CIT(A) upheld the addition of Rs.1,47,77,303, as an unexplained investment in shares. The learned CIT(A) also directed the AO to restrict the deduction of interest expenditure to Rs.15,73,548, in respect

Dy Commissioner of Income Tax, Cent -Circle-4(1), Mumbai vs. Smt Pratima H. Mehta, Mumbai

In the result, the present cross-appeals are partly allowed for statistical purposes

ITA 1180/MUM/2023[1992-93]Status: DisposedITAT Mumbai26 Oct 2023AY 1992-93

Bench: Shri G.S. Pannu & Shri Sandeep Singh Karhail

For Appellant: Shri Dharmesh Shah a/wFor Respondent: Dr. P. Daniel

Section 133(6)Section 142(1)Section 144Section 145(2)Section 250Section 254

Shri Subhash Arora, Raisen vs. The ITO 2(5), Bhopal

ITA 179/IND/2022[2012-13]Status: DisposedITAT Indore26 Oct 2023AY 2012-13

Bench: Shri Vijay Pal Rao & Shri B.M. Biyaniassessment Year : 2012-13 Shri Subhash Arora, Ito, Hig 9/B, Ishan Park, 5(2), Patel Nagar, Bhopal बनाम/ Raisen Road, Bhopal Vs.

Section 143(2)Section 143(3)Section 148Section 54FSection 69A

proceedings instituted is bad and unjust. 3. The Ld. CIT(A) has erred in upholding the addition of Rs. 14,25,000/- as unexplained investment, when the said amount was available with the assessee. On the contrary the amount was utilized for purchase of house which is duly reflected

Sumit Goel, Jaipur vs. Income Tax Officer, Jaipur

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

ITA 8/JPR/2023[2012-13]Status: DisposedITAT Jaipur26 Oct 2023AY 2012-13

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri S.L. Poddar(Adv.)&For Respondent: Smt. Monisha Choudhary(Addl.CIT)

Section 10(38)Section 147Section 148Section 56Section 68Section 69C

Jodhpur: - (i) INCOME TAX OFFICER vs. SMT. KUSUMLATA( ITAT, JODHPUR BENCH) (2006) 105 TTJ 0265 Income from undisclosed sources—Addition under s. 69—Unexplained investment in house property—Assessee is said to have made investment in the construction of residential house out of sale proceeds of shares of a company

Saloni Jewellers Pvt Ltd, Mumbai vs. National E-Assessment Centre-Delhi, Mumbai

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

ITA 1003/MUM/2023[2018-2019]Status: DisposedITAT Mumbai25 Oct 2023AY 2018-2019

Bench: Shri Aby T. Varkey, Jm & Shri Amarjit Singh, Am आयकर अपील सं/ I.T.A. No.1003/Mum/2023 (निर्धारण वर्ा / Assessment Year: 2018-19) Saloni Jewellers Pvt. Ltd. बिधम/ National E-Assessment 4Th Floor, 80-80B Patwa Centre-Delhi. Vs. Chawl, Zaveri Bazar, Mumbai-400002. स्थधयी लेखध सं./जीआइआर सं./Pan/Gir No. : Aagcs5432B (अपीलार्थी /Appellant) .. (प्रत्यर्थी / Respondent) Assessee By: Ms. Rutuja Pawar/Ms Sneha More Revenue By: Dr. Kishore Dhule (Dr) सुनवाई की तारीख / Date Of Hearing: 23/08/2023 घोषणा की तारीख /Date Of Pronouncement: 25/10/2023 आदेश / O R D E R Per Aby T. Varkey, Jm: This Is An Appeal Preferred By The Assessee Company Against The Order Of The Ld. Commissioner Of Income Tax (Appeals)/(Nfac), Delhi Dated 07.02.2023 For The Assessment Year 2018-19. 2. At The Outset, The Ld. Ar Of The Assessee Pointed Out That The Ld. Cit(A)/Nfac Has Passed Impugned Order Ex-Parte Qua Assessee. It Is Noted That The Assessee Is A Private Limited Company Engaged In The Business Of Trading & Manufacturing Jewelry Like Silver & Gold Items. The Appellant Filed Original Return Of Income U/S. 139(1) On 26.10.2018 Declaring Total Income As “Nil” For A.Y. 2018-19. The Assessee/Appellant Has Taken Loans From State Bank Of India Whereby The Account Amounting To Rs.129,87,70,130/- (Approximately) Was Classified As Declared As Non-Performing Asset (Npa Category) On 28.07.2015. Therefore, According To Ld. Ar, The Appellant Is A Npa

For Appellant: Ms. Rutuja Pawar/Ms Sneha MoreFor Respondent: Dr. Kishore Dhule (DR)

Section 139(1)Section 143(3)Section 69

Income Tax Act, 1961 (hereinafter “the Act”) on 13.04.2021 by making two additions u/s 69 r.w.s. 115BBE of the Act as unexplained investment the closing stock of Rs.88,13,12,760/- which assessee contest; and according to assessee it is Rs.79,29,09,789/- and short-term borrowings of Rs.178 ... unexplained investment. Aggrieved by the assessment order, the appellant preferred an appeal before NFAC, for A.Y. 2018-19. According to Ld AR, the appellant being a loss-making company and even having its all accounts NPA does not have any staff working in their company as they

Vinay Parmanand Hariani, Mumbai vs. ITO (It), Ward-2(2)(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 985/MUM/2023[2015-16]Status: DisposedITAT Mumbai19 Oct 2023AY 2015-16

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal () Assessment Year: 2015-16 Vinay Parmanand Hariani, Ito, Int. Taxation Ward 2(2)(1), Kempinski Private Residences Room No. 1725, 17Th Floor, Air Vs. Unit 40F Dki Jakarta, 10310 India Building, Nariman Point, Indonesia. Mumbai-400021. Pan No. Aabph 4179 A Appellant Respondent

For Appellant: Mr. Piyush ChaturvediFor Respondent: Mr. Anil Sant, Sr. DR

Section 115GSection 69A

Rs.2,35,023/ term capital gain of Rs.2,35,023/-, (3) Long term capital gai term capital gain of Rs.7,54,209/-, (4) Unexplained investment in mutual fund namely investment in mutual fund namely investment in mutual fund namely Franklin Tempton of Rs.14,00,000/ Tempton of Rs.14 ... final order added Rs. 30,00,000 The Ld. AO on page no. 9 of the final order added Rs. 30,00,000 as unexplained investment in Franklin Templeton MF. Kindly note as unexplained investment in Franklin Templeton MF. Kindly note as unexplained investment in Franklin Templeton MF. Kindly note

Ashwinkumar Liladhar Vaidya, Mumbai vs. ITO (Int), Ward-4(3)(1), Mumbai

In the result, all the three appeals of the assessee are allowed

ITA 1131/MUM/2023[2016-17]Status: DisposedITAT Mumbai19 Oct 2023AY 2016-17

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal () Ita Nos. 1131, 1129, 1130/Mum/2023 Assessment Years: 2016-17 To 2018-19 Ashwinkumar Liladhar Vaidya, Ito, Int. Tax Ward 4(3)(1), 68, Manor Road, Oldham Ol4 Mumbai. Vs. 5Nb Lancashire, United Kingdom. Pan No. Aghpv 7878 C Appellant Respondent Assessee By : Mr. Ashish A. Thakurdesai Revenue By : Mr. Anil Sant, Sr. Dr Date Of Hearing : 12/10/2023 : Date Of Pronouncement 19/10/2023

For Appellant: Mr. Ashish A. ThakurdesaiFor Respondent: Mr. Anil Sant, Sr. DR

Section 153CSection 234A

hence no addition M/s Shriram Enterprises is duly explained and hence no addition M/s Shriram Enterprises is duly explained and hence no addition for unexplained investment is required to made in the hands of the for unexplained investment is required to made in the hands of the for unexplained investment ... assessee and therefore, with the assessee and therefore, the Ld. DRP justified in partly the Ld. DRP justified in partly upholding addition in unexplained investment. upholding addition in unexplained investment. Ashwinkumar Liladhar Vaidya 6 Ashwinkumar Liladhar Vaidya ITA Nos. 1129 to 1131/Mum/2023 ITA Nos. 1129 to 1131/Mum/2023 5. We have

Ashwinkumar Liladhar Vaidya, Mumbai vs. ITO (Int), Ward-4(3)(1), Mumbai

In the result, all the three appeals of the assessee are allowed

ITA 1130/MUM/2023[2018-19]Status: DisposedITAT Mumbai19 Oct 2023AY 2018-19

For Appellant: Mr. Ashish A. ThakurdesaiFor Respondent: Mr. Anil Sant, Sr. DR

Section 153CSection 234A

Ashwinkumar Liladhar Vaidya, Mumbai vs. ITO (Int), Ward-4(3)(1), Mumbai

In the result, all the three appeals of the assessee are allowed

ITA 1129/MUM/2023[2017-18]Status: DisposedITAT Mumbai19 Oct 2023AY 2017-18

For Appellant: Mr. Ashish A. ThakurdesaiFor Respondent: Mr. Anil Sant, Sr. DR

Section 153CSection 234A

Aparajita Homes Pvt Ltd, New Delhi vs. ACIT, Central Circle-2, New Delhi

In the result, both the appeals of assessee are allowed

ITA 1991/DEL/2022[2016-17]Status: DisposedITAT Delhi19 Oct 2023AY 2016-17

Bench: Shri G.S. Pannu, Hon’Ble & Shri Chandra Mohan Gargi.T.A Nos.1990 & 1991/Del/2022 Assessment Years: 2015-16 & 2016-17 Aparajita Homes Pvt. Ltd., Vs. Acit A-410, Ansal Chamber-1, Central Circle-2, R.K. Puram, South West Delhi, Jhandewalan Extn., New Delhi. New Delhi. Pan No. Aahca 4557 C Appellant Respondent Assessee By Shri Salil Aggarwal, Sr. Adv. & Shri Shailesh Gupta, Ca Revenue By Shri Zafarul Haque Tanweer, Cit Dr Date Of Hearing: 04.10.2023 Pronouncement On 19.10.2023 O R D E R Per C.M. Garg, J.M.

impugned amount as income in the P&L account then the further addition is not required to be made by alleging the same as unexplained investment u/s. 69 of the Act. Accordingly, grievance of assessee is allowed and Assessing Officer is directed to delete the addition. 7. Since facts

Aparajita Homes Pvt Ltd, New Delhi vs. ACIT, Central Circle -2, New Delhi

In the result, both the appeals of assessee are allowed

ITA 1990/DEL/2022[2015-16]Status: DisposedITAT Delhi19 Oct 2023AY 2015-16

Jumman Lal Yadav, Durg vs. ACIT-1(1), Bhilai

In the result, the appeal of the assessee being devoid and bereft of any merit is dismissed in terms of the aforesaid observations

ITA 290/RPR/2023[2011-12]Status: DisposedITAT Raipur19 Oct 2023AY 2011-12

Bench: Shri Ravish Soodआयकर अपील सं. / Ita No. 290/Rpr/2023 "नधा"रण वष" / Assessment Year : 2011-12 Jumman Lal Yadav Deep Chowk, Kusumkasa, Balod, Durg (C.G.)-491 228 Pan : Acmpy0168R .......अपीलाथ" / Appellant बनाम / V/S. The Assistant Commissioner Of Income Tax-1(1), Bhilai (C.G.)

For Appellant: NoneFor Respondent: Shri Satya Prakash Sharma, Sr. DR

Section 119aSection 142(1)Section 144Section 147Section 148

framed u/s 144, wherein the afore mentioned cash deposit in the account along with the interest earned on the bank account was added as unexplained investment of the assessee. 5.2 The fact that clearly emerges that the AO did not have any material other than the bank account statement ... find no reason to intervene with the well-reasoned view taken by the lower authorities who had rightly held the same as his unexplained investment u/s. 69 of the Act. Thus, the Ground of appeal No.4 raised by the assessee is dismissed in terms of the aforesaid observations. 13. Ground

Smt. Krishna, Alwar vs. ITO, Ward-Bhiwadi, Alwar

In the result, both appeal of the assessee in ITA No

ITA 435/JPR/2023[2010-11]Status: DisposedITAT Jaipur19 Oct 2023AY 2010-11

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri P. C. Parwal (FCA.)For Respondent: Smt Monisha Choudhary (Addl. CIT) a

Section 151(1)Section 271(1)(c)Section 69

erred on facts and in law in confirming the addition of Rs. 10,10,800/- u/s 69 of the Act on account of unexplained investment in purchase of land without considering the fact that the land was purchased by the husband of assessee in her name and thus when assessee ... Hence, an addition of Rs. 10,10,800/- was made to the total income of assessee on account of unexplained investment made by assessee. 5. Aggrieved by the order of the assessment the assessee preferred an appeal before the Commissioner of Income Tax. A propose to the grounds so raised

Smt. Krishna, Alwar vs. ITO, Ward-Bhiwadi, Alwar

In the result, both appeal of the assessee in ITA No

ITA 434/JPR/2023[2010-11]Status: DisposedITAT Jaipur19 Oct 2023AY 2010-11

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri P. C. Parwal (FCA.)For Respondent: Smt Monisha Choudhary (Addl. CIT) a

Section 151(1)Section 271(1)(c)Section 69

Geeta Mandar Joshi, Mumbai vs. ITO Ward 35(1)(4), Mumbai

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

ITA 2702/MUM/2023[2015-2016]Status: DisposedITAT Mumbai18 Oct 2023AY 2015-2016

Bench: Shri Pavan Kumar Gadalegeeta Mandar Joshi, Vs. Ito, Ward -35(1)(4) 122B, Purshottam Kautilya Bhawan, Towers Chsl, Gokhale G-Block, Bkc, Road (South), Mumbai-400051. Prabhadevi, Dadar, Mumbai-400028. Pan/Gir No. : Ahqpj8798M Appellant .. Respondent

For Appellant: Shri. Anil Sethe.ARFor Respondent: Shri. G.J. Ninawe, Sr. DR

Section 143(1)Section 143(3)Section 69

from explaining her case on merits. 2 The learned CIT(A) erred in upholding addition u/s 69 amounting to Rs. 14,21,126/- as unexplained investments. Geeta Mandar Joshi, Mumbai. 3. The learned CIT(A) erred in upholding the addition u/s 69 even though the appellant had offered explanation ... Rs.2,64,34,854/- and the explanations of the assessee for the difference amount of Rs.14,21,126/- were not satisfactory and treated as unexplained investment u/s 69 of the Act and assessed the total income of Rs. 19,09,770/- and passed the order u/sec

Sanjeev Kumar, Bulandshahr vs. ITO, Ward 2(3)(2), Bulandshahr

In the result, appeal of the assessee is allowed

ITA 658/DEL/2023[2017-18]Status: DisposedITAT Delhi18 Oct 2023AY 2017-18

Bench: The Tribunal.

Section 69

joint home loan account. The Ld.AR I.T.A.No.658/Del/2023 also submitted that the AO has made addition u/s 69 of the Act which pertains to unexplained investment whereas in the present case the assessee has not made any unexplained investment but he made repayment of loan. Therefore, the view of judgment ... legal position that the Assessing Officer has adopted incorrect charging section of 69 of the Act which pertains to the issue of unexplained investment by the assessee, whereas the assessee has not made any investment by way of depositing cash to his joint home loan bank account with his wife

Shailbala Chowdary L/H Late Shri Kailashchandra Chowaday, Yavatmal vs. ACIT, Central Circle-1(2), Nagpur

In the result, the appeal filed by the assessee stands dismissed in the terms indicated above

ITA 205/NAG/2017[2005-06]Status: DisposedITAT Nagpur18 Oct 2023AY 2005-06

Bench: SHRI INTURI RAMA RAO (Accountant Member), SHRI S. S. VISWANETHRA RAVI (Judicial Member)

For Appellant: NoneFor Respondent: Shri Vijay Kumar Subramanyam

Section 153C

Nagpur (‘the Assessing Officer’) vide order dated 30.12.2008 at a total income of Rs.57,99,560/- after making addition on account of unexplained investments and difference in the balance of books of account etc. 3. Being aggrieved, an appeal was filed before the ld. CIT(A), who vide impugned order

Shiv Singh, Bhilai, Durg vs. Income Tax Officer-1(2), Bhilai, Durg

In the result, the appeal of the assessee is allowed for statistical purposes in terms of the aforesaid observations

ITA 259/RPR/2023[2015-16]Status: DisposedITAT Raipur18 Oct 2023AY 2015-16

Bench: Shri Ravish Soodआयकर अपील सं. / Ita No. 259/Rpr/2023 "नधा"रण वष" / Assessment Year : 2015-16 Shiv Singh, Quarter No.4/B, Street No.12 Sector-8, Bhilai, Durg-490 009 Pan : Bdtps1578Q .......अपीलाथ" / Appellant बनाम / V/S. The Income Tax Officer-1(2), Bhilai (C.G.) ……""यथ" / Respondent

For Appellant: Shri S.R. Rao, AdvocateFor Respondent: Shri Satya Prakash Sharma, Sr. DR

Section 143(2)Section 143(3)Section 44ASection 69

case and in law, the Ld. Commissioner of Income-tax (Appeals) is not justified in confirming the addition of Rs.14,53,494/- as unexplained investments u/s. 69 of the Income-tax Act, 1961. 3) In the facts and circumstances of the case and in law, the Ld. Commissioner of Income ... assessee at Rs.38,26,294/- after, inter alia, making the following additions/disallowances: Sr. No. Particulars Amount 1. Addition on account of Rs.14,53,494/- unexplained investment u/s.69 of the Act 2. Addition on account of Rs.14,99,300/- unexplained cash gifts received from parents u/s.69 of the Act 3. Addition