“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

Vijit Singh, Jaipur vs. ITO Ward 3(2) Jaipur, Jaipur

In the result, the appeal of the assessee is allowed

ITA 1246/JPR/2025[2009-10]Status: DisposedITAT Jaipur17 Nov 2025AY 2009-10

For Appellant: Shri Shrawan Kumar Gupta, AdvFor Respondent: Shri Gaurav Awasthi, JCIT

Section 147Section 234ASection 250

basis of information available in ITS Data of the assessee made the addition of Rs.60,00,000/- on account of unexplained investments in Birla Sun Life Mutual Funds of Rs.30,00,000/- and HDFC Mutual Funds of Rs.30,00,000/- treating the same as undisclosed income

Deputy Commissioner of Income Tax, Central Circle-1, Ludhiana vs. Jagjit Singh Grewal, Ludhiana

In the result, appeal of the assessee is allowed and that

ITA 357/CHANDI/2025[2022-23]Status: DisposedITAT Chandigarh17 Nov 2025AY 2022-23

Bench: Shri Rajpal Yadav & Shri Manoj Kumar Aggarwalआयकर अपील सं./ Ita No. 1242/Chd/2024 निर्धारण वर्ष / Assessment Year: 2022-23 Shri Jagjit Singh Grewal, Barewal, Awana, Ferozepur Road, Ludhiana. Vs The Dcit, Central Circle-1, Ludhiana. स्थायी लेखा सं./Pan No: Ahjpg1260E अपीलार्थी/Appellant प्रत्यर्थी/Respondent आयकर अपील सं./ Ita No. 357/Chd/2025 The Dcit, Central Circle-1, Ludhiana. निर्धारण वर्ष / Assessment Year: 2022-23 Shri Jagjit Singh Grewal, Barewal, Awana, Ferozepur Road, Ludhiana. V S स्थायी लेखा सं./Pan No: Ahjpg1260E अपीलार्थी/Appellant प्रत्यर्थी/Respondent Assessee By: Shri Sudhir Sehgal, Advocate Revenue By: Shri Manav Bansal, Cit Dr Date Of Hearing : 21.08.2025 Date Of Pronouncement : 17.11.2025 Per Rajpal Yadav, Vp Order The Assessee & Revenue Are In Cross-Appeals Against The Order Of The Ld. Commissioner Of Income Tax (Appeals) [In Short ‘The Cit (A)'] Dated 14.12.2024 Passed For

For Appellant: Shri Sudhir Sehgal, AdvocateFor Respondent: Shri Manav Bansal, CIT DR

both the appeals together. 2. The grievance of the assessee is that ld.CIT (Appeals) has erred in partially retaining the addition on account of unexplained investment in jewellery whereas in ground No. 1 and 2, the Revenue has also pleaded that ld.CIT (Appeals) has erred in partially deleting the addition ... question was purchased during the period of search out of unexplained resources. Accordingly, we allow the appeal of the assessee and delete the alleged unexplained investment of Rs.46,96,225/-. Consequently, ground Nos.1 and 2 of the Revenue's appeal are rejected. 7. The next ground in the Revenue

Jagjit Singh Grewal, Barewal Awana, Ferozepur Road, Ludhiana vs. Deputy Commissioner of Income Tax, CC1, Ludhiana

In the result, appeal of the assessee is allowed and that of the Revenue is dismissed

ITA 1242/CHANDI/2024[2022-2023]Status: DisposedITAT Chandigarh17 Nov 2025AY 2022-2023

Bench: Shri Rajpal Yadav & Shri Manoj Kumar Aggarwalआयकर अपील सं./ Ita No. 1242/Chd/2024 "नधा"रण वष" / Assessment Year: 2022-23 Shri Jagjit Singh Grewal, The Dcit, Barewal, Awana, Vs Central Circle-1, Ferozepur Road, Ludhiana. Ludhiana. "थायी लेखा सं./Pan No: Ahjpg1260E अपीलाथ"/Appellant ""यथ"/Respondent आयकर अपील सं./ Ita No. 357/Chd/2025 "नधा"रण वष" / Assessment Year: 2022-23 The Dcit, Shri Jagjit Singh Grewal, Central Circle-1, V Barewal, Awana, Ludhiana. S Ferozepur Road, Ludhiana. "थायी लेखा सं./Pan No: Ahjpg1260E अपीलाथ"/Appellant ""यथ"/Respondent

For Appellant: Shri Sudhir Sehgal, AdvocateFor Respondent: Shri Manav Bansal, CIT DR

both the appeals together. 2. The grievance of the assessee is that ld.CIT (Appeals) has erred in partially retaining the addition on account of unexplained investment in jewellery whereas in ground No. 1 and 2, the Revenue has also pleaded that ld.CIT (Appeals) has erred in partially deleting the addition ... question was purchased during the period of search out of unexplained resources. Accordingly, we allow the appeal of the assessee and delete the alleged unexplained investment of Rs.46,96,225/-. Consequently, ground Nos. 1 and 2 of the Revenue’s appeal are rejected. 7. The next ground in the Revenue

Vinaya Prasanna Kulkarni, Mumbai vs. Income Tax Officer Ward 3(4), 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 5726/MUM/2025[2019-20]Status: DisposedITAT Mumbai17 Nov 2025AY 2019-20

Bench: Shri Sandeep Gosain () & Shri Om Prakash Kant () Assessment Year: 2019-2020

For Respondent: Mr. Haridas Bhatt

Section 115BSection 69A

Rs.1,00,00,000/- u/s 69A and taxed U/s 115BBE of the Act, as u/s 69A and taxed U/s 115BBE of the Act, as unexplained investments in Fixed Deposits. unexplained investments in Fixed Deposits. B. On the facts and circumstances of the case

Income Tax Officer, Lower Parel vs. Bhavani Balasubramaniam Iyer, Mumbai

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

ITA 2933/MUM/2025[2016]Status: DisposedITAT Mumbai17 Nov 2025

Bench: Shri Vikram Singh Yadav & Shri Sandeep Singh Karhail

For Appellant: Shri Yagnesh DesaiFor Respondent: Shri Leyaqat Ali Aafaqui

Section 147Section 148Section 271(1)(c)Section 44ASection 69

agreement as 31-03-2015 and it was submitted that inspite of that, the AO has proceeded and made the addition towards the unexplained investment. It was further submitted that the assessee has purchased the flat through borrowed funds from financial institution and the Ld.CIT(A) has rightly taken cognizance

Income Tax Officer, Pirmal Chamber, Lower Parel vs. Bhavani Balasubramaniam Iyer, Mumbai

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

ITA 2932/MUM/2025[2016]Status: DisposedITAT Mumbai17 Nov 2025

Bench: Shri Vikram Singh Yadav & Shri Sandeep Singh Karhail

For Appellant: Shri Yagnesh DesaiFor Respondent: Shri Leyaqat Ali Aafaqui

Section 147Section 148Section 271(1)(c)Section 44ASection 69

Bhavani Lyer, Mumbai vs. ITO 24(1)(1)A, Mumbai

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

ITA 2777/MUM/2025[2016-17]Status: DisposedITAT Mumbai17 Nov 2025AY 2016-17

Bench: Shri Vikram Singh Yadav & Shri Sandeep Singh Karhail

For Appellant: Shri Yagnesh DesaiFor Respondent: Shri Leyaqat Ali Aafaqui

Section 147Section 148Section 271(1)(c)Section 44ASection 69

Madhu Bala Gupta, Delhi vs. DCIT, Central Circle-31, New Delhi

In the result, the appeal of assessee is allowed as above

ITA 716/DEL/2025[2021-22]Status: DisposedITAT Delhi17 Nov 2025AY 2021-22

Bench: Shri Vikas Awasthy & Shri Avdhesh Kumar Mishra

Section 132Section 143(2)Section 143(3)Section 153CSection 69

scrutinized and consequential assessment was done at income of Rs.3,38,71,980/- after making the addition of Rs.2,90,05,500/- as unexplained investment based on WhatsApp chat of Sh. Vaibhav Jain with Sh. Gopal Mittal (husband of one of the sellers; Mrs. Reena Mittal). During the search

Chander Sekhar Pahariya, Bhander vs. Assessing Officer, Gwalior

In the result, appeal is allowed for statistical purposes

ITA 207/AGR/2025[2017-2018]Status: DisposedITAT Agra14 Nov 2025AY 2017-2018

Bench: : Shri M. Balaganesh & Shri Sunil Kumar Singhassessment Year: 2017-18

Section 143(1)Section 143(2)Section 143(3)Section 250Section 68Section 69Section 69A

Officer made addition of Rs.11,03,753/- u/s. 69A as unexplained money, Rs.3,28,272/- as income from other sources, Rs.9,00,000/- as unexplained investment u/s. 69 of the Act and Rs.30,52,957/- as unexplained cash credit u/s. 68 of the Act. 3. Aggrieved, assessee preferred an appeal ... income from other sources. Learned CIT(Appeals), after considering assessee’s submissions, deleted Rs.9,00,000/-, which was added by ld. Assessing Officer as unexplained investment u/s. 69 of the Act. 2 | P a g e 4. Appellant assessee has, thus, approached this Tribunal only against confirmation of remaining

Yasir Bilal Khan Prop. Ms Khan Impex Fruit Mandi, Parimpora Srinagar, Jammu and Kashmir vs. Deputy Commissioner of Income Tax Central Circle Jammu, Srinagar

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

ITA 332/ASR/2024[2017-2018]Status: DisposedITAT Amritsar14 Nov 2025AY 2017-2018

Bench: Sh. Manoj Kumar Aggarwal & Sh. Udayan Dasgupta

For Appellant: None

Section 131Section 144Section 250(6)Section 69

fruits @ 2% of gross sales as disclosed by the assessee in his VAT return and secondly an addition of Rs.15 lakhs on account of unexplained investment made for purchase of immovable property (land) on the basis of purchase documents found in course of search conducted by NIA (National Investigation Agency ... Rs.7.42 lakhs on A/c of business profits on trading of fruits plus an amount of Rs.15 lakhs being the addition on account of unexplained investment in purchase of land u/s 69 of the Act). 10. The matter caried in first appeal has been dismissed

Khandelwal Industries, Dhamtari vs. Income Tax Officer, Ward- Dhamtari, Dhamtari

In the result, appeal of the assessee is allowed

ITA 551/RPR/2025[2017-18]Status: DisposedITAT Raipur14 Nov 2025AY 2017-18

Bench: Shri Partha Sarathi Chaudhuryआयकर अपील सं./Ita No.551/Rpr/2025 "नधा"रण वष" /Assessment Year : 2017-18 Khandelwal Industries Industrial Area, Dhamtari Chhattisgarh-493 773 Pan: Aaqfk4740D .......अपीलाथ" / Appellant बनाम / V/S. The Income Tax Officer, Ward-Dhamtari (C.G.) ……""यथ" / Respondent

For Appellant: Shri Sunil Kumar Agrawal, CAFor Respondent: Dr. Priyanka Patel, Sr. DR

Section 250Section 68

facts of the case the A.O. had rightly followed the provisions u/s. 68 r.w.s. 115BBE of the Act and made the addition as Unexplained Investment. In view of the above Ground No. 2 (a) is hereby dismissed.” 4. That on a careful consideration, it is noted that neither

Reddy Sampat Vijaya, Hyderabad vs. ACIT., Central Circle - 1(1), Hyderabad

In the result, the appeal filed by the assessee for A

ITA 1498/HYD/2025[2019-20]Status: DisposedITAT Hyderabad14 Nov 2025AY 2019-20

Bench: SHRI G. MANJUNATHA, HON’BLE (Accountant Member), SHRI RAVISH SOOD, HON’BLE (Judicial Member)

Section 132Section 143(1)Section 143(2)Section 153ASection 250

land was purchased by the assessee for a consideration of Rs.2,25,000/-. The difference of Rs. 9,55,000/- has been treated as unexplained investment and added to the income returned. 4. Aggrieved by the assessment order, the assessee preferred an appeal before the Ld. CIT(A). 5. Before ... towards ad hoc disallowance of agricultural income and assessed the income under the head “Income from other sources” and also made addition towards unexplained investment being the difference between the consideration as per sale agreement and the registered sale deed. The Ld. CIT(A), after considering the submissions

Reddy Sampat Vijaya, Hyderabad vs. ACIT., Central Circle -1(1), Hyderabad

In the result, the appeal filed by the assessee for A

ITA 1497/HYD/2025[2017-18]Status: DisposedITAT Hyderabad14 Nov 2025AY 2017-18

Bench: SHRI G. MANJUNATHA, HON’BLE (Accountant Member), SHRI RAVISH SOOD, HON’BLE (Judicial Member)

Section 132Section 143(1)Section 143(2)Section 153ASection 250

Reddy Sampat Vijaya, Hyderabad vs. ACIT., Central Circle- 1(1), Hyderabad

In the result, the appeal filed by the assessee for A

ITA 1496/HYD/2025[2015-16]Status: DisposedITAT Hyderabad14 Nov 2025AY 2015-16

Bench: SHRI G. MANJUNATHA, HON’BLE (Accountant Member), SHRI RAVISH SOOD, HON’BLE (Judicial Member)

Section 132Section 143(1)Section 143(2)Section 153ASection 250

Narendra Kumar, Shamli vs. Income Tax Officer, Ward - 3(1)(4), Shamli

Appeal is allowed for statistical purposes in the aforesaid

ITA 5717/DEL/2025[2017-18]Status: DisposedITAT Delhi14 Nov 2025AY 2017-18

Bench: Shri Mahavir Singh, Hon’Bleasstt. Year : 2017-18

For Appellant: Sh. Rahul Agarwal, AdvFor Respondent: Shri Manoj Kumar, Sr. DR

Section 139Section 142(1)Section 144Section 69A

sustaining the addition of Rs. 11,87,000/- made by the AO u/s. 69A of the Act by treating the cash deposit as unexplained investment. 2. The brief facts of the case are that on the basis of data of analytics and information gathered during the phase of online verification

Abuchi Infra Ventures Limited, Delhi vs. Income Tax Officer, Ward-2(3), Delhi

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

ITA 2712/DEL/2023[2017-18]Status: DisposedITAT Delhi14 Nov 2025AY 2017-18

Bench: Shris.Rifaur Rahman & Shri Anubhav Sharmaabuchi Infra Ventures Limited, Vs. Ito, Ward 2 (3), Kh No.115, Village Alipur, Delhi. Delhi – 110 036. (Pan : Aacb5801K) (Appellant) (Respondent) Assessee By : Shri Harshit Srivastav, Ca Revenue By : Shri Ajay Kumar Arora, Sr. Dr Date Of Hearing : 29.10.2025 Date Of Order : 14.11.2025 O R D E R Per S. Rifaur Rahman: 1. The Assessee Has Filed Appeal Against The Order Of The Learned Commissioner Of Income-Tax (Appeals)/National Faceless Appeal Centre (Nfac), Delhi [“Ld. Cit(A)”, For Short] Dated 01.08.2023For The Assessment Year 2017-18. 2. Brief Facts Of The Case Are, Assessee Filed Its Return Of Income For Ay 2017-18 On 07.11.2017 Declaring An Income Of Rs.1,27,520/-. The Case Was Selected For Limited Scrutiny Under Cass & Accordingly, Notices U/S 143(2) & 142(1) Of The Income-Tax Act, 1961 (For Short ‘The Act’)

For Appellant: Shri Harshit Srivastav, CAFor Respondent: Shri Ajay Kumar Arora, Sr. DR

Section 115BSection 142(1)Section 143(2)Section 69

observed that the only issue under consideration is the investment made by the assessee in property for the value of Rs.1.11 crores as unexplained investment within the meaning of section 69 of the Act. During assessment proceedings, the AO has asked the information relating to the above investment and since ... documents were submitted before him, AO treated the same as unexplained investment. Further he observed that the assessee submitted that the said property was funded by liquidating the investment made in other companies i.e. investee companies. Also the assessee highlighted the fact that it made the above payment of Rs.1.11

Vijayakumar Sivanndan Nair, Cherthala vs. Income Tax Officer, Alappuzha

In the result, the appeal of the assessee bearing ITA No

ITA 658/COCH/2025[2015-16]Status: DisposedITAT Cochin13 Nov 2025AY 2015-16

Bench: the Ld. CIT(A). The Ld.AR stated that appeal was filed with a delay of 268 days before the Ld. CIT(A) against the order of Ld.AO. The Ld. CIT(A) passed the order without considering the merit of the case and rejected the appeal on the ground of limitation. Being aggrieved the assessee filed an appeal before us.3. The Ld. CIT(A), however, rejected the appeals on the ground of limitation, without allowing reasonable opportunity to the assessee on merits. In our considered view, reasonable opp

For Appellant: Shri Rajanesh, C.AFor Respondent: Shri Leena Lal, (SR.AR.)

Section 147Section 250

rival submission and considered the document available on record. The Ld. AO completed the assessment by additions amount to Rs. 89,97,600/- related unexplained investment and amount to Rs. 224,000/- related unexplained money. The aggrieved assessee filed an appeal before the Ld. CIT(A).The Ld.AR stated that

Rohit Jain, Tonk vs. Income Tax Officer, Ward, Tonk

In the result, the appeals of the assessee are allowed

ITA 760/JPR/2025[2015-16]Status: DisposedITAT Jaipur13 Nov 2025AY 2015-16

For Appellant: Shri Jaideep Malik, AdvocateFor Respondent: Mrs. Alka Gauta, CIT-DR

Section 153CSection 69C

circumstances of the case, the Ld.AO has factually and legally erred in making addition of Rs.12,00,000/- on account of alleged unexplained investment in the property, in absence of any incriminating material found and seized during the course of search proceedings. No valid addition could be made u/s 153C

Rohit Jain, Tonk vs. Income Tax Officer - Ward, Tonk

In the result, the appeals of the assessee are allowed

ITA 759/JPR/2025[2012-13]Status: DisposedITAT Jaipur13 Nov 2025AY 2012-13

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

For Appellant: Shri Jaideep Malik, AdvocateFor Respondent: Mrs. Alka Gauta, CIT-DR

Section 153CSection 69C

Mohit Jain, Tonk vs. Income Tax Officer, Tonk

In the result, the appeals of the assessee are allowed

ITA 758/JPR/2025[2015-16]Status: DisposedITAT Jaipur13 Nov 2025AY 2015-16

For Appellant: Shri Jaideep Malik, AdvocateFor Respondent: Mrs. Alka Gauta, CIT-DR

Section 153CSection 69C