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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

Sunil Kharbanda, New Delhi vs. ACIT, Circle-50(1), Delhi

ITA 392/DEL/2024[2018-19]Status: DisposedITAT Delhi15 Jul 2025AY 2018-19

Bench: Shri Satbeer Singh Godara & Shri S. Rifaur Rahman

Section 144

appellate discussion. The factual position is hardly any different in the assessee’s latter assessment year’s appeal ITA No. 392/Del/2024 as well wherein unexplained investment of Rs. 3.47 crores and estimate gross profit of Rs. 47,51,145/- ; respectively, form subject matter of addition which stands affirmed ... light of Rule 29 of the I.T. Rules to rebut both the lower authorities findings alleging his failure in proving the source of these unexplained investments as well gross profit estimation, as the case may be. The Revenue could hardly dispute that the assessee’s above additional evidence indeed

Sunil Kharbanda, New Delhi vs. ACIT, Circle-50(1), New Delhi

ITA 391/DEL/2024[2017-18]Status: DisposedITAT Delhi15 Jul 2025AY 2017-18

Bench: Shri Satbeer Singh Godara & Shri S. Rifaur Rahman

Section 144

appellate discussion. The factual position is hardly any different in the assessee’s latter assessment year’s appeal ITA No. 392/Del/2024 as well wherein unexplained investment of Rs. 3.47 crores and estimate gross profit of Rs. 47,51,145/- ; respectively, form subject matter of addition which stands affirmed ... light of Rule 29 of the I.T. Rules to rebut both the lower authorities findings alleging his failure in proving the source of these unexplained investments as well gross profit estimation, as the case may be. The Revenue could hardly dispute that the assessee’s above additional evidence indeed

Raghvendra Singh Thakur, Raipur vs. Income Tax Officer-4(1), Raipur

The appeal is allowed

ITA 242/RPR/2025[2013-14]Status: DisposedITAT Raipur14 Jul 2025AY 2013-14

Bench: Shri Partha Sarathi Chaudhuryआयकर अपील सं./Ita No.242/Rpr/2025 "नधा"रण वष" /Assessment Year: 2013-14 Raghvendra Singh Thakur, H.No.238, Sarona, Tatibandh, Raipur, 492001, Chhattisgarh Pan: Akbpt7616E .......अपीलाथ" / Appellant बनाम / V/S.

For Appellant: Shri Veekas S. Sharma, CAFor Respondent: Dr. Priyanka Patel, Sr. DR
Section 10Section 10(14)(ii)Section 69rSection 80C

dismissed.” 5. At the outset, on this issue, it is noted that the AO had made addition u/s.69 of the Act which refers to unexplained investment. However, in this case, the assessee had neither purchased nor sold any moveable or immoveable property, nor had invested in any such property ... assessee by way of self speaking documentary evidence and explanation. Secondly, the AO has made addition u/s 69 of the Act which pertains to unexplained investments, whereas the assessee has not made any investment either in movable or any immovable property during the relevant period by way of using cash

Income Tax Officer, Ward-10(1), Pune vs. Dharamveer Sambhaji Nagari Sahakari Patsanstha Maryadit, Narayan Gaon

In the result, the appeal filed by the Revenue is allowed for

ITA 1639/PUN/2024[2020-21]Status: DisposedITAT Pune14 Jul 2025AY 2020-21

Bench: Shri Manish Borad & Shri Vinay Bhamoreआयकर अपील सं. / Ita No.1639/Pun/2024 "नधा"रण वष" / Assessment Year : 2020-21

For Appellant: NoneFor Respondent: Shri Ramnath P. Murkunde
Section 143(3)Section 250Section 250(6)Section 80P

income declared by the assessee, Ld. JAO has assessed the income at Rs.1,43,89,668/- comprising of various additions on account of unexplained investments, difference in interest income and disallowance of deduction u/s 80P of the Act. However, in the appeal filed before Ld. CIT(A)/NFAC, assessee furnished

Ashok Bharti Goswami, Pune vs. ACIT, Central Circle 2(1), Pune

In the result, all the appeals filed by the respective assessees are allowed

ITA 1272/PUN/2024[2018-19]Status: DisposedITAT Pune14 Jul 2025AY 2018-19

Bench: Shri R. K. Panda & Shri Vinay Bhamore

For Appellant: S/Shri Kishor B Phadke &For Respondent: S/Shri Sandeep Sengupta, CIT &
Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

Ashish Ramesh Oswal, Pune vs. ACIT, Central Circle 2(1), Pune

ITA 1271/PUN/2024[2017-18]Status: DisposedITAT Pune14 Jul 2025AY 2017-18

Bench: Shri R. K. Panda & Shri Vinay Bhamore

For Appellant: S/Shri Kishor B Phadke &For Respondent: S/Shri Sandeep Sengupta, CIT &
Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

Adish Shantilal Solanki, Pune vs. Assistant Commissioner of Income Tax, Central Circle-2(1), Pune

ITA 1270/PUN/2024[2017-18]Status: DisposedITAT Pune14 Jul 2025AY 2017-18

Bench: Shri R. K. Panda & Shri Vinay Bhamore

Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

Chitra Narendra Parmar, Pune vs. Assistant Commissioner of Income Tax, Central Circle-2(1), Pune

In the result, all the appeals filed by the respective assessees are allowed

ITA 1269/PUN/2024[2017-18]Status: DisposedITAT Pune14 Jul 2025AY 2017-18

Bench: Shri R. K. Panda & Shri Vinay Bhamore

For Appellant: S/Shri Kishor B Phadke &For Respondent: S/Shri Sandeep Sengupta, CIT &
Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

Ramlal Bhikulal Shah, Pune vs. ACIT, Central Circle 2(1), Pune

In the result, all the appeals filed by the respective assessees are allowed

ITA 1268/PUN/2024[2017-18]Status: DisposedITAT Pune14 Jul 2025AY 2017-18

Bench: Shri R. K. Panda & Shri Vinay Bhamore

For Appellant: S/Shri Kishor B Phadke &For Respondent: S/Shri Sandeep Sengupta, CIT &
Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

Deepak Kantilal Jain, Pune vs. ACIT, Central Circle 2(1), Pune

The appeal stands dismissed

ITA 1267/PUN/2024[2017-18]Status: DisposedITAT Pune14 Jul 2025AY 2017-18

Bench: Shri R. K. Panda & Shri Vinay Bhamore

Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

Ashish Ramesh Oswal, Pune vs. ACIT, Central Circle 2(1), Pune

In the result, all the appeals filed by the respective assessees are allowed

ITA 1266/PUN/2024[2016-17]Status: DisposedITAT Pune14 Jul 2025AY 2016-17

Bench: Shri R. K. Panda & Shri Vinay Bhamore

For Appellant: S/Shri Kishor B Phadke &For Respondent: S/Shri Sandeep Sengupta, CIT &
Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

Deepak Kantilal Jain, Pune vs. ACIT, Central Circle 2(1), Pune

The appeal stands dismissed

ITA 1265/PUN/2024[2016-17]Status: DisposedITAT Pune14 Jul 2025AY 2016-17

Bench: Shri R. K. Panda & Shri Vinay Bhamore

Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

Ramanlal Bhikulal Shah, Pune vs. ACIT, Central Circle 2(1), Pune

In the result, all the appeals filed by the respective assessees are allowed

ITA 1264/PUN/2024[2016-17]Status: DisposedITAT Pune14 Jul 2025AY 2016-17

Bench: Shri R. K. Panda & Shri Vinay Bhamore

For Appellant: S/Shri Kishor B Phadke &For Respondent: S/Shri Sandeep Sengupta, CIT &
Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

Ashok Bharti Goswami, Pune vs. ACIT, Central Circle 2(1), Pune

ITA 1263/PUN/2024[2016-17]Status: DisposedITAT Pune14 Jul 2025AY 2016-17

Bench: Shri R. K. Panda & Shri Vinay Bhamore

Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

Chitra Narendra Parmar, Pune vs. ACIT, Central Circle 2(1), Pune

In the result, all the appeals filed by the respective assessees are allowed

ITA 1262/PUN/2024[2016-17]Status: DisposedITAT Pune14 Jul 2025AY 2016-17

Bench: Shri R. K. Panda & Shri Vinay Bhamore

For Appellant: S/Shri Kishor B Phadke &For Respondent: S/Shri Sandeep Sengupta, CIT &
Section 131Section 132Section 142(1)Section 143(1)Section 153C

absence of any satisfactory reply given by the assessee, the Assessing Officer, relying on various decisions, made addition of Rs.25 lakh being the unexplained investment made in cash for assessment year 2016-17. Similarly, he made addition of Rs.20 lakh for assessment year 2017-18. 9. In appeal ... Pune-12 and ACIT Central Circle-2(1), Pune has erred in law and in fact in treating amount of Rs.25,00,000/- as unexplained investment u/s 69 of the IT Act without taking into consideration the fact that appellant has not paid any cash on money amount as unexplained

I K Corporation, Surat vs. ITO, Ward 1(3)(2), Surat

In the result, assessee’s appeal is allowed for statistical purposes

ITA 790/SRT/2024[2009-10]Status: DisposedITAT Surat11 Jul 2025AY 2009-10

Bench: Ms Suchitra Raghunath Kamble & Shri Bijayananda Prusethआयकर अपील सं./Ita Nos.789 & 790/Srt/2024 Assessment Year: (2009-10) (Hybrid Hearing) I K. Corporation Income Tax Officer, बनाम/ E-407, Krishna Township, Ward -1(3)(2), Surat, Room No.203, Vs. Nr. Govindji Hall, Dabholi 2Nd Floor, Aaykar Bhavan, Anavil Road, Katargam, Surat-395 Business Center, Adajan Road, Surat- 004 395 009 "थायीलेखासं./जीआइआरसं./Pan/Gir No: Aacfi 2599 E (Appellant) (Respondent)

Section 142(1)Section 147Section 148Section 250Section 253(3)Section 271(1)(c)Section 69Section 69A

NFAC has erred in confirming the action of A.O in making addition of cash deposits and cash credits of Rs.42,50,000/- as unexplained investment.” “4. On the facts and circumstances of the case as well as law on the subject, NFAC has erred in confirming the action

I K Corporation, Surat vs. ITO, Ward-1(3)(2), Surat

In the result, assessee’s appeal is allowed for statistical purposes

ITA 789/SRT/2024[2009-10]Status: DisposedITAT Surat11 Jul 2025AY 2009-10

Bench: Ms Suchitra Raghunath Kamble & Shri Bijayananda Prusethआयकर अपील सं./Ita Nos.789 & 790/Srt/2024 Assessment Year: (2009-10) (Hybrid Hearing) I K. Corporation Income Tax Officer, बनाम/ E-407, Krishna Township, Ward -1(3)(2), Surat, Room No.203, Vs. Nr. Govindji Hall, Dabholi 2Nd Floor, Aaykar Bhavan, Anavil Road, Katargam, Surat-395 Business Center, Adajan Road, Surat- 004 395 009 "थायीलेखासं./जीआइआरसं./Pan/Gir No: Aacfi 2599 E (Appellant) (Respondent)

Section 142(1)Section 147Section 148Section 250Section 253(3)Section 271(1)(c)Section 69Section 69A

NFAC has erred in confirming the action of A.O in making addition of cash deposits and cash credits of Rs.42,50,000/- as unexplained investment.” “4. On the facts and circumstances of the case as well as law on the subject, NFAC has erred in confirming the action

Pradipsinh Ghanshyamsinh Vaghela, Ahmedabad vs. The ITO, Ward-3(2)(1), Ahmedabad

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

ITA 325/AHD/2025[2018-19]Status: DisposedITAT Ahmedabad11 Jul 2025AY 2018-19

Bench: SHRI SANJAY GARG (Judicial Member), SMT. ANNAPURNA GUPTA (Accountant Member)

For Appellant: Shri Pradeep Tulsian, A.RFor Respondent: Shri R P Rastogi, CIT. DR
Section 148Section 148ASection 250

case, addition was made to the income of the assessee on account of capital gains earned from sale of land amounting to Rs.40 Lakhs, unexplained investment made in land of Rs.38 Lakhs and interest and other income earned by the assessee amounting to Rs.15.38 Lakhs. The assessee

Rama Sunil Kerkar, Radhanagari vs. Income Tax Office, Kolhapur

In the result, the appeal of the assessee is allowed

ITA 1538/PUN/2025[2019-20]Status: DisposedITAT Pune10 Jul 2025AY 2019-20

Bench: Shri Manish Boradआयकर अपील सं. / Ita No.1538/Pun/2025 िनधा"रण वष" / Assessment Year : 2019-20 Rama Sunil Kerkar, Vs. Ito, Nfac, Delhi. Kerkar, Gavthan, Radhanagar, S.O. Kolhapur- 416212. Pan : Ihlpk4562F Appellant Respondent Assessee By : Shri Pramod S. Shingte Revenue By : Shri Deepak Kumar Kedia Date Of Hearing : 10.07.2025 Date Of Pronouncement : 10.07.2025 आदेश / Order Per Manish Borad, Am: This Appeal Filed At The Instance Of Assessee Is Directed Against The Order Of Ld. Cit(A)/Nfac Dated 06.06.2025 For A.Y. 2019-20. 2. Sole Issue For My Consideration Is Regarding The Addition Of Rs.6,45,781/- Made By The Assessing Officer U/S 69 Of The Act For Unexplained Fixed Deposit. 3. I Have Heard Rival Contentions & Perused The Records Placed Before Me. Ld. Counsel For The Assessee Has Stated That Ld. Assessing Officer Has Made Addition For Unexplained Investment In The Form Of Fixed Deposit With Bank Of India At Rs.6,45,781/- & The Source Of This Fixed Deposit Is From The Bank Transfer Received

For Appellant: Shri Pramod S. ShingteFor Respondent: Shri Deepak Kumar Kedia
Section 69

rival contentions and perused the records placed before me. Ld. Counsel for the assessee has stated that Ld. Assessing Officer has made addition for unexplained investment in the form of fixed deposit with Bank of India at Rs.6,45,781/- and the source of this fixed deposit is from

Gudhi Sujatha, Chennai vs. ITO, Ncw-9(4), Chennai

In the result the appeal of the assessee is partly allowed

ITA 375/CHNY/2025[2012-13]Status: DisposedITAT Chennai10 Jul 2025AY 2012-13

Bench: Shri S.S. Viswanethra Ravi & Shri S. R. Raghunathaआयकर अपील सं./Ita No.:375/Chny/2025 िनधा"रण वष" / Assessment Year: 2012-13 Gudhi Sujatha, Income Tax Officer, New No.372, Old No.197, Vs. Non Corporate Ward – 9(4), Triplicane High Road, Chennai. Triplicane, Chennai – 600 005. [Pan:Arjps-6830-N] (अपीलाथ"/Appellant) (""थ"/Respondent) अपीलाथ" की ओर से/Appellant By : Shri. T. Vasudevan, Advocate. ""थ" की ओर से/Respondent By : Shri. P. Krishna Kumar, J.C.I.T.

For Appellant: Shri. T. Vasudevan, AdvocateFor Respondent: Shri. P. Krishna Kumar, J.C.I.T
Section 119(2)(b)Section 144Section 147Section 69

passed an exparte order u/s.144 r.w.s 147 of the Act dated 04.12.2019 by making an addition of Rs.17,95,600/- as unexplained investment u/s.69 of the Act, based on the cash deposit made in the savings bank account maintained with KVB, Triplicane Branch by rejecting the return of income