← All Phrases

“unexplained expenditure”

Cash Credits & Unexplained ItemsSection 69CSection 69C3,276 judgments

The decision most relied on for unexplained expenditure is CIT v. Bholanath Poly Fab. Pvt. Ltd. (355 ITR 290), cited in 712 judgments on BharatTax.

Leading authorities on unexplained expenditure

CIT v. Bholanath Poly Fab. Pvt. Ltd.
355 ITR 290 · 2013 · High Court
712
citing judgments

If an assessee makes purchases from bogus parties, but the underlying goods are genuinely acquired and sold, only the profit margin embedded in such purchases, and not the entire value of the bogus purchases, should be added to the assessee's income.

Vijay Proteins Ltd. v. Asst. CIT
58 ITD 428 · 1996 · ITAT
430
citing judgments

Where purchases are found to be non-genuine or fictitious, a reasonable disallowance of 25% of such purchases or the peak credit, whichever is higher, can be made. This is applied to address unexplained expenditure under Section 69C when actual goods are likely procured from the grey market.

Nikunj Eximp Enterprises v. CIT
216 Taxmann 171 · 2013 · High Court
325
citing judgments

Purchases may be treated as genuine even if the purchase parties are untraceable or not available for verification, as long as there is no specific evidence from the parties themselves denying the transactions or proving them to be bogus.

CIT v. M.K. Brothers
163 ITR 249 · 1987 · High Court
262
citing judgments

Mere non-production of a party or their denial of a transaction is insufficient to treat a payment as non-genuine if it is duly recorded in books and made through banking channels. Once the assessee furnishes relevant documentation, the burden shifts to the Assessing Officer to prove the transaction is not genuine.

N.K. Proteins Ltd. v. DCIT
84 Taxmann.com 195 · 2017 · Supreme Court
204
citing judgments

When purchases are found to be entirely bogus and based on fictitious invoices from non-existent or unconfirmed suppliers, the entire amount of such purchases is liable to be added back as unexplained expenditure, not merely a percentage thereof.

CIT v. La Medica
250 ITR 575 · 2001 · High Court
150
citing judgments

When purchases are shown to be non-genuine, the entire amount is to be disallowed as unexplained expenditure under section 69C, irrespective of whether the goods were procured from alternative sources.

Vijay Proteins Ltd. v. CIT
58 Taxmann.com 44 · 2015 · High Court
140
citing judgments

When an assessee makes alleged bogus or hawala purchases but subsequently makes genuine sales from those purchases, the addition to income should be restricted only to the estimated profit embedded in such transactions, not the entire purchase value.

N.K. Industries Ltd. v. DCIT
72 Taxmann.com 289 · 2016 · High Court
127
citing judgments

When there is a categorical finding that purchases are bogus and from fictitious suppliers, the Assessing Officer is justified in making a 100% addition of the bogus purchase amount under Section 69C, rather than restricting the disallowance to merely the profit margin. This position has been upheld by the Supreme Court through the dismissal of the assessee's SLP.

Judgments citing unexplained expenditure

Citron Infraproject Ltd., Mumbai-400005 vs. Dy Commissioner of Income Tax, Central Circle-7(2), Mumbai

ITA 1276/MUM/2022[2014-15]Status: DisposedITAT Mumbai30 Apr 2024AY 2014-15

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

group including the assessee. Thereafter the learned assessing officer held that there is an addition under section 69C of the act being unexplained expenditure on account of commission paid on accommodation entries of sales and purchases is taxable in the hands of the assessee. The learned assessing officer noted that ... 17/10/2016 of ₹ 7,80,22,797/–. Thus, the addition of 712,745,262/– is the addition under section 69C of the act as an unexplained expenditure on account of commission paid on accommodation entries of sales and purchases of the assessee at the rate of 3% was also made taxable

Svp South West Industries Ltd. (Formerly, Platinum Textile Ltd.), Mumbai-400005 vs. Commissioner of Income Tax, Central Circle-8(2), Mumbai

ITA 1275/MUM/2022[2016-17]Status: DisposedITAT Mumbai30 Apr 2024AY 2016-17

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

group including the assessee. Thereafter the learned assessing officer held that there is an addition under section 69C of the act being unexplained expenditure on account of commission paid on accommodation entries of sales and purchases is taxable in the hands of the assessee. The learned assessing officer noted that ... 17/10/2016 of ₹ 7,80,22,797/–. Thus, the addition of ₹ 712,745,262/– is the addition under section 69C of the act as an unexplained expenditure on account of commission paid on accommodation entries of sales and purchases of the assessee at the rate of 3% was also made taxable

Svp South West Industries Ltd. (Formerly, Platinum Textile Ltd.), Mumbai-400005 vs. Commissioner of Income Tax, Central Circle-8(2), Mumbai

ITA 1274/MUM/2022[2012-13]Status: DisposedITAT Mumbai30 Apr 2024AY 2012-13

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

group including the assessee. Thereafter the learned assessing officer held that there is an addition under section 69C of the act being unexplained expenditure on account of commission paid on accommodation entries of sales and purchases is taxable in the hands of the assessee. The learned assessing officer noted that ... 17/10/2016 of ₹ 7,80,22,797/–. Thus, the addition of ₹ 712,745,262/– is the addition under section 69C of the act as an unexplained expenditure on account of commission paid on accommodation entries of sales and purchases of the assessee at the rate of 3% was also made taxable

Svp South West Industries Ltd. (Formerly, Platinum Textile Ltd.), Mumbai-400005 vs. Commissioner of Income Tax, Central Circle-8(2), Mumbai

ITA 1273/MUM/2022[2015-16]Status: DisposedITAT Mumbai30 Apr 2024AY 2015-16

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

group including the assessee. Thereafter the learned assessing officer held that there is an addition under section 69C of the act being unexplained expenditure on account of commission paid on accommodation entries of sales and purchases is taxable in the hands of the assessee. The learned assessing officer noted that ... 17/10/2016 of ₹ 7,80,22,797/–. Thus, the addition of ₹ 712,745,262/– is the addition under section 69C of the act as an unexplained expenditure on account of commission paid on accommodation entries of sales and purchases of the assessee at the rate of 3% was also made taxable

Svp South West Industries Ltd. (Formerly, Platinum Textile Ltd.), Mumbai-400005 vs. Commissioner of Income Tax, Central Circle-8(2), Mumbai

ITA 1272/MUM/2022[2017-18]Status: DisposedITAT Mumbai30 Apr 2024AY 2017-18

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

group including the assessee. Thereafter the learned assessing officer held that there is an addition under section 69C of the act being unexplained expenditure on account of commission paid on accommodation entries of sales and purchases is taxable in the hands of the assessee. The learned assessing officer noted that ... 17/10/2016 of ₹ 7,80,22,797/–. Thus, the addition of ₹ 712,745,262/– is the addition under section 69C of the act as an unexplained expenditure on account of commission paid on accommodation entries of sales and purchases of the assessee at the rate of 3% was also made taxable

Svp South West Industries Ltd. (Formerly, Platinum Textile Ltd.), Mumbai vs. DCIT, CC- 8(2), Mumbai

ITA 1271/MUM/2022[2013-14]Status: DisposedITAT Mumbai30 Apr 2024AY 2013-14

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

group including the assessee. Thereafter the learned assessing officer held that there is an addition under section 69C of the act being unexplained expenditure on account of commission paid on accommodation entries of sales and purchases is taxable in the hands of the assessee. The learned assessing officer noted that ... 17/10/2016 of ₹ 7,80,22,797/–. Thus, the addition of ₹ 712,745,262/– is the addition under section 69C of the act as an unexplained expenditure on account of commission paid on accommodation entries of sales and purchases of the assessee at the rate of 3% was also made taxable

Citron Infraproject Ltd., Mumbai-400005 vs. Dy Commissioner of Income Tax, Central Circle-7(2), Mumbai

ITA 1270/MUM/2022[2012-13]Status: DisposedITAT Mumbai30 Apr 2024AY 2012-13

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

group including the assessee. Thereafter the learned assessing officer held that there is an addition under section 69C of the act being unexplained expenditure on account of commission paid on accommodation entries of sales and purchases is taxable in the hands of the assessee. The learned assessing officer noted that ... 17/10/2016 of ₹ 7,80,22,797/–. Thus, the addition of ₹ 712,745,262/– is the addition under section 69C of the act as an unexplained expenditure on account of commission paid on accommodation entries of sales and purchases of the assessee at the rate of 3% was also made taxable

Svp South West Industries Ltd. (Formerly, Platinum Textile Ltd.), Mumbai-400005 vs. Commissioner of Income Tax, Central Circle-8(2), Mumbai

ITA 1269/MUM/2022[2014-15]Status: DisposedITAT Mumbai30 Apr 2024AY 2014-15

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

group including the assessee. Thereafter the learned assessing officer held that there is an addition under section 69C of the act being unexplained expenditure on account of commission paid on accommodation entries of sales and purchases is taxable in the hands of the assessee. The learned assessing officer noted that ... 17/10/2016 of ₹ 7,80,22,797/–. Thus, the addition of 712,745,262/– is the addition under section 69C of the act as an unexplained expenditure on account of commission paid on accommodation entries of sales and purchases of the assessee at the rate of 3% was also made taxable

Citron Infraproject Ltd., Mumbai-400005 vs. Dy Commissioner of Income Tax, Central Circle-7(2), Mumbai-400020

ITA 1268/MUM/2022[2018-19]Status: DisposedITAT Mumbai30 Apr 2024AY 2018-19

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

group including the assessee. Thereafter the learned assessing officer held that there is an addition under section 69C of the act being unexplained expenditure on account of commission paid on accommodation entries of sales and purchases is taxable in the hands of the assessee. The learned assessing officer noted that ... 17/10/2016 of ₹ 7,80,22,797/–. Thus, the addition of ₹ 712,745,262/– is the addition under section 69C of the act as an unexplained expenditure on account of commission paid on accommodation entries of sales and purchases of the assessee at the rate of 3% was also made taxable

Citron Infraproject Ltd., Mumbai-400005 vs. Dy Commissioner of Income Tax, Central Circle-7(2), Mumbai-20

ITA 1267/MUM/2022[2015-16]Status: DisposedITAT Mumbai30 Apr 2024AY 2015-16

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

group including the assessee. Thereafter the learned assessing officer held that there is an addition under section 69C of the act being unexplained expenditure on account of commission paid on accommodation entries of sales and purchases is taxable in the hands of the assessee. The learned assessing officer noted that ... 17/10/2016 of ₹ 7,80,22,797/–. Thus, the addition of ₹ 712,745,262/– is the addition under section 69C of the act as an unexplained expenditure on account of commission paid on accommodation entries of sales and purchases of the assessee at the rate of 3% was also made taxable

Raghav Technology P.Ltd, New Delhi vs. ITO, Ward-20(4), New Delhi

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

ITA 1064/DEL/2019[2010-11]Status: DisposedITAT Delhi30 Apr 2024AY 2010-11

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

Section 143(1)Section 147Section 148Section 151Section 68Section 69C

makes the impugned asstt. unsustainable in law. 6. That both the lower authorities erred in making and confirming the addition of Rs.54,000/- as unexplained expenditure u/s.69C for alleged commission expenses @1.8% of Rs.30,00,000/-, the amt. of total sale consideration received of both the shares, although there

Sunita Motilal Sinha, Mumbai vs. ITO 25(1)(3), Mumbai

In the result, the appeal of the assessee is allowed

ITA 3662/MUM/2023[2014-15]Status: DisposedITAT Mumbai29 Apr 2024AY 2014-15

Bench: Justice (Retd.) C V Bhadang, Hon’Ble& Shri B.R. Baskaranassessment Year 2014-15

For Appellant: Shri Mani JainFor Respondent: Shri Manoj Kumar Singh
Section 10(38)Section 131Section 133(6)Section 68Section 69C

have incurred expenses in procuring the bogus long term capital gains. He estimated the same at Rs.8,59,690/- and assessed the same as unexplained expenditure u/s 69C of the Act. The Ld CIT(A) confirmed the additions made by the AO and hence the assessee has filed this appeal

ACIT, Central Circle- 2, New Delhi vs. Mideast Integrated Steels Ltd., New Delhi

In the result, assessee’s appeal is partly allowed, whereas,

ITA 991/DEL/2018[2014-15]Status: DisposedITAT Delhi25 Apr 2024AY 2014-15

Bench: Shri Saktijit Dey, Vice- & Shri Naveen Chandraassessment Year: 2014-15

Section 115JSection 143(2)Section 143(3)Section 292B

Assessing Officer completed the assessment under section 143(3) of the Act vide order dated 30.12.2016, making couple of additions, as under: (i) Unexplained expenditure of Rs.78,68,52,192/- (ii) Unexplained purchases of Rs.66,04,678/- 5. Contesting the aforesaid additions, the assessee filed an appeal before learned first

Mideast Integrated Steels Ltd., New Delhi vs. ACIT, Central Circle-2, New Delhi

In the result, assessee’s appeal is partly allowed, whereas,

ITA 269/DEL/2018[2014-15]Status: DisposedITAT Delhi25 Apr 2024AY 2014-15

Bench: Shri Saktijit Dey, Vice- & Shri Naveen Chandraassessment Year: 2014-15

Section 115JSection 143(2)Section 143(3)Section 292B

Assessing Officer completed the assessment under section 143(3) of the Act vide order dated 30.12.2016, making couple of additions, as under: (i) Unexplained expenditure of Rs.78,68,52,192/- (ii) Unexplained purchases of Rs.66,04,678/- 5. Contesting the aforesaid additions, the assessee filed an appeal before learned first

M/S. Shivam Developers, Gandhinagar vs. The DCIT, Mehsana Circle, Mehsana

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

ITA 226/AHD/2020[2012-13]Status: DisposedITAT Ahmedabad24 Apr 2024AY 2012-13

Bench: Shri Siddhartha Nautiyal & Shri Makarand V. Mahadeokar, Accountnat Member Assessment Year : 2012-13 M/S.Shivam Developers The Dy.Cit Plot No.C/1, 1301, Phase-I Vs Mehsana Circle Gidc, Chhatral, Tal.Kalol Mehsana Dist. Gandhinagar – 382 229 Pan: Abwfs 4815 N अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Shri Hardik Vora, Ar & Shri Daivat Bhatt, Ar Revenue By : Shri Ashesh R. Rewar, Sr.Dr सुनवाई क" तार"ख/Date Of Hearing : 17/04/2024 घोषणा क" तार"ख /Date Of Pronouncement: 24/04/2024 आदेश/O R D E R Per Makarand V. Mahadeokarthe Present Appeal Has Been Filed By The Assessee Against The Order Of The Learned Commissioner Of Income Tax (Appeals), Gandhinagar, Ahmedabad [Hereinafter Referred To As “Cit(A)” In Short] Arising In The Matter Of Assessment Order Passed Under S. 143(3) R.W.S. 147 Of The Income Tax Act, 1961 (Hereinafter Referred To As "The Act") Relevant To The Assessment Year (Ay) 2012-13. 2. The Assessee Has Raised Following Grounds Of Appeal: M/S.Shivam Developers Vs. Dcit Mehsana Asst. Year : 2012-13

For Appellant: Shri Hardik Vora, AR &For Respondent: Shri Ashesh R. Rewar, Sr.DR
Section 148Section 69C

taken from Jadhav Tractors of Rs.19,00,000/- and unsecured loan taken from Bhadresh Shah of Rs. 14,00,000/-, should be treated as unexplained expenditure. 5.3. The AO further concluded that the booking advance taken in cash totalling to Rs.10,27,250/- from nine parties also could ... However, M/s.Shivam Developers vs. DCIT Mehsana Asst. Year : 2012-13 the addition made by AO is under section 69C of the Act as unexplained expenditure. 12.4. Since the identity, genuineness and creditworthiness of the depositor are proved by the assessee and hence the primary onus cast upon the assessee

Chaitali Gems, Mumbai vs. Income Tax Office, 19(1)(1), Mumbai

In the result, appeal of the assessee is partly allowed

ITA 3927/MUM/2023[2010-11]Status: DisposedITAT Mumbai23 Apr 2024AY 2010-11

Bench: Shri Prashant Maharishi, Am & Shri Raj Kumar Chauhan, Jm Chaitali Gems Income Tax Office Dw-6110, Bharat Diamond 19(1)(1) Bourse, Bandra Kurla Vs. Piramal Chambers, Complex, Bandra East, Lalbagh, Mumbai-400 012 Mumbai-400 051 (Appellant) (Respondent) Pan No. Aaafc2052Q Assessee By : Shri K.A. Vaidyalingan, Ar Revenue By : Shri H.M. Bhatt, Dr

For Appellant: Shri K.A. Vaidyalingan, ARFor Respondent: Shri H.M. Bhatt, DR
Section 143Section 147Section 69C

extent of Rs.32,08,953/- (though quantum addition is reduced from Rs. 1,31,65,072/-) of the alleged bogus purchases as unexplained expenditure u/s. 69C even though the impugned transactions have been recorded in the duly audited regular books of account of the Appellant and all payments have been

ACIT CC-14, Delhi vs. Delhi Spot Bullion Trading Co. Pvt. Ltd., Delhi

In the result, the appeal of the Revenue is dismissed

ITA 1965/DEL/2021[2017-18]Status: DisposedITAT Delhi23 Apr 2024AY 2017-18

Bench: Dr. B. R. R. Kumarms. Astha Chandra

For Appellant: Sh. Anuj Jain, CAFor Respondent: Sh. Amit Katoch, Sr. DR
Section 143(3)

question of any disallowance. In the second paragraph above, the Assessing Officer has alternatively applied Section 69C. Section 69C is also for unexplained expenditure. Admittedly, there is no question of any unexplained expenditure in the case under appeal before us and therefore, Section 69C is also not applicable. 9. Further

Income Tax Officer - 42(1)(3), Mumbai vs. Kinjal Manish Seth, Mumbai

Accordingly, the Ground No. 1 to 4 raised by the Revenue are dismissed

ITA 2883/MUM/2023[2018-19]Status: DisposedITAT Mumbai18 Apr 2024AY 2018-19

Bench: giving relief to the assessee? 3. The relevant facts in brief are that the Assessee is an importer/dealer in industrial and commercial goods. For the

For Appellant: Shri Rajesh KalyaniFor Respondent: Shri P.D. Chougule
Section 143Section 143(3)Section 609CSection 69C

circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of Rs. 8,21,80,218/- as unexplained expenditure u/s 69C of the IT Act 1961? 2 Whether on the facts and the circumstances of the case ... huge difference of INR 8,21,00,218/-, the Assessee was asked to show cause why the aforesaid amount should not be treated as unexplained expenditure in terms of Section 69C of the Act and added back to the income of the Assessee. In response, the Assessee filed reply explaining

Shri Rameshbhai N. Savaliya, Ahmedabad vs. The Deputy Commissioner of Income Tax, Central Circle-1(1), Ahmedabad

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

ITA 1124/AHD/2017[2010-11]Status: DisposedITAT Ahmedabad17 Apr 2024AY 2010-11

Bench: Smt.Annapurna Gupta & Ms. Suchitra Kambleassessment Year : 2010-11 Smt. Lilaben Rameshbhai The Dy.Cit Savaliya Vs Central Circle-1(1) Legal Heir Of Rameshbhai Ahmedabad N.Savaliya 12, Paritosh Bungalows Satellite Ahmedabad – 380 015 Pan: Abjps 1312 D अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Shri Sanjay R. Shah, Ar Revenue By : Ms. Saumya Pandey Jain, Sr.Dr सुनवाई क" तार"ख/Date Of Hearing : 22/02/2024 घोषणा क" तार"ख /Date Of Pronouncement: 17/04/2024 आदेश/O R D E R Per Ms. Suchitra Kamblethis Appeal Is Filed By The Assessee Against The Order Dated 18/01/2017 Passed By The Commissioner Of Income-Tax (Appeals)-11, Ahmedabad [Hereinafter Referred To As “Cit(A)” In Short] For Assessment Year (Ay) 2010-11. 2. Grounds Of Appeal Are As Under: 1. The Learned Commissioner Of Income Tax, (Appeals)-11, Ahmedabad Has Erred In Law & On Facts Of The Case In Confirming The Addition Made By The Smt.Lilaben Rameshbhai .Savaliya Legal Heir Of Shri Rameshbhai N. Savaliya Asst.Year 2010-11

For Appellant: Shri Sanjay R. Shah, ARFor Respondent: Ms. Saumya Pandey Jain, Sr.DR
Section 142(1)Section 143(1)Section 143(2)Section 148

Smt.Lilaben Rameshbhai .Savaliya Legal Heir of Shri Rameshbhai N. Savaliya Asst.Year 2010-11 The Assessing Officer also made disallowance on account of unexplained expenditure on agricultural income to the extent of Rs.1,06,204/- and disallowance on account of non-business expenditure amounting to Rs.2,01,668/-. 4. Being aggrieved

M/S. Nine Globe Industries Pvt. Ltd., Mumbai vs. ACIT-7(2)(2), Mumbai

In the result, the appeal is partly allowed

ITA 3889/MUM/2023[2012-13]Status: DisposedITAT Mumbai16 Apr 2024AY 2012-13

Bench: Justice (Retd.) C.V. Bhadang & Shri B.R. Baskaran: A.Y : 2012-13 M/S. Nine Globe Industries Pvt. Ltd. Vs. Asst. Commissioner Of Income 402A, Prathamesh Tower, Tax, Circle-7(2)(2), Mumbai. 11-12, S.B. Marg, (Respondent) Lower Parel, Mumbai. Pan : Aaccn8403F (Appellant)

For Appellant: Ms. Aishwarya VanikarFor Respondent: Shri S. Srinivasu
Section 144Section 148Section 156Section 249(4)Section 69C

details and upon consideration of the same, the AO by an order dated 23.12.2019 made addition of Rs.14,31,25,612/- on account of unexplained expenditure under Section 69C of the Act. 3. In appeal, the Commissioner of Income Tax (Appeals), NFAC, Delhi (‘CIT(A)’ for short) found that