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“undisclosed income”

Search & SeizureSection 153ASection 153A9,092 judgments

The decision most relied on for undisclosed income is CIT v. Kabul Chawla (380 ITR 573), cited in 3,235 judgments on BharatTax.

Leading authorities on undisclosed income

CIT v. Kabul Chawla
380 ITR 573 · 2016 · High Court
3,235
citing judgments

In a search assessment under Section 153A, additions can only be made for completed or non-abated assessment years if incriminating material relevant to those years is found during the search, although notice under Section 153A(1) is mandatorily issued for six assessment years preceding the search.

CIT v. Simit P. Sheth
356 ITR 451 · 2013 · High Court
1,465
citing judgments

Additions for alleged bogus purchases should be restricted to the profit element, not the entire turnover. The profit element is often estimated at 12.5% of the purported bogus purchases.

Commissioner of Income Tax v. Harjeev Aggarwal
290 CTR 263 · 2016 · High Court
583
citing judgments

Assessment based solely on a statement recorded under Section 132(4) of the Income Tax Act requires the statement to be relatable to incriminating material or evidence found during the search, especially when considering Section 158BB(1) which restricts computation of undisclosed income to evidence found during search.

CIT v. Anil Kumar Bhatia
352 ITR 493 · 2013 · High Court
537
citing judgments

Section 153A can be invoked to reassess income for all years under consideration prior to a search, even if returns for those years were processed under Section 143(1)(a). The Assessing Officer has the power to reassess total income in such cases without fetters.

CIT v. P. Mohanakala
291 ITR 278 · 2007 · Supreme Court
525
citing judgments

The Supreme Court emphasized that in the absence of concrete rebuttal by the assessee, circumstantial evidence holds significant weight, applying the doctrine of preponderance of probability, particularly when assessing undisclosed income or unexplained cash credits.

Society v. UOI
394 ITR 220 · 2017 · Supreme Court
493
citing judgments

Uncorroborated loose papers or documents found during a search operation have no evidentiary value and cannot be the sole basis for determining undisclosed income. Additions based on such material require independent evidence to establish trustworthiness and a direct link to the assessee.

CIT v. President Industries
258 ITR 654 · 2002 · High Court
471
citing judgments

When books of account are rejected and unaccounted sales or receipts are discovered, the income addition is restricted to the net profit element embedded in these undisclosed transactions, not the entire sale proceeds or receipts, especially if corresponding purchases are not proven to be outside the books.

CIT v. Gurinder Singh Bawa
386 ITR 483 · 2016 · High Court
416
citing judgments

If no incriminating material is found during a search operation regarding a particular issue, then no addition can be made concerning that issue in an assessment under section 153A of the Income-tax Act.

Judgments citing undisclosed income

Sh. Kesar Kadir Khan, Jaipur vs. ITO, Ward-5(3), Jaipur

In the result, the appeal of the assessee is allowed with no order as to costs

ITA 372/JPR/2024[2017-18]Status: DisposedITAT Jaipur06 Aug 2024AY 2017-18

Bench: SHRI SANDEEP GOSAIN (Judicial Member)

For Appellant: Shri P.C. Parwal, CAFor Respondent: Mrs. Monisha Choudhary, Addl. CIT-DR
Section 115BSection 69A

hereby added in return of income of the assessee and charged to income tax as unexplained money u/s 69A r.w.s. 115BBE trading undisclosed income under the head of other sources of the previous year relevant to the A.Y. 2017-18. 5 SHRI KESAR KADIR KHAN VS ITO, WARD ... extent it was deposited back in the bank account has been used somewhere else. Hence it cannot be presumed that assessee has any undisclosed income which is deposited in the bank account. AO made the addition u/s 69A of the Act. This section uses the word ‘may’ and not ‘shall

Shailesh Kumar Jain, Kota vs. ACIT, Income Tax Department

In the result, the appeal of the assessee is partly allowed with no orders as to costs

ITA 266/JPR/2024[2017-18]Status: DisposedITAT Jaipur06 Aug 2024AY 2017-18
For Appellant: Shri Nikhlesh Kataria, CAFor Respondent: Mrs. Monisha Choudhary, Addl. CIT-DR
Section 143(3)Section 69A

income by holding that said amount of cash deposited by the assessee in his bank account during the demonetization period is nothing but the undisclosed income of assessee which was shown under the garb of cash sales and thus it is liable to be added under

Shah Sandeep Anantkumar HUF, Mumbai vs. ITO-32(3)(4), Mumbai

In the result, the appeal by the assessee is allowed

ITA 4628/MUM/2023[2012-13]Status: DisposedITAT Mumbai06 Aug 2024AY 2012-13

Bench: Shri Sandeep Singh Karhail & Smt. Renu Jauhri

For Appellant: Shri Rajesh KothariFor Respondent: Shri R.R.Makwana, Sr.DR
Section 143(1)Section 143(2)Section 143(3)Section 147Section 148Section 250Section 68Section 69A

authorities have recorded a clear finding of fact that the assessee had indulged in a dubious shares transaction meant to account for the undisclosed income in the garb of long term capital gain. While so observing, the authorities held that the assessee had not tendered cogent evidence to explain

Deputy Commissioner of Income Tax, Aurangabad vs. Vista Nirman Pvt. Ltd., Mumbai

ITA 1340/PUN/2023[2011-12]Status: DisposedITAT Pune05 Aug 2024AY 2011-12

Bench: Shri R. K. Panda & Ms Astha Chandraassessment Year : 2011-12

For Appellant: Shri Jaiprakash BairagraFor Respondent: Shri Ajay Kumar Keshari
Section 132Section 133(6)Section 133ASection 142(1)Section 143(3)Section 147Section 148Section 151(1)

against share capital is not substantiated then even share capital cannot be treated as income u/s 68 unless the Company has introduced its own undisclosed income as share capital. However, Sec 56(2)(viib) presumes even a capital receipt as income but that is applicable w.e.f

Sangeeta Godha, Bhopal, Madhya Pradesh vs. ITO-2(3), Bhopal, Income Tax

In the result appeal of the assessee is allowed

ITA 238/IND/2024[2016-17]Status: DisposedITAT Indore05 Aug 2024AY 2016-17

Bench: Shri Manish Boradsangeeta Godha, Ito 2(3), E-3/18-19, Bhopal Arera Colony, Vs. Bhopal

Section 10Section 143(2)Section 143(3)Section 234ASection 234BSection 56

आयकर अपील"य अ"धकरण, इंदौर "यायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE SMC BENCH, INDORE BEFORE SHRI

Assistant Commissioner of Income Tax, Central Circle, Kota vs. Nisha Jain, Kota

In the result, the appeal of the Revenue is dismissed with no orders as to cost

ITA 378/JPR/2024[2017-18]Status: DisposedITAT Jaipur05 Aug 2024AY 2017-18
For Appellant: Shri Mahendra Gargieya AdvFor Respondent: Shri A.S. Nehra, Addl. CIT-DR fu/kZkfjrh dh vksj ls@
Section 131

reproduced hereinbelow : “Instances have come to the notice of the Board where assessee have claimed that they have been forced to confess the undisclosed income during the course of the search & seizure and survey operations. Such confessions, if not based upon credible evidence, are later retracted by 4 ACIT, CENTRAL ... Similarly, while recording statement during the course of search & seizures and survey operations no attempt should be made to obtain confession as to the undisclosed income. Any action on the contrary shall be viewed adversely. Further, in respect of pending assessment proceedings also, assessing officers should rely upon the evidences/materials

Assistant Commissioner of Income Tax, Central Circle, Kota vs. Nisha Jain, Kota

In the result, the appeal of the Revenue is dismissed with no orders as to cost

ITA 377/JPR/2024[2015-16]Status: DisposedITAT Jaipur05 Aug 2024AY 2015-16

Bench: SHRI SANDEEP GOSAIN (Judicial Member), DR MITHA LAL MEENA (Accountant Member)

For Appellant: Shri Mahendra Gargieya AdvFor Respondent: Shri A.S. Nehra, Addl. CIT-DR fu/kZkfjrh dh vksj ls@
Section 131Section 131(1)Section 133A

appreciating the in other important fact that during the assessment proceedings of the assessee for AY 2016- 17 the assess had clamed/accepted that the undisclosed income 3 ACIT, CENTRAL CIRCLE, KOTA VS NISHA JAIN, KOTA offered during survey at Rs. 1,71,72,858/- was related ... practice, being followed in the accounting world. The increase in the expenditure, when compared with such rough notings, does not ipso facto result in undisclosed income for the reason that, only the finally prepared annual accounts, which are based for computing total income and is relied upon by the assessee

Assistant Commissioner of Income Tax, Central Circle, Kota vs. Naresh Jain, Kota

ITA 374/JPR/2024[2017-18]Status: DisposedITAT Jaipur05 Aug 2024AY 2017-18
For Appellant: Shri Mahendra Gargieya AdvFor Respondent: Shri A.S. Nehra, Addl. CIT-DR
Section 131Section 133ASection 133A(3)(iii)

reproduced herein below : “Instances have come to the notice of the Board where assessee have claimed that they have been forced to confess the undisclosed income during the course of the search & seizure and survey operations. Such confessions, if not based upon credible evidence, are later retracted by the concerned ... Similarly, while recording statement during the course of search & seizures and survey operations no attempt should be made to obtain confession as to the undisclosed income. Any action on the contrary shall be viewed adversely. Further, in respect of pending assessment proceedings also, assessing officers should rely upon the evidences/materials

Smt. Permila Devi Yadav, Alwar vs. ITO, Ward-Behror, Alwar

In the result, the appeal of the assessee is allowed

ITA 345/JPR/2024[2010-11]Status: DisposedITAT Jaipur02 Aug 2024AY 2010-11

Bench: SHRI SANDEEP GOSAIN (Judicial Member)

For Appellant: Shri P.C. Parwal, CAFor Respondent: Mrs. Monisha Choudhary, Addl. CIT-DR

cash withdrawals from the bank was available with the assessee which was subsequently deposited with the bank therefore the same cannot be treated as undisclosed income of the 4 SMT. PERMILA DEVI YADAV VS ITO, WARD – BEHROR, ALWAR assessee on this preposition. I also relay upon the decision ... assessee. But the assessee failed to substantiate his claim for the source of such cash deposit. Therefore, the same was treated as undisclosed income and added to the total income of the assessee. The CIT(A) subsequently confirmed the view taken by the AO. CIT(A) rejected the contention

Sheetal Collection, Jalgaon vs. DCIT, Circle-2, Jalgaon

ITA 1074/PUN/2024[2014-15]Status: DisposedITAT Pune01 Aug 2024AY 2014-15

Bench: Hon’Ble Shri G. D. Padmahshali & Shri Vinay Bhamoreassessment Year : 2014-15 M/S Sheetal Collection Shop No. 16, Fule Market, Jalgaon-425001 Pan: Acifs1530K. . . . . . . . Appellant V/S Dy. Commissioner Of Income Tax, Circle-2, Jalgaon. . . . . . . . Respondent Appearances Assessee By : Mr V V Kawdia [‘Ld. Ar’] Revenue By : Mr Umashankar Prasad [‘Ld. Dr’] Date Of Conclusive Hearing : 25/07/2024 Date Of Pronouncement : 01/08/2024 Order Per G. D. Padmahshali, Am; Against Din & Order No. Itba/Apl/S/250/2023-24/1063185555(1) Dt. 22/03/2024 Passed U/S 250 Of The Income-Tax Act, 1961 [‘The Act’ Hereinafter] Passed By The Commissioner Of Income Tax Appeal-11 Pune [‘Cit(A)’ Hereinafter] Which In Turn Arisen Out Of Order Of Assessment Passed U/S 143(3) Of The Act By The Dy. Commissioner Of Income Tax, Circle-2, Jalgaon [‘Ao’ Hereinafter] Anent To Assessment Year 2014-15 [‘Ay’ Hereinafter] The Assessee Is In Appeal. 2. Tersely Stated The Facts Of The Case Are That; 2.1 The Assessee Is A Partnership Firm & Engaged In Retail Trading Business Of Readymade Garments. During The Year Under Consideration A Survey Action U/S 133A Of The Act On The Assessee Firm Was Carried Out & A Statement Of Its Partner Was Recorded. In Answering To Question Number 16 The Partner Declared/Admitted Certain

For Appellant: Mr V V Kawdia [‘Ld. AR’]For Respondent: Mr Umashankar Prasad [‘Ld. DR’]
Section 132(4)Section 133ASection 139(1)Section 143(2)Section 143(3)Section 250

question number 16 the partner declared/admitted certain ITAT-Pune Page 1 of 4 M/s Sheetal Collection Vs DCIT ITA No. 1074/PUN/2024 AY 2014-15 undisclosed income in relation to firm’s business activities viz; (a) excess cash ₹7,51,313/- (b) unpaid sundry creditors ₹2,32,087/- (c) excess stock

Prakash Chand Saini, Sikandra vs. PCIT(Central)Jaipur, Jaipur

ITA 479/JPR/2024[2019-20]Status: DisposedITAT Jaipur01 Aug 2024AY 2019-20
For Appellant: Sh. S. L. Poddar, AdvFor Respondent: Sh. Shailendra Sharma, CIT-DR
Section 133ASection 139Section 143(2)Section 143(3)Section 263

valuation of construction of showroom done during survey, various discrepancies were detected during the course of survey proceedings resulting into the surrender of undisclosed income by the assessee. In view of that, after considering all the material facts a lumpsum addition of Rs. 7,00,000/- is being made ... 115BBE of the Act. Thus, Ld. PCIT held that the assessment was framed u/s 143(3) of the Act without verification with respect to undisclosed income offered by the assessee, covered by the provisions of section 69 & 69A r.w.s. 115BBE of the Act, and as such erroneous and causing prejudice

Laxmi Narayan Saini, Sikandra vs. PCIT(Central), Jaipur

ITA 478/JPR/2024[2019-20]Status: DisposedITAT Jaipur01 Aug 2024AY 2019-20
For Appellant: Sh. S. L. Poddar, AdvFor Respondent: Sh. Shailendra Sharma, CIT-DR
Section 133ASection 139Section 143(2)Section 143(3)Section 263

valuation of construction of showroom done during survey, various discrepancies were detected during the course of survey proceedings resulting into the surrender of undisclosed income by the assessee. In view of that, after considering all the material facts a lumpsum addition of Rs. 7,00,000/- is being made ... 115BBE of the Act. Thus, Ld. PCIT held that the assessment was framed u/s 143(3) of the Act without verification with respect to undisclosed income offered by the assessee, covered by the provisions of section 69 & 69A r.w.s. 115BBE of the Act, and as such erroneous and causing prejudice

Mukesh Kumar Saini, Sikandara vs. PCIT(Central), Jaipur

In the result, the appeal of the assessee is in ITA no

ITA 477/JPR/2024[2019-20]Status: DisposedITAT Jaipur01 Aug 2024AY 2019-20

Bench: or at the time of hearing.” 5. It is seen that the only grievance raised by the assessee is that PCIT erred in holding the order of the assessment as erroneous in so far as prejudicial to the interest of the revenue. Brief facts related to the issue are culled out are that in this case a Survey action u/s 133A of the Act was carried out on 26.02.2019 at the business premises of the assessee firm M/s Nirankar Tiles and Sanitory 4

For Appellant: Sh. S. L. Poddar, AdvFor Respondent: Sh. Shailendra Sharma, CIT-DR
Section 133ASection 139Section 143(2)Section 143(3)Section 263

valuation of construction of showroom done during survey, various discrepancies were detected during the course of survey proceedings resulting into the surrender of undisclosed income by the assessee. In view of that, after considering all the material facts a lumpsum addition of Rs. 7,00,000/- is being made ... 115BBE of the Act. Thus, Ld. PCIT held that the assessment was framed u/s 143(3) of the Act without verification with respect to undisclosed income offered by the assessee, covered by the provisions of section 69 & 69A r.w.s. 115BBE of the Act, and as such erroneous and causing prejudice

M/S Shivam Resorts, Abohar vs. DCIT, CC-1, Ludhiana

In the result, the appeal of the Assessee is allowed

ITA 427/CHANDI/2023[2018-19]Status: DisposedITAT Chandigarh31 Jul 2024AY 2018-19

Bench: Shri Krinwant Sahay & Shri Paresh M. Joshiआयकर अपील सं./ Ita No. 427/Chd/2023 "नधा"रण वष" / Assessment Year: 2018-19 M/S Shivam Resorts, Vs. The Dcit, Central Circle -1, Malout, Hamunangarh Road, बनाम Ludhiana Bye Pass, Abohar "थायी लेखा सं./Pan No: Accfs7094Q अपीलाथ"/ Appellant ""यथ"/ Repsondent ( Hybrid Hearing ) "नधा"रती क" ओर से/Assessee By : Shri Ashwani Kumar,Ca राज"व क" ओर से/ Revenue By : Shri Rahus Sohu, Jcit, Sr. Dr सुनवाई क" तार"ख/Date Of Hearing : 01.07.2024 उदघोषणा क" तार"ख/Date Of Pronouncement : 31.07.2024

For Appellant: Shri Ashwani Kumar,CAFor Respondent: Shri Rahus Sohu, JCIT, Sr. DR
Section 133ASection 143(2)Section 250(6)

material available during the course of the search should 427-Chd-2023 M/s Shivam Resorts, Abohar 13 be the basis for computing the undisclosed income. There cannot be any presumption part of the Ld. Assessing Officer with respect to the extrapolation of undisclosed income. Moreover, there is no indication that ... 733/101 Taxman 525 wherein it was held that the evidence found and the material available should be the basis for computing the undisclosed income. It was observed by the Bench that to hold that even without any evidence or material the Assessing Officer would be 427-Chd-2023 M/s Shivam

Chhaya Vikas Shah Legal Heir & Wife of Late Vikas Shah, Ahmedabad vs. The Dy.CIT, Central Circle-2(2), Ahmedabad

In the result, all three appeals of the Assessee are dismissed

ITA 584/AHD/2023[1999-2000]Status: DisposedITAT Ahmedabad31 Jul 2024AY 1999-2000

Bench: Shri Siddhartha Nautiyal & Shri Makarand V. Mahadeokarsl. आयकर अपील सं/ "नधा"रण वष"/ Appeal(S) By : No(S)

For Appellant: Shri Suresh Gandhi, ARFor Respondent: Shri Ashok Kumar Suthar, Sr.DR
Section 132(2)Section 153ASection 271(1)(b)Section 271(1)(c)

clearly enumerated in Page 7 para 10 (supra) leading to conclusion that the penalty is imposed on both the limbs on the entire undisclosed income of Rs. 28,93,042/-. ITA Nos.584, 585 and 586/Ahd/2023 Chhaya Vikas Shah Legal Heir & Wife of Late Vikas Shah vs. Dy.CIT Asst. Years ... direction of the Hon'ble ITAT, Ahmedabad, additional details were filed and during proceeding with ITAT different type of transactions were noted and undisclosed income was determined (as detailed in the table above). - the argument by the assessee is curious as on one hand he hides information to purposely evade

Arvindkumar Amulkh Tanna, Ahmedabad vs. The ACIT, Central Circle-2 (3), Ahmeadabad

ITA 577/AHD/2020[2015-16]Status: DisposedITAT Ahmedabad31 Jul 2024AY 2015-16

Bench: Shri Siddhartha Nautiyal & Shri Makarand V. Mahadeokar

Section 132Section 143(1)Section 143(3)Section 153A

facts and in the circumstances of the case and in law, the Id. CIT(A) has erred in not appreciating that while computation of undisclosed income of the block period u/s. 158BB was to be made on the basis of evidence found as a result of search or requisition ... facts and in the circumstances of the case and in law, the Id. CIT(A) has erred in not appreciating that while computation of undisclosed income of the block period u/s.158BB was to be made on the basis of evidence found as a result of search or requisition of books

Shri Ashokji Chanduji Thakor, Ahmedabad vs. The ITO, Ward-3(3)(1), Ahmedabad

ITA 218/AHD/2020[2011-12]Status: DisposedITAT Ahmedabad31 Jul 2024AY 2011-12

Bench: Shri Siddhartha Nautiyal & Shri Narendra Prasad Sinha

While making the additions, the ITAT made the following observations: “8. The scheme of Section, which governs penalty on undisclosed income for the 'specified previous year', is like this. In the cases in which search is initiated, the penalty under section 271AAA will come into play in respect of 'undisclosed ... that extent, the provisions of Section 271(1)(c) will not be applicable. In other words, so far as penalty in respect of undisclosed income is concerned, Section 271AAA will apply to the extent of the 'specified previous year' and, for the other previous years, the provisions of Section

Shri Ashokji Chanduji Thakor, Ahmedabad vs. The ITO, Ward-3(3)(1), Ahmedabad

ITA 217/AHD/2020[2011-12]Status: DisposedITAT Ahmedabad31 Jul 2024AY 2011-12

Bench: Shri Siddhartha Nautiyal & Shri Narendra Prasad Sinha

While making the additions, the ITAT made the following observations: “8. The scheme of Section, which governs penalty on undisclosed income for the 'specified previous year', is like this. In the cases in which search is initiated, the penalty under section 271AAA will come into play in respect of 'undisclosed ... that extent, the provisions of Section 271(1)(c) will not be applicable. In other words, so far as penalty in respect of undisclosed income is concerned, Section 271AAA will apply to the extent of the 'specified previous year' and, for the other previous years, the provisions of Section

Shri Ashokji Chanduji Thakor, Ahmedabad vs. The ITO, Ward-3(3)(1), Ahmedabad

ITA 216/AHD/2020[2010-11]Status: DisposedITAT Ahmedabad31 Jul 2024AY 2010-11

Bench: Shri Siddhartha Nautiyal & Shri Narendra Prasad Sinha

While making the additions, the ITAT made the following observations: “8. The scheme of Section, which governs penalty on undisclosed income for the 'specified previous year', is like this. In the cases in which search is initiated, the penalty under section 271AAA will come into play in respect of 'undisclosed ... that extent, the provisions of Section 271(1)(c) will not be applicable. In other words, so far as penalty in respect of undisclosed income is concerned, Section 271AAA will apply to the extent of the 'specified previous year' and, for the other previous years, the provisions of Section

Shri Ashokji Chanduji Thakor, Ahmedabad vs. The ITO, Ward-3(3)(1), Ahmedabad

ITA 215/AHD/2020[2009-10]Status: DisposedITAT Ahmedabad31 Jul 2024AY 2009-10

Bench: Shri Siddhartha Nautiyal & Shri Narendra Prasad Sinha

While making the additions, the ITAT made the following observations: “8. The scheme of Section, which governs penalty on undisclosed income for the 'specified previous year', is like this. In the cases in which search is initiated, the penalty under section 271AAA will come into play in respect of 'undisclosed ... that extent, the provisions of Section 271(1)(c) will not be applicable. In other words, so far as penalty in respect of undisclosed income is concerned, Section 271AAA will apply to the extent of the 'specified previous year' and, for the other previous years, the provisions of Section