“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

M/S. South Asian Hospitality Services (P) Ltd., New Delhi vs. DCIT, New Delhi

In the result, both the appeals of the assessee are allowed

ITA 5966/DEL/2015[2005-06]Status: DisposedITAT Delhi26 Jul 2024AY 2005-06

Bench: Shri G. S. Pannu & Ms. Madhumita Roy

For Appellant: Shri V.K. Aggarwal, A.RFor Respondent: Ms. Rishpal Bedi, CIT-D.R

Section 115JSection 132Section 153ASection 153CSection 250(6)

documents as having no certainty have no evidentiary value. Further that, uncorroborated loose papers cannot be taken as a sole basis for determination of undisclosed income. On this issue, the Learned Counsel appearing for the assessee relied upon the judgment passed by the Co- ordinate Bench in the case

Anish Rajnikant Shah, Ahmedabad, Gujarat vs. Income Tax Officer, Ahmedabad, Gujarat

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

ITA 200/AHD/2024[2011-12]Status: DisposedITAT Ahmedabad25 Jul 2024AY 2011-12

Bench: Shri Ramit Kochar (Accountant Member)

For Appellant: Shri Amit Raj, CAFor Respondent: Shri Sanjay Jain, Sr. D.R

Section 115BSection 139Section 142(1)Section 143(3)Section 147Section 148Section 250Section 44ASection 68

encourage ease of doing business, but no license is granted under the 1961 Act to misuse this presumptive scheme of taxation and camouflage undisclosed income from unexplained sources under the guise of turnover/gross receipt. The assessee has miserably failed to substantiate the nature of business carried

Shri Bhagwanbhai Ranchhodbhai Makwana, Ahmedabad vs. The Income Tax Officer, Ward-5(1)(2), Ahmedabad

Appeal is dismissed

ITA 1076/AHD/2019[2011-12]Status: DisposedITAT Ahmedabad25 Jul 2024AY 2011-12

Bench: Shri Siddhartha Nautiyal (Judicial Member), Shri Makarand V. Mahadeokar (Accountant Member)

For Appellant: Shri Tushar Hemani, Sr. A.R. &For Respondent: Shri Ashok Kumar Suthar, Sr. D.R

Section 234ASection 250Section 271(1)(c)Section 69

supporting documents regarding the source of cash deposits in the bank account, the Assessing Officer added a sum of Rs. 3,64,566/- as undisclosed income u/s. 69 of the Act. 17. In appeal, the assessee submitted that it had submitted details in respect of cash deposited in the above

Late Bhagwatsinh Jibhubhai Chavda)L/H.Bhaktiben Bhagwatsinh Chavda, Ahmedabad vs. ITO, Ward-5(1)(2), Ahmedabad

Appeal is dismissed

ITA 1075/AHD/2019[2011-12]Status: DisposedITAT Ahmedabad25 Jul 2024AY 2011-12

Bench: Shri Siddhartha Nautiyal (Judicial Member), Shri Makarand V. Mahadeokar (Accountant Member)

For Appellant: Shri Tushar Hemani, Sr. A.R. &For Respondent: Shri Ashok Kumar Suthar, Sr. D.R

Section 234ASection 250Section 271(1)(c)Section 69

Bhaktiben Bhagwatsinh Chavda, (L/H of Late Bhagwatsinh J Chavda), Ahmedabad vs. ITO, Ward-14(2), Ahmedabad

Appeal is dismissed

ITA 511/AHD/2018[2011-12]Status: DisposedITAT Ahmedabad25 Jul 2024AY 2011-12

Bench: Shri Siddhartha Nautiyal (Judicial Member), Shri Makarand V. Mahadeokar (Accountant Member)

For Appellant: Shri Tushar Hemani, Sr. A.R. &For Respondent: Shri Ashok Kumar Suthar, Sr. D.R

Section 234ASection 250Section 271(1)(c)Section 69

Shri Bhagwanbhai R. Makwana, Ahmedabad vs. The Income Tax Officer, Ward-14(2), Ahmedabad

Appeal is dismissed

ITA 2281/AHD/2016[2011-12]Status: DisposedITAT Ahmedabad25 Jul 2024AY 2011-12

Bench: Shri Siddhartha Nautiyal (Judicial Member), Shri Makarand V. Mahadeokar (Accountant Member)

For Appellant: Shri Tushar Hemani, Sr. A.R. &For Respondent: Shri Ashok Kumar Suthar, Sr. D.R

Section 234ASection 250Section 271(1)(c)Section 69

Rajendra Kumar Meena, Gangapur vs. ITO Ward-2 Sawamadhopur, Gangapur

In the result, the appeal of the assessee is allowed

ITA 516/JPR/2024[2013-14]Status: DisposedITAT Jaipur25 Jul 2024AY 2013-14

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

For Appellant: Sh. Shrawan Kumar Gupta, AdvFor Respondent: Sh. Rajesh Kumar Meena (Addl. CIT)

Section 143(2)Section 143(3)Section 147Section 148Section 2(14)Section 234A

after getting the approval from JCIT Range Swaimadhopur, to assess amount of Rs. 58,00,000/- deposited cash in his bank account as undisclosed income. Notice issued u/s. 148 of the Act was served upon the assessee. Various notices u/s. 143(2) and 142(1) were issued from time

Syeda Mariam, Bangalore vs. Income-Tax Officer, Ward-3(1)(4), Bengaluru

In the result we accepted the legal issue and held that the assessment order dated 30

ITA 341/BANG/2024[2014-15]Status: DisposedITAT Bangalore25 Jul 2024AY 2014-15

Bench: Shri Waseem Ahmed & Shri Soundararajan K.Syeda Mariam The Income Tax Officer No. 482, 14Th Main Ward - 3(1)(4) Koramangala 3Rd Block Vs. Bmtc Building, 80Ft. Road Bangalore 560034 6Th Block, Koramangala Pan – Aazpm2737P Bengaluru 560095 (Appellant) (Respondent) Assessee By: Shri Zain Ahmed Khan, Ca Revenue By: Shri V. Parithivel, Jcit-Dr Date Of Hearing: 18.06.2024 Date Of Pronouncement: 25.07.2024 O R D E R Per: Soundararajan K.,J.M. This Appeal Filed By The Assessee Challenges The Order Of The Cit(A)-11, Bengaluru Dated 28.12.2023 In Respect Of The Assessment Year (Ay) 2014-15. 2. The Brief Facts Of The Case Are That The Assessee Filed Her Return Of Income On 28.07.2014. Thereafter A Survey U/S. 133A Was Conducted At The Company M/S. Intact Developers P. Ltd., In Which The Assessee Is A Director & Based On The Survey It Was Found That The Assessee Had Lent Unsecured Loans To The Company & In Support Of The Unsecured Loans The Assessee Filed Confirmation Letters From The Company. Insofar As The Source For The Loan, The Assessee Submitted That She Got Capital Gain In Ays 2013-14 & 2014-15 & Out Of This She Offered Loans To The Company. The Ld. Assessing Officer (Ao) Verified The Details Filed By The Assessee & Came To The Conclusion That There

For Appellant: Shri Zain Ahmed Khan, CAFor Respondent: Shri V. Parithivel, JCIT-DR

Section 133ASection 139(1)Section 143(2)Section 144Section 148Section 54Section 548Section 54B

wherein it was held as follows: “ We conclude even for the purpose of Chapter XIV-B of the Act, for the determination of the undisclosed income for block period under the provisions of section 158BC, the provision of section 142 and sub sections (2) and (3) of section

ACIT-2(1)(1), Mumbai vs. Kundan Jewellers, Mumbai

In the result, additional ground raised by the assessee is allowed and appeal filed by the Revenue is dismissed

ITA 4493/MUM/2023[2014-15]Status: DisposedITAT Mumbai25 Jul 2024AY 2014-15

Bench: Us Challenging The Validity Of Reopening U/S.147 On The Following Grounds:- “1.On The Facts & In The Circumstances Of The Case, The Commissioner Of Income-Tax (Appeals) Nfac Has Erred In Not Adjudicating The Ground Of The Assessee Challenging The Validity Of Reassessment, Which Is Time-Barred Considering The Provisions Of The Act. The Assessee Respectfully Submits That The Reassessment Made Is Time Barred & Therefore The Same Deserves To Be Quashed. 2 On The Facts & In The Circumstances Of The Case, The Cit (A) Has Erred In Not Adjudicating The Additional Ground Of Appeal Raised By The Assessee During The Course Of The Appeal Proceedings. The Assessee Respectfully Submits That The Issue Of Statutory Notices /S. 148 Of The Act By The Jurisdictional Assessing Officer Is In Violation Of The Provisions Of Section 151A Of The Act & The Notifications Issued Thereunder. Accordingly The Reassessment In Pursuance Of Such Notices Is Invalid & Deserves To Be Quashed.”

Section 115JSection 139(1)Section 143(1)Section 143(3)Section 147Section 148Section 151Section 151ASection 68

same to its other account and then making payment to Riddhi Siddhi Bullion gives rise to the logical suspicion that the assessee has undisclosed income which it deposited in the bank and thereafter transferring the other account in order to give the colour of sale proceeds. Therefore, the cash deposits ... invoice/cash memo. As the sources of the cash deposited in bank is already explained and therefore it cannot be said that the Assessee fins undisclosed income. Simply with reason that cash deposited in one bank account and thereafter transferred to another bank account of the company from wherein payment

Friends Telecom Pvt. Ltd., Delhi vs. ACIT, Central Circle-2, Delhi

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

ITA 1884/DEL/2024[2015-16]Status: DisposedITAT Delhi25 Jul 2024AY 2015-16

Bench: Shri Shamim Yahyafriends Telecom Pvt. Ltd., Vs. Acit, Pvt. Shop No.4, Ground Floor, Central Circle 2, Plot No.19, Veer Savarkar Block, Delhi. Shakarpur, East Delhi, Delhi – 110 092. (Pan : Aaccf0776H) (Appellant) (Respondent) Assessee By : Shri Pranav Yadav, Advocate Revenue By : Shri Om Prakash, Sr. Dr Date Of Hearing : 23.07.2024 Date Of Order : 25.07.2024 Order This Appeal By The Assessee Is Directed Against The Order Of The Ld. Cit (Appeals)-23, New Delhi Dated 29.09.2023 For The Assessment Year 2015-16. 2. Grounds Of Appeal Taken By The Assessee Read As Under :- “1 On The Facts & Circumstances Of The Case & In Law, The Notice U/S 148 Issued In This Case Is Bad-In- Law, Illegal, Without Jurisdiction & Barred By Limitation And, Therefore, The Said Notice U/S 148 Along With Assessment Order Passed On The Foundation Of Such Notice Are Liable To Be Quashed & Cit(A) Erred In Not Holding So. 2. On The Facts & Circumstances Of The Case & In Law, The Reassessment Proceedings Initiated Are Contrary To The Provisions Of Law Including The Specific Provisions Of Section 147 To Section 151 Of Income Tax Act, 1961 & Therefore, The Reassessment Proceeding Initiated Along With Assessment Order

For Appellant: Shri Pranav Yadav, AdvocateFor Respondent: Shri Om Prakash, Sr. DR

Section 147Section 148Section 151Section 68

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘SMC’ : NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER Friends Telecom Pvt

Gracious Overseas Pvt. Ltd., Delhi vs. ACIT, Central Circle-2, Delhi

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

ITA 1883/DEL/2024[2015-16]Status: DisposedITAT Delhi25 Jul 2024AY 2015-16

Bench: Shri Shamim Yahyagracious Overseas Pvt. Ltd., Vs. Acit, Pvt. Shop No.4, Ground Floor, Central Circle 2, Plot No.19, Veer Savarkar Block, Delhi. Shakarpur, Delhi – 110 092. (Pan : Aaccd5744M) (Appellant) (Respondent) Assessee By : Shri Pranav Yadav, Advocate Revenue By : Shri Om Prakash, Sr. Dr Date Of Hearing : 23.07.2024 Date Of Order : 25.07.2024 Order This Appeal By The Assessee Is Directed Against The Order Of The Ld. Cit (Appeals)-23, New Delhi Dated 29.09.2023 For The Assessment Year 2015-16. 2. Grounds Of Appeal Taken By The Assessee Read As Under :- “1 On The Facts & Circumstances Of The Case & In Law, The Notice U/S 148 Issued In This Case Is Bad-In- Law, Illegal, Without Jurisdiction & Barred By Limitation And, Therefore, The Said Notice U/S 148 Along With Assessment Order Passed On The Foundation Of Such Notice Are Liable To Be Quashed & Cit(A) Erred In Not Holding So. 2. On The Facts & Circumstances Of The Case & In Law, The Reassessment Proceedings Initiated Are Contrary To The Provisions Of Law Including The Specific Provisions Of Section 147 To Section 151 Of Income Tax Act, 1961 & Therefore, The Reassessment Proceeding Initiated Along With Assessment Order

For Appellant: Shri Pranav Yadav, AdvocateFor Respondent: Shri Om Prakash, Sr. DR

Section 147Section 148Section 151Section 68

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘SMC’ : NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER Gracious Overseas Pvt

Gracious Overseas Pvt. Ltd., Delhi vs. ACIT, Central Circle-2, Delhi

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

ITA 1882/DEL/2024[2016-17]Status: DisposedITAT Delhi25 Jul 2024AY 2016-17

Bench: Shri Shamim Yahyagracious Overseas Pvt. Ltd., Vs. Acit, Pvt. Shop No.4, Ground Floor, Central Circle 2, Plot No.19, Veer Savarkar Block, Delhi. Shakarpur, Delhi – 110 092. (Pan : Aaccd5744M) (Appellant) (Respondent) Assessee By : Shri Pranav Yadav, Advocate Revenue By : Shri Om Prakash, Sr. Dr Date Of Hearing : 22.07.2024 Date Of Order : 25.07.2024 Order This Appeal By The Assessee Is Directed Against The Order Of The Ld. Cit (Appeals)-23, New Delhi Dated 29.09.2023 For The Assessment Year 2016-17. 2. Grounds Of Appeal Taken By The Assessee Read As Under :- “1 On The Facts & Circumstances Of The Case & In Law, The Notice U/S 148 Issued In This Case Is Bad-In- Law, Illegal, Without Jurisdiction & Barred By Limitation And, Therefore, The Said Notice U/S 148 Along With Assessment Order Passed On The Foundation Of Such Notice Are Liable To Be Quashed & Cit(A) Erred In Not Holding So. 2. On The Facts & Circumstances Of The Case & In Law, The Reassessment Proceedings Initiated Are Contrary To The Provisions Of Law Including The Specific Provisions Of Section 147 To Section 151 Of Income Tax Act, 1961 & Therefore, The Reassessment Proceeding Initiated Along With Assessment Order

For Appellant: Shri Pranav Yadav, AdvocateFor Respondent: Shri Om Prakash, Sr. DR

Section 147Section 148Section 151Section 68

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘SMC’ : NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER Gracious Overseas Pvt

Neeraj Jain, Delhi vs. DCIT, Central Circle-31, New Delhi

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

ITA 1591/DEL/2023[2019-20]Status: DisposedITAT Delhi25 Jul 2024AY 2019-20

Bench: Shri Pradip Kumar Kedia & Shri Yogesh Kumar Usassessment Year 2019-20

For Respondent: Shri Subhra Jyoti Chakraborty, CIT-DR

Section 131Section 132Section 143(2)Section 143(3)Section 153DSection 3Section 69A

Rs.1,32,61,467/-. While doing so, the AO observed that in the statement recorded before the Investigation Wing, the assessee had admitted undisclosed income of 5 Rs.1,20,00,000/-. The additions made by the AO was confirmed by the CIT(A) on mis-appreciation of facts ... there should be focus and concentration on collection of evidence of income and no attempt should be made to obtain confession as to the undisclosed income. The CBDT has recognized the position that assessment of undisclosed income has to be based upon the evidence and not on statement. Thus statement

ACIT, Ghaziabad vs. M/S. Nazar Trading Pvt. Ltd., New Delhi

ITA 2997/DEL/2012[2009-10]Status: DisposedITAT Delhi25 Jul 2024AY 2009-10

Bench: Sh. Pradip Kumar Kedia & Shri Yogesh Kumar U.S.I.T.A. No. 2992/Del/2012 (A.Y 2003-04) I.T.A. No. 2993/Del/2012 (A.Y 2004-05) I.T.A. No. 2994/Del/2012 (A.Y 2006-07) I.T.A. No. 2995/Del/2012 (A.Y 2007-08) I.T.A. No. 2996/Del/2012 (A.Y 2008-09) I.T.A. No. 2997/Del/2012 (A.Y 2009-10)

For Appellant: None

Section 68

fact that the A.O. was lawfully justified in treating the cash credit found in the Assessee’s books of account to be the undisclosed income of the assessee company, as the explanation offered by the assessee was not found to be satisfactory in the opinion of Assessing Officer. 4. That

Grr Holdings, Hyderabad vs. DCIT., Central Circle-3(3), Hyderabad

In the result, all the three appeals filed by the assessee are allowed

ITA 195/HYD/2024[2017-18]Status: DisposedITAT Hyderabad24 Jul 2024AY 2017-18

Bench: Shri Laliet Kumar & Shri Manjunatha, G.आ.अपी.सं /Ita Nos.164, 194 & 195/Hyd/2024 (िनधा"रण वष"/Assessment Years: 2014-15,2015-16 & 2017-18) Grr Holdings Vs. Dy. C. I. T. Hyderabad Central Circle 3(3) Pan:Aaqfg0867M Hyderabad (Appellant) (Respondent) िनधा""रती "ारा/Assessee By: Shri P. Murali Mohan Rao, Ca राज" व "ारा/Revenue By:: N O N E सुनवाई की तारीख/Date Of Hearing: 27/05/2024 घोषणा की तारीख/Pronouncement: 24/07/2024 आदेश/Order

For Appellant: Shri P. Murali Mohan Rao, CAFor Respondent: : N O N E

Section 132(4)Section 153ASection 263Section 69A

contributed or paid by Shry Syed Fayaz Mohammed. He further stated that he cannot explain the source and accordingly admitted the same as undisclosed income in his individual capacity for the A.Y 2014-15. In respect of balance amount of Rs.5.00 crore contributed by Shry Syed Fayaz Mohd, he stated ... that the entire amount of investment for purchase of property has been contributed by two partners and further they have admitted undisclosed income in their individual capacity for A.Y 2014-15. The learned Counsel for the assessee referring to the provisions of section