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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

Shri Kannan Kashi Vishwanathan, Mumbai vs. Dy CIT CC-5(2), Mumbai

In the result, the appeals of the assessee for assess

ITA 4386/MUM/2018[2013-14]Status: DisposedITAT Mumbai31 May 2023AY 2013-14

Bench: Shri Om Prakash Kant () & Shri Rahul Chaudhary ()

For Appellant: Mr. Nilesh JoshiFor Respondent: Mr. Neehar Ranjan Pandey, CIT-DR
Section 132(1)Section 153A

income of the assessee including the compute the total income of the assessee including the compute the total income of the assessee including the undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed returns before the date

Shri Kannan Kashi Vishwanathan, Mumbai vs. Dy CIT CC-5(2), Mumbai

In the result, the appeals of the assessee for assess

ITA 4385/MUM/2018[2012-13]Status: DisposedITAT Mumbai31 May 2023AY 2012-13

Bench: Shri Om Prakash Kant () & Shri Rahul Chaudhary ()

For Appellant: Mr. Nilesh JoshiFor Respondent: Mr. Neehar Ranjan Pandey, CIT-DR
Section 132(1)Section 153A

income of the assessee including the compute the total income of the assessee including the compute the total income of the assessee including the undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed returns before the date

Shri Kannan Kashi Vishwanathan, Mumbai vs. Dy CIT CC-5(2), Mumbai

In the result, the appeals of the assessee for assess

ITA 4384/MUM/2018[2011-12]Status: DisposedITAT Mumbai31 May 2023AY 2011-12

Bench: Shri Om Prakash Kant () & Shri Rahul Chaudhary ()

For Appellant: Mr. Nilesh JoshiFor Respondent: Mr. Neehar Ranjan Pandey, CIT-DR
Section 132(1)Section 153A

income of the assessee including the compute the total income of the assessee including the compute the total income of the assessee including the undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed returns before the date

Shri Kannan Kashi Vishwanathan, Mumbai vs. Dy CIT CC-5(2), Mumbai

In the result, the appeals of the assessee for assess

ITA 4383/MUM/2018[2010-11]Status: DisposedITAT Mumbai31 May 2023AY 2010-11

Bench: Shri Om Prakash Kant () & Shri Rahul Chaudhary ()

For Appellant: Mr. Nilesh JoshiFor Respondent: Mr. Neehar Ranjan Pandey, CIT-DR
Section 132(1)Section 153A

income of the assessee including the compute the total income of the assessee including the compute the total income of the assessee including the undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed returns before the date

Shri Kannan Kashi Vishwanathan, Mumbai vs. Dy CIT CC-5(2), Mumbai

In the result, the appeals of the assessee for assess

ITA 4382/MUM/2018[2009-10]Status: DisposedITAT Mumbai31 May 2023AY 2009-10

Bench: Shri Om Prakash Kant () & Shri Rahul Chaudhary ()

For Appellant: Mr. Nilesh JoshiFor Respondent: Mr. Neehar Ranjan Pandey, CIT-DR
Section 132(1)Section 153A

income of the assessee including the compute the total income of the assessee including the compute the total income of the assessee including the undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed returns before the date

Shri Kannan Kashi Vishwanathan, Mumbai vs. Dy CIT CC-5(2), Mumbai

In the result, the appeals of the assessee for assess

ITA 4381/MUM/2018[2008-09]Status: DisposedITAT Mumbai31 May 2023AY 2008-09

Bench: Shri Om Prakash Kant () & Shri Rahul Chaudhary ()

For Appellant: Mr. Nilesh JoshiFor Respondent: Mr. Neehar Ranjan Pandey, CIT-DR
Section 132(1)Section 153A

income of the assessee including the compute the total income of the assessee including the compute the total income of the assessee including the undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed undisclosed income notwithstanding that the assessee filed returns before the date

Rajeshwar Prasad(HUF), Patna vs. ACIT, Central Circle-1, Patna

In the result, both the appeals of the assessee are treated as allowed for statistical purposes

ITA 6/PAT/2022[2005-06]Status: DisposedITAT Patna31 May 2023AY 2005-06

Bench: Shri Rajpal Yadav, Vice- & Dr. Manish Borad

Section 153ASection 153CSection 234ASection 250

Appeal)-III in confirming the addition made by the Ld. Assessing Officer in treating the agricultural income of Rs. 46,852/- as undisclosed income of the questioned assessment year is bad in law and void-ab-initio and therefore deserves to be quashed. (6) For that the CIT (Appeal

Rajeshwar Prasad(HUF), Patna vs. ACIT, Central Circle-1, Patna

In the result, both the appeals of the assessee are treated as allowed for statistical purposes

ITA 5/PAT/2022[2004-05]Status: DisposedITAT Patna31 May 2023AY 2004-05

Bench: Shri Rajpal Yadav, Vice- & Dr. Manish Borad

Section 153ASection 153CSection 234ASection 250

Appeal)-III in confirming the addition made by the Ld. Assessing Officer in treating the agricultural income of Rs. 46,852/- as undisclosed income of the questioned assessment year is bad in law and void-ab-initio and therefore deserves to be quashed. (6) For that the CIT (Appeal

Sanjay Kumar Bejwani, New Delhi vs. ITO, Ward-61(1), New Delhi

Appeal of the assessee stands allowed accordingly

ITA 2741/DEL/2022[2018-19]Status: DisposedITAT Delhi31 May 2023AY 2018-19

Bench: Shri Kul Bharatassessment Year: 2018-19

Section 143(3)Section 234BSection 28Section 37(1)Section 44A

assessed u/s 143(3) as under: Income returned under the head Business or Rs. 9,23,455/- profession Add: Undisclosed income as discussed above. 13,27,995/- 5 Total Income assessed under the head Business or Profession. 4. Aggrieved against it the assessee preferred appeal before the learned CIT(Appeals

ITO, New Delhi vs. M/S. Central Plastics Pvt. Ltd., Delhi

In the result, the appeal of the Revenue in ITA No

ITA 65/DEL/2017[2012-13]Status: DisposedITAT Delhi31 May 2023AY 2012-13

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Shri Gaurav Kabra, CAFor Respondent: Shri Shankar Lal Verma, Sr. DR
Section 133(6)Section 68

fails to unearth any wrong or illegal dealings, he cannot obdurately adhere to his suspicions and treat the subscribed capital as the undisclosed income of the Company." XXX XXX 15. At this stage, we would like to refer to the judgment of the Bombay High Court in the case

ACIT(Central)-2, Indore vs. Shri Aakash Shukla, Indore

In the result, appeal of revenue is dismissed

ITA 43/IND/2022[2013-14]Status: DisposedITAT Indore31 May 2023AY 2013-14

Bench: Shri Vijay Pal Rao & Shri B.M. Biyaniacit(Central)-1 Shri Aakash Shukla Indore 94, Banganga Main Road Vs. Indore

Section 131Section 132(1)Section 148Section 68

material to show that Page 4 of 14 Aakash Shukla Page 5 of 14 these loans transactions are nothing but assessee’s own undisclosed income routing back through these loan creditors in the garb of unsecured loans. The Ld. CIT(A) has decided this issue in para

Pravina Navin Dedhia, Mumbai vs. CIT (A) NFAC, Mumbai

In the result the appeal of the assessee is allowed

ITA 1701/MUM/2021[2012-13]Status: DisposedITAT Mumbai30 May 2023AY 2012-13
For Appellant: Shri Maulik ChoksiFor Respondent: Shri Anil Gupta
Section 147Section 68Section 69C

assessee through show cause notice about the proposed action of treating the share of M/s. PFL as penny-stock and LTCG claim as undisclosed income and also to disallow commission of 2% on sale of shares i.e. Rs.49,358/- to obtain the same. According to the AO, even though ... value of the shares is high does not justify the transactions being treated as fictitious and the capital gains being assessed as undisclosed income if (a) the shares are traded on the Stock Exchange, (b) the payments and receipts are routed through the bank, (c) there is no evidence

Dy/Asst. Commissioner of Income Tax, CC-2, Surat vs. M/S. Patel Madhavlal Maganlal & Co., Surat

In the result, all the appeal of the revenue is dismissed and the appeal of the assessee is partly allowed

ITA 202/SRT/2022[2020-21]Status: DisposedITAT Surat30 May 2023AY 2020-21

Bench: Shri Pawan Singh & Dr. Arjun Lal Sainiit(Ss)A No. 48 & 50/Srt/2022 (Ay: 2018-19 & 2019-20) (Hearing In Physical Court) Assistant Commissioner M/S Patel Madhavlal Maganlal & Co., Of Income Tax, 3/139, Parsi Sheri Navapura, Vs. Central Circle-2, Surat-395003. Surat. Pan: Aadfp 2740 F Appellant Respondednt

Section 127Section 131Section 132Section 153ASection 254(1)Section 68

assessee and perusal of cash book held that cash found from the Varachha Branch, Surat and Alkapuri Branch (Baroda) was offered to tax as undisclosed income, hence such addition was deleted. 45. So far as the cash found at Lahripura (Baroda) and Surat Branch, the Assessing Officer was directed

M/S. Patel Madhavlal Maganlal & Co., Surat vs. The DCIT, Central Circle-2, Surat

In the result, all the appeal of the revenue is dismissed and the appeal of the assessee is partly allowed

ITA 184/SRT/2022[2020-21]Status: DisposedITAT Surat30 May 2023AY 2020-21

Bench: Shri Pawan Singh & Dr. Arjun Lal Sainiit(Ss)A No. 48 & 50/Srt/2022 (Ay: 2018-19 & 2019-20) (Hearing In Physical Court) Assistant Commissioner M/S Patel Madhavlal Maganlal & Co., Of Income Tax, 3/139, Parsi Sheri Navapura, Vs. Central Circle-2, Surat-395003. Surat. Pan: Aadfp 2740 F Appellant Respondednt

Section 127Section 131Section 132Section 153ASection 254(1)Section 68

assessee and perusal of cash book held that cash found from the Varachha Branch, Surat and Alkapuri Branch (Baroda) was offered to tax as undisclosed income, hence such addition was deleted. 45. So far as the cash found at Lahripura (Baroda) and Surat Branch, the Assessing Officer was directed

DCIT, Circle-2(1)(1), Mumbai vs. M/S Kundan Jewellers Pvt Ltd, Mumbai

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

ITA 1035/MUM/2022[2017-18]Status: DisposedITAT Mumbai29 May 2023AY 2017-18

Bench: Shri Prashant Maharishi & Shri Pavan Kumar Gadaledcit, Circle – 2(1)(1) Vs. M/S. Kundan Jewellers Room No. 561, 5Th Floor Pvt Ltd Aayakar Bhavan, Mk 223, Sm Patil Bldg, Sv Road, Mumbai – 400 020 Road, Andheri (W), Mumbai – 400058. Pan/Gir No. : Aabck5770H Appellant .. Respondent Appellant By : Mr.Nihar Ranjan Samal.Dr Respondent By : Mr.Siddharth Kothari.Ar Date Of Hearing 19.05.2023 Date Of Pronouncement 29 .05.2023 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Revenue Has Filed The Appeal Against The Order Of The National Faceless Appeal Centre (Nfac)/Cit(A), Delhi Passed U/S 143(3) & 250 Of The Act. The Revenue Has Raised The Following Grounds Of Appeal:

For Appellant: Mr.Nihar Ranjan Samal.DRFor Respondent: Mr.Siddharth Kothari.AR
Section 115JSection 142(1)Section 143(1)Section 143(2)Section 143(3)Section 68

assessee in its return. It is in these circumstances that the Tribunal observed that the cash sales could not be treated as undisclosed income and no addition could be made once again in respect of the same. The findings of the Commissioner of Income-tax (Appeals) and the Tribunal, which ... gathered that no such entity M/s Sandeep Wire Industries existed hence sale was not accepted as genuine and the said amount was treated as undisclosed income. On appeal before CIT(A) it was demonstrated that even if the said sale was treated as undisclosed income there

Arun Bansal, Delhi vs. ACIT Central Circle 20, Delhi

In the result, appeal is allowed

ITA 2615/DEL/2022[2019-20]Status: DisposedITAT Delhi29 May 2023AY 2019-20

Bench: Shri G.S. Pannu & Shri Saktijit Deyassessment Year: 2019-20 Arun Bansal, 77, Shivam Versus Acit, Central Circle-20, Apartment, Sector-15, Rohini, Delhi. Delhi. Pan: Aagpb3126N (Appellant) (Respondent)

For Appellant: Sh. Somil Aggarwal, Advocate &For Respondent: Ms. Sapna Bhatia, CIT-DR
Section 132Section 132BSection 234B

liability created on 1st April once the financial year ends. Therefore, the Assessing Officer should have 6 adjusted the tax liability relating to the undisclosed income declared by the assessee by way of self assessment tax on 1st April, 2019. In that eventuality, there could not have been levy

DCIT, Central Circle -15, New Delhi vs. B.L. Kashyap & Sons Ltd, New Delhi

ITA 2405/DEL/2022[2017-18]Status: DisposedITAT Delhi29 May 2023AY 2017-18

Bench: Sh. N.K.Billaiya & Sh.Anubhav Sharma

Section 143(3)Section 234DSection 68

wages, spares and power & fuels was made alleging that the same is not forming part of Work in Progress (WIP) resulting in adjustment as undisclosed income of the assessee. In appeal the Ld. CIT(A) had deleted the additions on account of mobilization advance and disallowance of salary and wages ... recognized as liability by the assessee. However, the Ld. AO was not satisfied and made an addition of 20% of the Mobilization, advances as undisclosed income u/s 68 r.w.s. 155BBE of the Act. 5. Ld. CIT(A) after analyzing all the material placed on record before the AO deleted

DCIT, Central Circle-15, New Delhi vs. B.L. Kashyap & Sons Ltd, New Delhi

ITA 2404/DEL/2022[2016-17]Status: DisposedITAT Delhi29 May 2023AY 2016-17

Bench: Sh. N.K.Billaiya & Sh.Anubhav Sharma

Section 143(3)Section 234DSection 68

wages, spares and power & fuels was made alleging that the same is not forming part of Work in Progress (WIP) resulting in adjustment as undisclosed income of the assessee. In appeal the Ld. CIT(A) had deleted the additions on account of mobilization advance and disallowance of salary and wages ... recognized as liability by the assessee. However, the Ld. AO was not satisfied and made an addition of 20% of the Mobilization, advances as undisclosed income u/s 68 r.w.s. 155BBE of the Act. 5. Ld. CIT(A) after analyzing all the material placed on record before the AO deleted

Arjun Bery, New Delhi vs. ACIT, Circle- 24(1), New Delhi

In the result, appeal of the assessee is dismissed

ITA 7240/DEL/2018[2011-12]Status: DisposedITAT Delhi29 May 2023AY 2011-12

Bench: Shri Narendra Kumar Billaiya & Shri Challa Nagendra Prasadआ.अ.सं/.I.T.A No.7240/Del/2018 िनधा"रणवष"/Assessment Year:2011-12 बनाम Arjun Bery Acit Vs. B-443, New Friends Colony, Circle 24(1) New Delhi. New Delhi. Pan No. Aenpb2697D अपीलाथ" Appellant ""यथ"/Respondent

Section 143(3)Section 68

cash via sales which are nothing but bogus. Therefore, the AO treated Rs.19,11,372/- being the sales made from 02.04.2010 till 06.04.2010 as undisclosed income of the assessee u/s 68 of the Act as the sales were made in the month of April 2010 without there being any opening

Jt CIT(OSD)-Central Circle-1(4), Mumbai vs. Vainavin Realty Pvt Ltd, Mumbai

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

ITA 878/MUM/2022[2014-15]Status: DisposedITAT Mumbai26 May 2023AY 2014-15

Bench: Us The Ld Counsel For The Assessee Submitted That This Issue Is Covered By Series Of Decision In The Group Case Of The Assessee & In Support, Decision Of Itat In The Case Of Jcit(Osd) Vs. Nabendu Engineering Pvt. Ltd Ita No. 875/Mum/2022 Dated 12.12.2022 Wherein, Exactly Similar Grounds Were Raised Except In Variations In Figures Of Share Application Money. In This Case Also The Assessee Has Filed Application Under Rule 27 Of The Income Tax (Appellate Tribunal) Rules, 1963 Raising Legal Issue Contending That Before The Ld Cit (A) The Assessee Has Raised These Legal Grounds That The Addition Made By The Ao Are Not Based On Any Incriminating Material Or Evidence Found During The Course Of Search Relating To The Additions Made By The Ao & Is Beyond The Scope Of Section 153C Of The Act. The Said Grounds Read As Under:-

Section 132(1)Section 139Section 143(3)Section 153CSection 153C(1)Section 68

relation with the satisfaction note or material referred therein. Thus, the entire addition is without any incriminating material suggesting any undisclosed income. 7. Ld. CIT (A) has held that even though the statements recorded during the course of search in the other group entities which though have been retracted will ... document belonged to another person other than the searched person. At this juncture the AO is not required to ascertain whether the documents reflect undisclosed income. The documents are then transferred to the jurisdictional AO who will record reasons before proceeding under Sec 153C. The Hon'ble court followed