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“unexplained cash credit”

Cash Credits & Unexplained ItemsSection 68Section 687,118 judgments

The decision most relied on for unexplained cash credit is Sumati Dayal v. CIT (214 ITR 801), cited in 1,967 judgments on BharatTax.

Leading authorities on unexplained cash credit

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.

CIT v. Orissa Corporation Pvt. Ltd.
159 ITR 78 · 1986 · Supreme Court
897
citing judgments

When an assessee provides the identity and address of a creditor or investor for a cash credit or share capital under Section 68, the burden shifts to the Department to establish lack of genuineness or creditworthiness, requiring it to conduct further inquiries; mere non-compliance by third parties to summons cannot be the sole basis for an adverse inference against the assessee.

(Central)-1 v. NRA Iron & Steel (P) Ltd.
103 Taxmann.com 48 · 2019 · Supreme Court
696
citing judgments

When assessing cash credits, share capital, or loans, the assessee bears the onus to prove the identity, creditworthiness, and genuineness of transactions. This burden is not discharged merely by documentary evidence if field inquiries reveal accommodation entries or dealings with paper/shell companies.

Commissioner of Income Tax v. Nova Promoters and Finlease (P) Ltd.
342 ITR 169 · 2012 · High Court
658
citing judgments

To make an addition under Section 68 for unexplained cash credits, the Assessing Officer must conduct proper inquiry into the identity, genuineness, and creditworthiness of the creditor, especially concerning share application money. The assessee's initial discharge of burden by providing necessary details shifts the onus back to the AO for further investigation, including the source of source.

Kale Khan Mohammad Hanif v. CIT
50 ITR 1 · 1963 · Supreme Court
581
citing judgments

The assessee bears the onus of proving the source and nature of any sum of money or receipt found to have been received by them. If the assessee fails to satisfactorily explain the receipt, the Income-tax Officer is entitled to treat it as taxable income.

Lalchand Bhagat Ambica Ram v. CIT
37 ITR 288 · 1959 · Supreme Court
570
citing judgments

Where an assessee maintains regular books of account, and these books are not rejected or found defective by the Assessing Officer, any cash deposits or available cash shown in the cash book, if sufficient to cover the transaction, cannot be treated as unexplained income or an addition under sections 68 or 69A.

CIT v. Daulat Ram Rawatmull
87 ITR 349 · 1973 · Supreme Court
525
citing judgments

The onus to prove that an apparent transaction or explanation is not real lies with the person who claims it to be so. If an assessee provides a plausible explanation for a transaction, the revenue must establish that the apparent transaction is not genuine.

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.

Judgments citing unexplained cash credit

Dy. Commissioner of Income Tax, Cen-Circle-4(1), Mumbai vs. M/S Evergreen Enterprises, Mumbai

ITA 2141/MUM/2023[2013-2014]Status: DisposedITAT Mumbai27 Sept 2023AY 2013-2014

Bench: Shri Kuldip Singh & Ms. Padmavathy S

For Appellant: Shri Vinod Kumar Bindal, A.R. &For Respondent: Ms. N.V. Nadkarni (CIT DR)
Section 68

facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.631,74,02,800/ made u/s 68 of the Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT ... facts and in the circumstances of the case, the Ld.CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.562,42,94,400/- u/s 68 of Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT(A) is not justified

Dy. Commissioner of Income Tax, Cen-Circle-4(1), Mumbai vs. M/S Evergreen Enterprises, Mumbai

ITA 2140/MUM/2023[2014-2015]Status: DisposedITAT Mumbai27 Sept 2023AY 2014-2015

Bench: Shri Kuldip Singh & Ms. Padmavathy S

For Appellant: Shri Vinod Kumar Bindal, A.R. &For Respondent: Ms. N.V. Nadkarni (CIT DR)
Section 68

facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.631,74,02,800/ made u/s 68 of the Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT ... facts and in the circumstances of the case, the Ld.CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.562,42,94,400/- u/s 68 of Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT(A) is not justified

Dy. Commissioner of Income Tax, Cen-Circle-4(1), Mumbai vs. M/S Evergreen Enterprises, Mumbai

ITA 2139/MUM/2023[2015-16]Status: DisposedITAT Mumbai27 Sept 2023AY 2015-16

Bench: Shri Kuldip Singh & Ms. Padmavathy S

For Appellant: Shri Vinod Kumar Bindal, A.R. &For Respondent: Ms. N.V. Nadkarni (CIT DR)
Section 68

facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.631,74,02,800/ made u/s 68 of the Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT ... facts and in the circumstances of the case, the Ld.CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.562,42,94,400/- u/s 68 of Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT(A) is not justified

Dy. Commissioner of Income Tax, Cen-Circle-4(1), Mumbai vs. M/S Evergreen Enterprises, Mumbai

ITA 2138/MUM/2023[2016-2017]Status: DisposedITAT Mumbai27 Sept 2023AY 2016-2017

Bench: Shri Kuldip Singh & Ms. Padmavathy S

For Appellant: Shri Vinod Kumar Bindal, A.R. &For Respondent: Ms. N.V. Nadkarni (CIT DR)
Section 68

facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.631,74,02,800/ made u/s 68 of the Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT ... facts and in the circumstances of the case, the Ld.CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.562,42,94,400/- u/s 68 of Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT(A) is not justified

Dy. Commissioner of Income Tax, Cen-Circle-4(1), Mumbai vs. M/S Evergreen Enterprises, Mumbai

ITA 2137/MUM/2023[2017-2018]Status: DisposedITAT Mumbai27 Sept 2023AY 2017-2018

Bench: Shri Kuldip Singh & Ms. Padmavathy S

For Appellant: Shri Vinod Kumar Bindal, A.R. &For Respondent: Ms. N.V. Nadkarni (CIT DR)
Section 68

facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.631,74,02,800/ made u/s 68 of the Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT ... facts and in the circumstances of the case, the Ld.CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.562,42,94,400/- u/s 68 of Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT(A) is not justified

Dy. Commissioner of Income Tax, Cen-Circle-4(1), Mumbai vs. M/S Evergreen Enterprises, Mumbai

ITA 2136/MUM/2023[2018-2019]Status: DisposedITAT Mumbai27 Sept 2023AY 2018-2019

Bench: Shri Kuldip Singh & Ms. Padmavathy S

For Appellant: Shri Vinod Kumar Bindal, A.R. &For Respondent: Ms. N.V. Nadkarni (CIT DR)
Section 68

facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.631,74,02,800/ made u/s 68 of the Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT ... facts and in the circumstances of the case, the Ld.CIT(A) erred in deleting the addition of Unexplained Cash Credits of Rs.562,42,94,400/- u/s 68 of Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Ld.CIT(A) is not justified

Suresh M. Bhathija (HUF), Mumbai vs. ITO WD 23(3)(1), Mumbai

In the result, the appeal of the assessee is dismissed

ITA 2561/MUM/2022[2006-07]Status: DisposedITAT Mumbai27 Sept 2023AY 2006-07

Bench: Shri Aby T Varkey & Shri Amarjit Singhbhathija Suresh M (Huf) Vs. Income Tax Officer 120 Dakshinpali, D Monte 23(3)(1), Mumbai Park Road Pali Hill Mumbai 400050 स्थायीलेखासं./जीआइआरसं./Pan/Gir No: Aaahs 8289 M Appellant .. Respondent [ Appellant By : Ms. Rutuja N Pawar& Ms. Sneha More Respondent By : Shri Yogendra T Wakare Date Of Hearing 31.08.2023 Date Of Pronouncement 27.09.2023 आदेश / O R D E R Per Amarjit Singh (Am): The Present Appeal Filed By The Assessee Is Directed Against The Order Passed By The Nfac (Nfac), Delhi, Dated 15.09.2022 For A.Y. 2006-07. The Assessee Has Raised The Following Grounds Before Us: “1. The Learned Cit(Appeals) Was Not Justified In Confirming The Action Of The Learned Assessing Officer In Bringing To Tax An Amount Of Rs. 90,92,165/- As Long Term Capital Gains On Sale Of Land. 2. The Learned Cit(Appeals) & The Learned Assessing Officer Failed To Appreciate That The Said Land Was An Agricultural Land & Was Not A Capital Asset. 3. Without Prejudice To The Above Grounds Of Appeal, The Learned Cit(Appeals) & The Learned Assessing Officer Were Not Justified In Disallowing The Claim For Expenses Of Rs. 69,00,000/- While Computing The Long Term Capital Gains.

For Appellant: Ms. Rutuja N Pawar&For Respondent: Shri Yogendra T Wakare
Section 143(2)Section 50C

cash deposit with relevant supporting P a g e | 6 Suresh M. Bhathija (HUF) vs. ITO evidences, therefore, the same was treated as unexplained cash credit u/s 68 of the Act and added to the total income of the assessee. 3. Aggrieved the assessee filed the appeal before

DCIT-CC 5(2), Mumbai vs. Krishiraj Enterprises, Mumbai

In the result, the appeal by the Revenue is allowed

ITA 1923/MUM/2022[2017-18]Status: DisposedITAT Mumbai27 Sept 2023AY 2017-18

Bench: Shri Amarjit Singh & Shri Sandeep Singh Karhail

For Appellant: Shri Kunal Agarwal a/wFor Respondent: Shri P.D. Chogule
Section 143(3)Section 250Section 68

absence of any cogent explanation and corroborative documentary evidence, the AO treated the cash deposit of Rs.1,63,92,000, as unexplained cash credit under section 68 of the Act and added the same to the total income of the assessee. 7. The learned CIT(A), vide impugned order, deleted ... Enterprises ITA no.1923/Mum./2022 account on 25.11.2016. Accordingly. the addition of Rs. 1,63,92,000/- made by the AO in respect of unexplained cash credit is, therefore, deleted. 5.3.5 As far as the applicability of provisions of Sec. 115BBE of the Act in respect of addition made

M/S.Vibgyor Texotech Private Limited, Mumbai vs. ACIT-8(3)(2), Mumbai

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

ITA 489/MUM/2019[2011-12]Status: DisposedITAT Mumbai27 Sept 2023AY 2011-12

Bench: Shri S. Rifaur Rahman, Am & Ms. Kavitha Rajagopal, Jm

For Appellant: NoneFor Respondent: Shri Vranda U. Matkari
Section 10ASection 143(3)Section 144Section 147Section 148Section 250Section 264ASection 40

detail and held that addition u/s 68 of the Act can be made along with estimation of income unless the assessee establish that unexplained cash credit was arising out of the profit of business of assessee. The relevant finding in para 6 to 7 is reproduced as under ... return filed by the assessee, that does not prevent the ITO from treating, but entitles him to treat, the unexplained cash credit as income from undisclosed sources which falls under the head of income "income from other sources". Unless the assessee, by independent and satisfactory evidence, establishes that those amounts

M/S.Vibgyor Texotech Private Limited, Mumbai vs. ACIT-8(3)(2), Mumbai

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

ITA 1514/MUM/2018[2008-09]Status: DisposedITAT Mumbai27 Sept 2023AY 2008-09

Bench: Shri S. Rifaur Rahman, Am & Ms. Kavitha Rajagopal, Jm

For Appellant: NoneFor Respondent: Shri Vranda U. Matkari
Section 10ASection 143(3)Section 144Section 147Section 148Section 250Section 264ASection 40

detail and held that addition u/s 68 of the Act can be made along with estimation of income unless the assessee establish that unexplained cash credit was arising out of the profit of business of assessee. The relevant finding in para 6 to 7 is reproduced as under ... return filed by the assessee, that does not prevent the ITO from treating, but entitles him to treat, the unexplained cash credit as income from undisclosed sources which falls under the head of income "income from other sources". Unless the assessee, by independent and satisfactory evidence, establishes that those amounts

D.C.I.T. - 15(3)(2), Mumbai vs. Sadguru Management Consultancy P. Ltd., Mumbai

In the result ground of appeal filed by the assessee under rule 27 of ITAT Rule is allowed and appeal of the revenue is dismissed

ITA 6323/MUM/2017[2009-10]Status: DisposedITAT Mumbai27 Sept 2023AY 2009-10

Bench: Aby T Vakery & Shri Amarjit Singhdy. Commissioner Of Vs. Sadguru Management Income Tax- 15(3)(2) Consultancy Pvt. Ltd Room No. 451, 4 Th Floor, 7, Gagangiri, Plot No. 47, Aayakar Bhavan, Sector 17, Vashi, Navi Maharshi Karve Road, Mumbai- 400703 Mumbai- 400020 स्थायी लेखा सं./जीआइआर सं./ Pan/Gir No: Aamcs1626F Appellant .. Respondent

For Appellant: Shri Dharan Gandhi, ARFor Respondent: Shri Suresh D. Gaikwad, DR
Section 132Section 143(1)Section 148Section 250Section 68

obtained by the assessee 4 Sadguru Management Consultancy P. Ltd from the concerns of Shri. Pravin Kumar Jain as unexplained cash credit u/s 68 of the Act and the amount of Rs. 1,70,00,000/- added to the total income of assessee. 5. The assessee filed appeal before

ACIT, CC-14, Delhi vs. Rama Hygienic Products Pvt. Ltd., Bulandshahr

Accordingly the appeal of Revenue is dismissed and of assessee is allowed

ITA 2006/DEL/2021[2017-18]Status: DisposedITAT Delhi27 Sept 2023AY 2017-18

Bench: Sh. M. Balaganesh & Sh.Anubhav Sharma

Section 115BSection 143(3)Section 271ASection 68

been also considered and offered for taxation, how could the cash deposited out of the very same cash sales can be regarded as unexplained cash credits. The bench is also of the view that when the nature of business is accepted by the Tax authorities to be of substantial cash

Rama Hygienic Products Pvt. Ltd., Bulandshahr vs. ACIT, Central Circle- 14, New Delhi

Accordingly the appeal of Revenue is dismissed and of assessee is allowed

ITA 1455/DEL/2021[2017-18]Status: DisposedITAT Delhi27 Sept 2023AY 2017-18

Bench: Sh. M. Balaganesh & Sh.Anubhav Sharma

Section 115BSection 143(3)Section 271ASection 68

been also considered and offered for taxation, how could the cash deposited out of the very same cash sales can be regarded as unexplained cash credits. The bench is also of the view that when the nature of business is accepted by the Tax authorities to be of substantial cash

Khazana Bazar Pvt. Ltd., Surat vs. Income Tax Officer, Ward - 1(1)(3), Surat

In the result, appeal filed by the assessee is allowed

ITA 335/SRT/2022[2015-16]Status: DisposedITAT Surat27 Sept 2023AY 2015-16

Bench: Shri Pawan Singh, Jm & Dr. A. L. Saini, Am आयकर अपील सं./Ita No.335/Srt/2022 Assessment Year: (2015-16) (Physical Court Hearing) Khazana Bazar Pvt. Ltd., Income Tax Officer, Ward- C-104, Radha Raman Textile 1(1)(3), Surat, Room No.113, Market, Saroli,Surat-395010 Vs. Aayakar Bhawan, Majura Gate, Surat-395001 "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Aafck 0726 P (अपीलाथ"/Appellant) (""थ" /Respondent)

Section 142(1)Section 143(2)Section 143(3)Section 68

above phraseology of section 68 is clear. The Legislature has laid down that in the absence of a satisfactory explanation, the unexplained cash credit may be charged to income-tax as the income of the assessee of that previous year. In this case the legislative mandate is not in terms

Surjit Kaur, Jaipur vs. ITO Ward 4(3), Jpr, Jaipur

In the result, appeal of the assessee is allowed for statistical purpose

ITA 401/JPR/2023[2017-18]Status: DisposedITAT Jaipur27 Sept 2023AY 2017-18

Bench: SHRI SANDEEP GOSAIN (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri Mahendra Gargieya, AdvocateFor Respondent: Mrs. Monisha Choudhary, Addl. CIT
Section 115BSection 142(1)Section 144Section 145(3)Section 234ASection 234BSection 3Section 68

dated 13.12.2019 having been framed in gross breach of natural justice, kindly be quashed. 3.1 Addition of Rs.57,22,400/- as unexplained cash credit: The ld. AO erred in law as well as on the facts of the case in making addition u/s 68 of the Act, of a huge ... account maintained but the assessee has not filed any explanation. Based on these observation a sum of Rs. 57,22,400/- added as unexplained cash credit u/s. 68 of the Act. 3.2 During the assessment proceeding the ld. AO also noted that the assessee has not maintained / produced any books

Humuza Consultants, Mumbai vs. The CIT (A), Nface Inc Tx Dept, Delhi

The appeal of the assessee is allowed for statistical purposes

ITA 2193/MUM/2023[2017-18]Status: DisposedITAT Mumbai26 Sept 2023AY 2017-18

Bench: Vikas Awasthy () & Ms. Padmavathy S. ()

Section 10Section 10(34)Section 115BSection 115OSection 142(1)Section 143(1)Section 143(2)Section 143(3)Section 15BSection 68

Grounds No.6 to15) 2 ITA 2193/Mum/2023 Humuza Consultants iii. Treatment of the long term capital gain on transfer of shares as unexplained cash credit under section 68 – Ground No.16 to18 iv. Levy of tax under section 115BBE - Ground No.19 v. Levy of interest and initiation of penalty proceedings – Ground

Ron Creations Private Limited, Mumbai vs. Income Tax Officer 16(1)(5), Mumbai

In the result, appeal filed by the Assessee stands allowed

ITA 1551/MUM/2023[2010-2011]Status: DisposedITAT Mumbai26 Sept 2023AY 2010-2011

Bench: Shri N. K. Choudhry, Jm

For Appellant: Sh. Atul Mehta & Uday Shah, CAFor Respondent: Sh. Anurag Tripathi, DR
Section 133(6)Section 143(1)Section 148Section 250Section 68

failed, therefore, the transaction of purchase of Arri Camera Lenses for the amount of Rs. 22,59,000/- from MTPL was treated as unexplained cash credit under section 68 of the Act by the AO and added back to the total income of the Assessee. 3 Ron Creations

E-Ally Consulting (India) Pvt Ltd., Mumbai vs. DCIT, CC-1(1), Mumbai

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

ITA 1230/MUM/2023[2013-14]Status: DisposedITAT Mumbai25 Sept 2023AY 2013-14

Bench: Shri Amit Shukla & Shri Gagan Goyal

For Appellant: Shri Jayant R. Bhatt, Ld. ARFor Respondent: Shri Biswanath Das, CIT-DR
Section 132Section 153CSection 250Section 68

Commissioner of Income Tax (Appeals) erred in confirming the addition of Rs. 1, 65, 00,000/- by treating the loan received as unexplained cash credit u/s 68 of the Income Tax Act, 1961. E-Ally Equities (India) Pvt. Ltd., E-Ally Commodities (India) Pvt. Ltd., 5. The Appellant craves leaves ... Commissioner of Income Tax (Appeals) erred in confirming the addition of Rs. 2, 38, 50,000/- by treating the loan received as unexplained cash credit u/s 68 of the Income Tax Act, 1961. 5. The Appellant craves leaves to add, to amend, alter, modify and/or withdraw

M.K.S.Engineering Company Pvt. Ltd., Jabalpur vs. Pr. Commissioner of Income Tax - 1, Jabalpur

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

ITA 11/JAB/2021[2010-11]Status: DisposedITAT Jabalpur22 Sept 2023AY 2010-11

Bench: Shri Om Prakash Kantshri Pavan Kumar Gadaleshri Saurabh Baderiya, Vs Acit, 1752, Saraswati Colony, Central Circle, Cherital Ward, Jabalpur, Jabalpur M.P.-482002. (Appellant) (Respondent) Pan No. Ahipb3208Q Assessee By Shri Rahul Bardia, Fca Revenue By Shri Saad Kidwai, Cit Dr Date Of Hearing 21/09/2023 Date Of Pronouncement 22/09/2023

Section 132Section 153ASection 153DSection 68

made addition for unsecured loans received from m/s Vaibhav Pipes Pvt.Ltd. of Rs.26,99,878/- as unexplained cash credit u/s 68 of the Act, holding that the Vaibhav Pipes Pvt.Ltd. was an accommodation entry provider entity. On further appeal, Ld.CIT(A) upheld the addition by observing as under

Assistant Commissioner of Income Tax Circle-Satna, Satna vs. M/S. Ram Kumar Suresh Kumar, Satna

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

ITA 136/JAB/2018[2013-14]Status: PendingITAT Jabalpur22 Sept 2023AY 2013-14

Bench: Shri Om Prakash Kantshri Pavan Kumar Gaaleasst. Commissioner Of Vs Shri Ram Kumar Income Tax, Circle-Satna, Suresh Kumar, Satna Birla Road, Satna (Appellant) (Respondent) Pan No. Aaffr3899D Revenue By Shri Shravan Kumar Gotru, Cit Dr Assessee By Shri Rahul Bardia, Fca Date Of Hearing 13/09/2023 Date Of Pronouncement 22/09/2023 O R D E R Per Om Prakash Kant, A.M.: This Appeal By The Revenue Is Directed Against Order Dated 12.03.2018 Passed By Ld. Commissioner Of Income Tax(Appeals)-1, Jabalpur [In Short “Ld.Cit(A)”] For The Assessment Year 2013-14, Raising Following Grounds:

Section 133(6)Section 68

credited during the year under the name of M/s. P.G.Enterprises to be added to the income of the assessee as unexplained cash credit. In view of no response, the AO held the credit of said purchase as unexplained cash credit in terms of section 68 of the Act. On further ... issued by M/s P.G. Enterprises were held to be not genuine and added to the income of the assessee as unexplained cash credits. 7.1.5. The argument put forth on behalf of the appellant in nut shell is that the creditor had confirmed the credit in compliance with notice under