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“addition under section 68”

Cash Credits & Unexplained ItemsSection 68Section 681,640 judgments

The decision most relied on for addition under section 68 is CIT v. Durga Prasad More (82 ITR 540), cited in 1,579 judgments on BharatTax.

Leading authorities on addition under section 68

CIT v. Durga Prasad More
82 ITR 540 · 1971 · Supreme Court
1,579
citing judgments

Tax authorities must judge evidence using the test of human probabilities and consider the apparent as real until there are reasons to believe it is not. They can rely on circumstantial evidence and the preponderance of probabilities to determine the genuineness of transactions.

CIT v. Lovely Exports (P) Ltd.
216 CTR 195 · 2008 · Supreme Court
854
citing judgments

If an assessee company receives share application money from alleged bogus shareholders and provides their details to the Assessing Officer, no addition can be made under Section 68 in the company's hands; the Department must proceed against the shareholders by reopening their individual assessments.

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.

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.

Umacharan Shaw & Bros. v. CIT
37 ITR 271 · 1959 · Supreme Court
567
citing judgments

An income tax assessment or addition cannot be sustained solely on the basis of suspicion, surmises, or conjectures, as strong suspicion does not amount to proof. The revenue authorities must rely on concrete evidence and material to frame an assessment.

Roshan Di Hatti v. CIT
107 ITR 938 · 1977 · Supreme Court
477
citing judgments

An assessee bears the onus to prove the identity, creditworthiness, and genuineness of any cash credit or transaction. If the assessee fails to discharge this burden with cogent evidence and explanation, the Assessing Officer is justified in making additions to their income, and no further burden lies on the revenue.

Judgments citing addition under section 68

Ram Kumar Gupta, Kolkata vs. ACIT, Cir. 43, Kolkata

In the result, the appeal of the assessee stands allowed

ITA 309/KOL/2024[2017-18]Status: DisposedITAT Kolkata09 Aug 2024AY 2017-18

Bench: Shri Sanjay Garg & Shri Sanjay Awasthii.T.A. No.309/Kol/2024 Assessment Year: 2017-18 Ram Kumar Gupta…...…………….....……………………....………....Appellant 67/46, Posta Chowrasta, Kolkata -700007. [Pan: Adrpg8556B] Vs. Acit, Circle-43, Kolkata…...................................................…..…..... Respondent Appearances By: Shri Rajiva Kumar, Ar, Appeared On Behalf Of The Appellant. Shri Abhijit Kundu, Cit- Dr On Behalf Of P. P. Barman, Sr. Dr, Appeared On Behalf Of The Respondent. Date Of Concluding The Hearing : May 30, 2024 Date Of Pronouncing The Order : August 09, 2024 आदेश / Order संजय गग", "या"यक सद"य "वारा / Per Sanjay Garg: The Present Appeal Has Been Preferred By The Assessee Against The Order Dated 07.12.2023 Of The National Faceless Appeal Centre [Hereinafter Referred To As ‘Cit(A)’] Passed U/S 250 Of The Income Tax Act (Hereinafter Referred To As The ‘Act’). 2. The Assessee In This Appeal Has Agitated Against The Confirmation Of Addition Of Rs.1,10,46,000/- Made By The Assessing Officer On Account Of Cash Deposits In The Bank Account Of The Assessee During Demonetization Period. 3. The Brief Facts Of The Case Are That The Assessee Derives Income From Retail Trading In The Name Of M/S R. Kumar & Co. The Assessee Filed His Return Of Income On 28.07.2017 Declaring A Total Income Of Rs.8,19,420/-. The Return Was Selected For Scrutiny & Notices U/S

Section 250Section 44ASection 68

Agson Global (P) Ltd [2022] 134 taxmann.com 256 (Delhi), the Delhi High Court held that in a case where the AO made addition under section 68 on account of cash deposit made by assessee post demonetization, since assessee placed material on record to prove that cash deposits made with banks

Lks Bullion (Import and Export) Pvt.Ltd., Ahmedabad vs. The Income Tax Officer, Ward-2(1)(3), Ahmedabad

In the result, the appeal by Assessee is partly allowed

ITA 382/AHD/2022[2010-11]Status: DisposedITAT Ahmedabad08 Aug 2024AY 2010-11

Bench: Ms. Suchitra Kamble & Shri Makarand V. Mahadeokarआयकर अपील सं /Ita No.382/Ahd/2022 "नधा"रण वष" /Assessment Year : 2010-11 L.K.S. Bullion (Import & The Income Tax Officer बनाम/ Export) Pvt.Ltd. Ward-2(1)(3) 368, Lks House, Ahmedabad – 380 014 V/S. Khetarpal-Ni-Pole Manek Chowk Ahmedabad -380 001 (Gujarat) "थायी लेखा सं./Pan: Aaacl 7369 N अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Shri S.N. Soparkar, Sr.Advocate & Shri Parin Shah, Ar Revenue By : Shri Alpesh Parmar, Sr.Dr सुनवाई क" तार"ख/Date Of Hearing : 05/08/2024 घोषणा क" तार"ख /Date Of Pronouncement: 08/08/2024 आदेश/O R D E R Per Shri Makarand V. Mahadeokar, Am: This Appeal Is Filed By The Assessee As Against The Order Dated 27/08/2022 Passed By The Commissioner Of Income-Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi [Hereinafter Referred To As “The Ld.Cit(A)” In Short] Arising Out Of The Assessment Order Dated 18/12/2017 By The Assessing Officer (Ao) Under Section 143(3) R.W.S. 147 Of The Income L.K.S. Bullion (Import & Export) Pvt.Ltd. Vs. Ito Asst. Year : 2010-11

For Appellant: Shri S.N. Soparkar, Sr.Advocate &For Respondent: Shri Alpesh Parmar, Sr.DR
Section 131Section 133(6)Section 143(1)Section 143(3)Section 148

Ld.CIT(A) is deleted, and these grounds of appeal are allowed. On Ground Nos. 5 to 7 10. Since we have deleted the addition under Section 68 of the Act, the confirmation by the Ld.CIT(A) of the AO's action to tax the income under Section 115BBE

The Panchmahals Dist. Co. Op. Bank Ltd., Godhra vs. The Income Tax Officer, Ward-3(1)(2), Vadodara

In the result, the appeal of the Assessee is allowed

ITA 675/AHD/2023[2017-18]Status: DisposedITAT Ahmedabad31 Jul 2024AY 2017-18

Bench: Shri Siddhartha Nautiyal & Shri Makarand V. Mahadeokarआयकर अपील सं /Ita No.675/Ahd/2023 "नधा"रण वष" /Assessment Year : 2017-18 The Panchmahals Dist. Co- The Ito Op.Bank Ltd. बनाम/ Ward-3(1)(2), Prabha Road Vadodara V/S. Dahod Highway Godhra – 389 001 (Gujarat) "थायी लेखा सं./Pan: Aaajt 0268 P (अपीलाथ"/ Appellant) ("" यथ"/ Respondent) Assessee By : Shri Mehul K. Patel, Ar Revenue By : Shri Kamlesh Makwana, Cit-Dr सुनवाई क" तार"ख/Date Of Hearing : 25/07/2024 घोषणा क" तार"ख /Date Of Pronouncement: 31/07/2024 आदेश/O R D E R Per Shri Makarand V. Mahadeokar, Am: This Appeal Is Filed By The Assessee As Against The Order Dated 14/08/2023 Passed By The Commissioner Of Income-Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi [Hereinafter Referred To As “The Ld.Cit(A)” In Short] Arising Out Of The Assessment Order Dated 29/12/2019 Passed By The Assessing Officer (Ao) Under Section 143(3) Of The Income The Panchmahals Dist. Co-Op. Bank Ltd. Vs. Ito Asst. Year : 2017-18

For Appellant: Shri Mehul K. Patel, ARFor Respondent: Shri Kamlesh Makwana, CIT-DR
Section 115BSection 143(2)Section 143(3)Section 234BSection 69A

primary issue concerned the addition made under Section 68 of the Act. The Tribunal upheld the Ld.CIT(A)'s decision to delete the addition under Section 68 of the Act, as the assessee had sufficiently demonstrated compliance with KYC norms, systematic record-keeping, and the genuineness of the transactions. This ... case reinforces the principle that adherence to regulatory norms and systematic record-keeping can effectively counter additions under Section 68 related to unexplained credits in the context of banking and financial institutions. In case of The Commissioner of Income Tax (appellant) vs. Pragati Co-operative Bank Ltd. (supra