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“addition u/s 68”

Cash Credits & Unexplained ItemsSection 68Section 682,598 judgments

The decision most relied on for addition u/s 68 is CIT v. Lovely Exports (P) Ltd. (216 CTR 195), cited in 854 judgments on BharatTax.

Leading authorities on addition u/s 68

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. Divine Leasing & Finance Ltd.
299 ITR 268 · 2008 · High Court
426
citing judgments

The Assessing Officer cannot add share capital or share premium amounts if the assessee provides the identity and creditworthiness of the subscriber and establishes the genuineness of the transaction. The court may admit additional evidence under Rule 46A, such as the PAN identity of the creditor.

CIT v. Devi Prasad Vishwanath Prasad
72 ITR 194 · 1969 · Supreme Court
272
citing judgments

If there is an unexplained cash credit, the Assessing Officer can treat it as the assessee's income, even when the income is finalized on an estimation basis, without proving its specific source. The onus then shifts to the assessee to prove that the income represented by the cash credit has already been taxed.

CIT v. Dwarkadhish Investment (P) Ltd.
330 ITR 298 · 2011 · High Court
218
citing judgments

An assessee cannot be asked to explain the source of the source for cash credits, particularly share capital or share application money, once they have discharged the initial onus regarding the identity, genuineness of the transaction, and creditworthiness of the immediate investor.

1) CIT v. Sahibganj Electric Cables Pvt. Ltd. (
151 ITR 150 · 1985 · High Court
79
citing judgments

The assessee's burden under Section 68 to prove cash credits is discharged by establishing the identity of the creditor and the genuineness of the transaction; the assessee is not required to prove the creditor's source of funds or creditworthiness, as the department can use Section 131 for further investigation.

Jatia Investment Co. v. CIT
206 ITR 718 · 1994 · High Court
77
citing judgments

An addition under Section 68 for unexplained cash credits cannot be made when there is no actual cash credit or flow of funds, such as in cases of share swaps or notional credits.

Hastimal v. CIT
49 ITR 273 · 1963 · High Court
57
citing judgments

An assessee's duty regarding the creditworthiness of a creditor is limited to the transactions between them, and they are not required to investigate the ultimate source of the creditor's funds. If the genuineness of the transaction and the creditworthiness are established, no addition under Section 68 is permissible.

CIT v. Prameshwar Bohra
301 ITR 404 · 2008 · High Court
47
citing judgments

An amount already credited in the books of account in an earlier assessment year cannot be added again as an unexplained cash credit under Section 68 of the Income-tax Act in a subsequent assessment year.

Judgments citing addition u/s 68

Asst CIT CC 1 (3), Mumbai vs. M/S Poonam Skyline Construction, Mumbai

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

ITA 752/MUM/2020[2012-13]Status: DisposedITAT Mumbai05 Dec 2022AY 2012-13
Section 132(1)Section 133A

Income tax Act, more particularly the provisions relating to legal fiction, have to be interpreted strictly. Hence the AO could not make addition u/s 68 of the Act on mere suspicions, surmises and conjectures. 17. We notice that identical addition has been made in the hands of these assessees ... their transactions. Therefore, he opined that the transactions between the parties are failed to pass the test of genuineness and accordingly made additions u/s 68 of the Act. 12. The provisions of section 68 of the Act deals with the cases, where any sum found credited in the books

Asst CIT CC 1 (3), Mumbai vs. M/S Poonam Shanti Developers, Mumbai

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

ITA 751/MUM/2020[2013-14]Status: DisposedITAT Mumbai05 Dec 2022AY 2013-14
Section 132(1)Section 133A

Income tax Act, more particularly the provisions relating to legal fiction, have to be interpreted strictly. Hence the AO could not make addition u/s 68 of the Act on mere suspicions, surmises and conjectures. 17. We notice that identical addition has been made in the hands of these assessees ... their transactions. Therefore, he opined that the transactions between the parties are failed to pass the test of genuineness and accordingly made additions u/s 68 of the Act. 12. The provisions of section 68 of the Act deals with the cases, where any sum found credited in the books

Asst CIT CC 1 (3), Mumbai vs. M/S Poonam Realty, Mumbai

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

ITA 750/MUM/2020[2014-15]Status: DisposedITAT Mumbai05 Dec 2022AY 2014-15
Section 132(1)Section 133A

Income tax Act, more particularly the provisions relating to legal fiction, have to be interpreted strictly. Hence the AO could not make addition u/s 68 of the Act on mere suspicions, surmises and conjectures. 17. We notice that identical addition has been made in the hands of these assessees ... their transactions. Therefore, he opined that the transactions between the parties are failed to pass the test of genuineness and accordingly made additions u/s 68 of the Act. 12. The provisions of section 68 of the Act deals with the cases, where any sum found credited in the books

Asst CIT CC 1 (3), Mumbai vs. M/S Poonam Mega Developers, Mumbai

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

ITA 749/MUM/2020[2012-13]Status: DisposedITAT Mumbai05 Dec 2022AY 2012-13
Section 132(1)Section 133A

Income tax Act, more particularly the provisions relating to legal fiction, have to be interpreted strictly. Hence the AO could not make addition u/s 68 of the Act on mere suspicions, surmises and conjectures. 17. We notice that identical addition has been made in the hands of these assessees ... their transactions. Therefore, he opined that the transactions between the parties are failed to pass the test of genuineness and accordingly made additions u/s 68 of the Act. 12. The provisions of section 68 of the Act deals with the cases, where any sum found credited in the books

Asst CIT CC 1 (3), Mumbai vs. M/S Poonam Mega Developers, Mumbai

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

ITA 748/MUM/2020[2011-12]Status: DisposedITAT Mumbai05 Dec 2022AY 2011-12
Section 132(1)Section 133A

Income tax Act, more particularly the provisions relating to legal fiction, have to be interpreted strictly. Hence the AO could not make addition u/s 68 of the Act on mere suspicions, surmises and conjectures. 17. We notice that identical addition has been made in the hands of these assessees ... their transactions. Therefore, he opined that the transactions between the parties are failed to pass the test of genuineness and accordingly made additions u/s 68 of the Act. 12. The provisions of section 68 of the Act deals with the cases, where any sum found credited in the books

Jt. CIT (OSD) CC-7(1), Mumbai vs. Shri. Sujan Azad Parikh, Mumbai

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

ITA 775/MUM/2019[2015-16]Status: DisposedITAT Mumbai02 Dec 2022AY 2015-16

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhail

For Appellant: Shri Satish ModiFor Respondent: Shri Ajay Singh
Section 143(3)Section 250Section 260ASection 68

year 1992." (2) On the facts and in the circumstances of the case and in law, the CIT(A) erred in deleting the addition u/s 68 of the IT Act 1961 as unexplained cash credit, without appreciating the fact that the explanation offered by the assessee in respect of credit ... actual owner Smt. Avani Azad Parikh, When the purpose and source of credit has been explained, there is no case for an addition u/s 68 of the Income Tax Act. Therefore, the addition of Rs.7,62,50,000/- made by the AO as unexplained cash credit is deleted. These grounds

Mahendra Poonamchand Angara, Mumbai vs. Circle 19(2), Mumbai

In the result, all these appeals of the assessee are allowed

ITA 1994/MUM/2022[2012-13]Status: DisposedITAT Mumbai30 Nov 2022AY 2012-13

Bench: Shri Aby T. Varkey & Shri Amarjit Singh

For Appellant: Bharat KumarFor Respondent: Mahita Nair
Section 131Section 133(6)Section 143(1)Section 147Section 148Section 68

facts and in the circumstances of the case and in law, the Ld. CIT (A) erred in confirming addition u/s 68 on account of unsecured loan of rs.25,00,000/-. 3. On the facts and in the circumstances of the case 2 and in law, the Ld. CIT (A) erred ... issue reads as under:- “7. We have heard the rival contentions, and perused the record. The Assessing Officer has made impugned addition u/s. 68 of the Act on the ground that loan of Rs. 25 lakhs taken from Rose Impex was bogus since Rose Impex belonged to Mr. Bhanwarlal Jain

Mahendra Poonamchand Angara, Mumbai vs. Circle-19(2), Mumbai

In the result, all these appeals of the assessee are allowed

ITA 1993/MUM/2022[2011-2012]Status: DisposedITAT Mumbai30 Nov 2022AY 2011-2012

Bench: Shri Aby T. Varkey & Shri Amarjit Singh

For Appellant: Bharat KumarFor Respondent: Mahita Nair
Section 131Section 133(6)Section 143(1)Section 147Section 148Section 68

facts and in the circumstances of the case and in law, the Ld. CIT (A) erred in confirming addition u/s 68 on account of unsecured loan of rs.25,00,000/-. 3. On the facts and in the circumstances of the case 2 and in law, the Ld. CIT (A) erred ... issue reads as under:- “7. We have heard the rival contentions, and perused the record. The Assessing Officer has made impugned addition u/s. 68 of the Act on the ground that loan of Rs. 25 lakhs taken from Rose Impex was bogus since Rose Impex belonged to Mr. Bhanwarlal Jain

Mahendra Poonamchand Angara, Mumbai vs. Circle 19(2), Mumbai

In the result, all these appeals of the assessee are allowed

ITA 1992/MUM/2022[2009-2010]Status: DisposedITAT Mumbai30 Nov 2022AY 2009-2010

Bench: Shri Aby T. Varkey & Shri Amarjit Singh

For Appellant: Bharat KumarFor Respondent: Mahita Nair
Section 131Section 133(6)Section 143(1)Section 147Section 148Section 68

facts and in the circumstances of the case and in law, the Ld. CIT (A) erred in confirming addition u/s 68 on account of unsecured loan of rs.25,00,000/-. 3. On the facts and in the circumstances of the case 2 and in law, the Ld. CIT (A) erred ... issue reads as under:- “7. We have heard the rival contentions, and perused the record. The Assessing Officer has made impugned addition u/s. 68 of the Act on the ground that loan of Rs. 25 lakhs taken from Rose Impex was bogus since Rose Impex belonged to Mr. Bhanwarlal Jain

DCIT CC-5(1), Mumbai vs. Jogia Properties Limited, Mumbai

In the result, the appeal filed by the revenue are dismissed and the Cross Objection filed by the assessee also dismissed

ITA 471/MUM/2018[2009-10]Status: DisposedITAT Mumbai30 Nov 2022AY 2009-10

Bench: Shri Amit Shukla & Shri Amarjit Singhita Nos.468 /Mum/2018 (A.Y.2009-10) Dcit, Cc-5(1) Vs. M/S Vedisa Properties R. No. 1928, 19Th Floor, Limited, 324, Air India Building, Master Mind- Iv, Royal Nariman Point, Palms, Aarey Milk Colony Mumbai – 400 021 Goregaon East, Mumbai – 400 065 स्थायी लेखा सं./जीआइआर सं./ Pan/Gir No: Aabcv3199B Respondent .. Appellant

For Appellant: Vijah MehtaFor Respondent: Achal Sharma
Section 132(1)Section 133ASection 139(1)Section 143(3)Section 147Section 148Section 153A

Vedisa Properties Ltd. 6 & M/s Jogia Properties Ltd. A.Y. 2009-10 “8.29. The AR has also contended that similar addition u/s 68 is made in the cases of the Shree Global Tradefin Ltd. (SGTL) whose appeals are pending before me. While the amounts received through these entities are not genuine

DCIT CC-5(1), Mumbai vs. Vedisa Properties Limited, Mumbai

In the result, the appeal filed by the revenue are dismissed and the Cross Objection filed by the assessee also dismissed

ITA 468/MUM/2018[2009-10]Status: DisposedITAT Mumbai30 Nov 2022AY 2009-10

Bench: Shri Amit Shukla & Shri Amarjit Singhita Nos.468 /Mum/2018 (A.Y.2009-10) Dcit, Cc-5(1) Vs. M/S Vedisa Properties R. No. 1928, 19Th Floor, Limited, 324, Air India Building, Master Mind- Iv, Royal Nariman Point, Palms, Aarey Milk Colony Mumbai – 400 021 Goregaon East, Mumbai – 400 065 स्थायी लेखा सं./जीआइआर सं./ Pan/Gir No: Aabcv3199B Respondent .. Appellant

For Appellant: Vijah MehtaFor Respondent: Achal Sharma
Section 132(1)Section 133ASection 139(1)Section 143(3)Section 147Section 148Section 153A

Vedisa Properties Ltd. 6 & M/s Jogia Properties Ltd. A.Y. 2009-10 “8.29. The AR has also contended that similar addition u/s 68 is made in the cases of the Shree Global Tradefin Ltd. (SGTL) whose appeals are pending before me. While the amounts received through these entities are not genuine

Sss Sai Shipping Services Private Limited, Mumbai vs. Deputy Commissioner of Income Tax-1(3)(1), Mumbai

ITA 6261/MUM/2017[2008-09]Status: DisposedITAT Mumbai30 Nov 2022AY 2008-09

Bench: Shri Kuldip Singh & Shri Amarjit Singhassessment Year: 2008-09 M/S. Sss Sai Shipping Dy. Commissioner Of Services Pvt. Ltd., Income Tax-1(3)(1), A-304, Classique Centre, Aayakar Bhavan, Plot Number-26, Vs. Annex, Mahal Industrial Estate, Maharshi Karve Marg, Andheri (West), Mumbai - 400020 Mumbai – 400 093 Pan: Aalcs4908D (Appellant) (Respondent)

For Appellant: NoneFor Respondent: Shri Tejinder Pal Singh Anand, D.R
Section 131Section 144Section 147Section 148Section 151Section 68

assessment was completed u/s 144 r.w.s. 147 of the IT Act, 1961 at an income of Rs. 5,62,08,798/- as an addition u/s 68 of the I T Act, 1961. The appellant assessee did not appear during the course of assessment proceedings because of his ill health

Sabara Impex Ltd, Mumbai vs. ITO WD 2(3)(2), Mumbai

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

ITA 3267/MUM/2013[1996-97]Status: DisposedITAT Mumbai17 Nov 2022AY 1996-97

Bench: Shri Vikas Awasthy & Shri Gagan Goyal

For Appellant: NoneFor Respondent: Ms. Nilu Jaggi, Sr.DR
Section 131Section 143(3)Section 147Section 148Section 68Section 80H

M.Ganapathi Mudaliar 53 ITR 623 (S.C)  A.Govindarajulu Mudalair Vs CIT 34 ITR 807 (S.C) In view of the above addition u/s 68 is rightly made and ground no -4 raised by assessee are dismissed. 7 ITA No. 3267 Mum 2013 & 404 Mum 2016-Sabara Impex

Mbm Tubes P.Ltd, Mumbai vs. ITO 5(2)(3), Mumbai

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

ITA 5938/MUM/2014[2010-11]Status: DisposedITAT Mumbai15 Nov 2022AY 2010-11

Bench: Shri Prashant Maharishi & Shri Pavan Kumar Gadalem/S Mbm Tubes Pvt Ltd Vs. Ito – 5(2)(3) Mohanlal Jain & Co, Ca Mumbai. Office No. 10, Chartered House, Ground Floor, Dr Ch Street, Marine Lines Mumbai – 2. "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aafcm4177L Appellant .. Respondent Appellant By : None Respondent By : Shri Chetan M. Kacha.Dr Date Of Hearing 09.11.2022 Date Of Pronouncement 21.11.2022 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Assessee Has Filed The Appeal Against The Order Passed By The Commissioner Of Income Tax (Appeals)Cit(A)-9, Mumbai Passed U/S 143(3) & 250 Of The Act. The Assessee Has Raised The Fallowing Grounds Of Appeal: M/S. Mbm Tubes Pvt Ltd, Mumbai. 1. On The Facts & In The Circumstances Of The Case & In Law The Honble Cit(A) Erred In Treating The Genuine Purchases As Bogus By Taking Peak Credit Of Purchase Parties Listed On Mvat Site As Un Explained Purchases Of Rs.55,80,857/- As Unexplained U/Sec69C Of The It Act & The Reasons Assigned For Doing Are Wrong & Contrary To The Provision Of Income Tax & Rules Made There Under. 2. Your Appellant Crave,Leave To Add,Alter,Amend,Or Modify Any Or All Grounds Of Appeal On Or Before The Date Of Hearing.

For Appellant: NoneFor Respondent: Shri Chetan M. Kacha.DR
Section 133(6)Section 143(1)Section 143(2)Section 143(3)Section 68

submissions of the assessee and findings of the AO and has dealt on the facts with respect to unsecured loans and deleted the addition u/s 68 of the Act. On the second disputed issue with respect to bogus purchases the CIT(A) has dealt on the transactions on the peak

DCIT CC -7(2), Mumbai vs. M/S. Dewal Engineering Pvt. Ltd, Mumbai

In the result, appeal filed by the Revenue is dismissed

ITA 2268/MUM/2021[2011-12]Status: DisposedITAT Mumbai14 Nov 2022AY 2011-12

Bench: Shri Aby T Varkey () & Shri Amarjit Singh ()

Section 132Section 132(4)Section 143(2)Section 143(3)Section 153ASection 153CSection 153C(1)Section 68

further find that the statement made by Shri Thakkar has no nexus with any seized material. In fact, the addition u/s 68 is not based upon any seized/incriminating material at all. Hon'ble Delhi High Court in the case of CIT vs Harjeev Aggarwal, 241 Taxman 199 (Delhi) have held

M/S. Jupiter Infratrade Pvt. Ltd., Mumbai vs. ITO, Circle 6 (1)(3), Mumbai

In the result, the appeal of the assessee is allowed

ITA 2061/MUM/2022[2009-10]Status: DisposedITAT Mumbai07 Nov 2022AY 2009-10
Section 143(1)Section 148Section 254(2)Section 68

hence the assessee has filed this appeal before the Tribunal. 4. The Ld A.R submitted that the assessing officer has made the addition u/s 68 of the Act. The assessee has discharged the initial onus to prove the cash credits by furnishing all the information to prove the three main ... running into crores. Accordingly, the Ld A.R submitted that the facts prevailing in the instant case stand on sound footing and hence no addition u/s 68 is warranted. 4 Jupiter Infratrade Pvt. Ltd. 8. I heard rival submissions and perused the record. During the year under consideration the assessee

DCIT Central Circle-8(4), Mumbai vs. M/S.Gandhar Yarn Private Limited, Mumbai

In the result, the appeal by the Revenue is dismissed

ITA 907/MUM/2018[2009-10]Status: DisposedITAT Mumbai07 Nov 2022AY 2009-10

Bench: Shri M. Balaganesh & Shri Sandeep Singh Karhail

For Appellant: Shri Rakesh JoshiFor Respondent: Shri P.P. Mane
Section 131Section 133(6)Section 143(1)Section 147Section 250Section 68

through M/s Akshunya Energy Private Limited by Shri Kamal Khetan of Sunteck Group in the A.Y. 2012-13. On the contrary, the entire addition u/s 68 of the Act for the M/s. Gandhar Yarn Pvt. Ltd. ITA No.907/Mum./2018 share premium has been made ... contrary to material facts on record. M/s. Gandhar Yarn Pvt. Ltd. ITA No.907/Mum./2018 12.31 In fact, for making a case of addition u/s 68 of the Act for the current year under consideration, the A.O. should have examined & rebutted the voluminous details of shareholders furnished by the Appellant Company

Nishith Rameshchandra Shah, Mumbai vs. Income Tax Officer Ward 23(2)(6), Mumbai

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

ITA 1116/MUM/2022[2012-2013]Status: DisposedITAT Mumbai04 Nov 2022AY 2012-2013
Section 10(38)Section 143(3)Section 250Section 68

assessment order u/s 143(3) r.w.s. 147 of the Act was passed on 03.12.2019 determining total income of Rs.18,78,540/- where, addition u/s 68 of the Act amounting to Rs.5,76,775/- was made on account of unexplained investment towards sale proceeds of shares of M/s. Diamant Infrastructure Limited

M/S Nickunj Eximp Enterprises P. Ltd., Mumbai vs. Asstt. CIT, CC-2(4), Mumbai

ITA 15/MUM/2021[2012-13]Status: DisposedITAT Mumbai31 Oct 2022AY 2012-13

Bench: Shri Amit Shukla, Jm & Shri S. Rifaur Rahman, Am आयकरअपीलसं./ I.T.A. No. 15/Mum/2021 (ननधधारणवर्ा / Assessment Year: 2012-13) Acit Cen. Cir,- 2(4), M/S Nikunj Eximp R. No. 802, Pratistha Enterprises Pvt. Ltd. बनाम/ 4Th Floor, Sri Joravar Bhavan, Bhavan, Old Cgo Vs. 93, M. K. Road, Marine Lines, Annexe, M. K. Marg, Mumbai-400 020 Mumbai-400 020 स्थधयीलेखधसं./जीआइआरसं./ Pan No. Aabcn0991K (अपीलधथी/Appellant) (प्रत्यथी / Respondent) : अपीलधथीकीओरसे/ Appellant By : Shri Vijay Mehta, Ld. Ar प्रत्यथीकीओरसे/Respondent By : Dr. Mahesh Akhade, Ld. Dr सुनवधईकीतधरीख/ : 13.09.2022 Date Of Hearing घोर्णधकीतधरीख / : 31.10.2022 Date Of Pronouncement आदेश / O R D E R Per Amit Shukla: The Aforesaid Appeal Has Been Filed By The Assessee Against The Impugned Order Dated 28.10.2020, Passed Ld. Cit(A)-58, Mumbai For The Quantum Of Assessment Passed U/S 143(3) R.W.S. 153A For Ay 2012-13. The Assessee Has Raised The Following Grounds:-

For Appellant: Shri Vijay Mehta, Ld. ARFor Respondent: Dr. Mahesh Akhade, Ld. DR
Section 132Section 132(4)Section 143(1)Section 143(3)Section 153ASection 3(1)Section 68

company namely, M/s Rapport Holding and Commercial Pvt. Ltd. 10 I.T.A. No. 15/Mum/2021 M/s Nikunj Eximp Enterprises Pvt. Ltd. He made the addition u/s 68. For other companies, he did not made any addition. 7. Before Ld. CIT(A), assessee has challenged the additions on the ground that there

Sandeep Shukla, `Mumbai vs. ITO, Ward- 2(4), Mumbai

In the result, appeals filed by the assessee are partly allowed

ITA 2062/MUM/2022[2012-13]Status: DisposedITAT Mumbai28 Oct 2022AY 2012-13
For Appellant: Shri Bharat KumarFor Respondent: Shri Sanyam Suresh Joshi
Section 143(3)Section 68

expenses. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in confirming addition u/s 68 of Rs. 56,94,580/-“ Ground No. 1 3. The facts, in brief, relevant to adjudication of Ground No. 1 are that the Appellant