“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

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

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

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

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

Deputy Commissioner of Income Tax, Mumbai vs. Me N Moms Private Limited, Mumbai

In the result, appeal of the revenue is dismissed

ITA 4900/MUM/2024[2017-18]Status: DisposedITAT Mumbai07 Apr 2025AY 2017-18

Bench: Shri Saktijit Dey & Shri Girish Agrawalassessment Year: 2017-18

For Appellant: Shri Rushabh Mehta, CAFor Respondent: Smt. Sanyogita Nagpal, CIT DR

Section 133Section 143(3)Section 145Section 68

second issue relation to addition made on account of gross profit estimation on understated sales. 8. On the first issue relating to addition u/s 68 towards share capital and premium from the aforesaid two parties, assessee could not furnish certain documents which were submitted at the first appellate stage

Income Tax Officer -19(2)(2), Mumbai vs. Mitesh Mehta HUF, Mumbai

In the result, appeal of the revenue is dismissed

ITA 2280/MUM/2024[2015]Status: DisposedITAT Mumbai07 Apr 2025

Bench: Shri Saktijit Dey & Shri Girish Agrawalassessment Year: 2015-16

For Appellant: Shri Mitesh Mehta, CAFor Respondent: Shri R. R. Makwana, Addl. CIT

Section 143(3)Section 68Section 69

scrutiny assessment and was assessed at total income of Rs.1,11,89,910/- by disallowing the claim u/s 10(38) and making addition u/s 68 towards sale consideration received on sale of shares of GCM and u/s 69C of commission @ 3% of Rs.2,97,549/- on the said sale consideration ... wing, without pinpointing anything specific towards assessee, in this regard. 4.3. Ld. Assessing Officer, thus completed the assessment by making an addition u/s 68 of the Act towards entire sale consideration of Rs. 6 Mitesh Mehta HUF, AY 2015-16 99,18,288/- received by the assessee on the transaction

Subramania Sreenivasa Ganeshanatha, Ruwi vs. Int Tax Ward 2(3)(1) Mumbai, Mumbai

Accordingly, Ground No.1 raised by the Revenue is dismissed

ITA 916/MUM/2025[2018-19]Status: DisposedITAT Mumbai04 Apr 2025AY 2018-19

Bench: Ms Padmavathy S, Am & Shri Raj Kumar Chauhan, Jm

For Appellant: Shri Hiran C. (Virtually Present)For Respondent: 02.04.2025

Section 10(38)Section 144C(13)Section 147Section 68Section 69ASection 69C

SAID IMPUGNED ORDER WAS TO BE DISMISSED? - HELD YES (Para 2) (in favour of assessee). 6. The Appellant submits and states that the addition u/s 68 of the Act and the addition of commission expenditure u/s 69C based on presumptions and sustainable as held by the ITAT Delhi

ACIT-4 2 1, Mumbai vs. Aspect Superstructure Pvt Ltd, Mumbai

In the result, both the appeals of the assessee and Revenue are dismissed

ITA 140/MUM/2025[2009-10]Status: DisposedITAT Mumbai04 Apr 2025AY 2009-10

Bench: Shri B.R. Baskaran & Shri Narender Kumar Choudhry

For Appellant: Shri Satyaprakash SinghFor Respondent: Shri Umesh Chandra Sinha

Section 131Section 133(6)Section 133ASection 142(1)Section 68

into four categories. Out of them, the Ld CIT(A) held that first three categories do not call for any addition u/s 68 of the Act. They are discussed below:- (a) There was a casting error of Rs.7,50,000/-. Hence the Ld CIT(A) granted relief to that extent ... fails to discharge the burden shifted to his shoulders, then the AO has to accept the cash credits and in that case, no addition u/s 68 of the Act could be made by the AO. In the instant case, we notice that the assessee has discharged the onus placed upon

Aspect Superstructures Private Limited, Mumbai vs. Asst. Commissioner of Income Tax-4(3)(2), Mumbai

In the result, both the appeals of the assessee and Revenue are dismissed

ITA 5947/MUM/2024[2009-10]Status: DisposedITAT Mumbai04 Apr 2025AY 2009-10

Bench: Shri B.R. Baskaran & Shri Narender Kumar Choudhry

For Appellant: Shri Satyaprakash SinghFor Respondent: Shri Umesh Chandra Sinha

Section 131Section 133(6)Section 133ASection 142(1)Section 68

Late Ramchandra Waman Khambete, Mumbai vs. I.T.O -42(3)(2), Mumbai

In the result, the appeal of the assessee stands allowed

ITA 5754/MUM/2024[2014-15]Status: DisposedITAT Mumbai04 Apr 2025AY 2014-15

Bench: Shri Om Prakash Kant () & Shri Rahul Chaudhary () Assessment Year: 2014-15 Ravindra Khambete Legal Heir Of Ito-42(3)(2), Late Ramchandra Waman Kautilya Bhavan, Bandra Vs. Khambete, Kurla Complex, Bandra (East), 103, Anuradha Building, Mumbai-400051. Amrutkumbh Sahaniwas, B.S. Road, Dadar, Mumbai-400028. Pan No. Adypk 9695 E Appellant Respondent

For Appellant: Mr. Kiran Unavekar, Sr. DRFor Respondent: Mr. Ashutosh Patare

Section 143Section 143(3)Section 144Section 147Section 56(2)(vii)Section 68

liability under normal provisions of the Act. Subsequently, it was liability under normal provisions of the Act. Subsequently, it was noticed that the addition u/s 68 of noticed that the addition u/s 68 of the Act should have been the Act should have been Late Ramchandra Waman Khambete Late Ramchandra

Dilip Kumar Hazarimal Ahuja, Mumbai vs. Income Tax Officer, Ward, 27(1), Mumbai

In the result, appeal of the assessee is allowed

ITA 2452/MUM/2024[2016-17]Status: DisposedITAT Mumbai04 Apr 2025AY 2016-17

Bench: Shri Amit Shukla & Shri Girish Agrawalassessment Year: 2016-17

For Appellant: Ms. Ritika Agarwal, AdvocateFor Respondent: Shri R.R. Makwana, Sr. DR

Section 10(38)Section 132Section 143(3)Section 147Section 148Section 153ASection 68

wing, without pinpointing anything specific towards assessee, in this regard. 4.2. Ld. Assessing Officer, thus completed the assessment by making an addition u/s 68 of the Act towards entire sale consideration of Rs. 50,91,646/- received by the assessee on the transaction of sale of shares in the aforesaid

Income Tax Officer, Ward-2(3)(1), Surat vs. Manidhara Realty LLP, Surat

In the result, the appeal of the Revenue is dismissed

ITA 327/SRT/2024[2017-18]Status: DisposedITAT Surat03 Apr 2025AY 2017-18

Bench: Shri Pawan Singh & Shri Bijayananda Prusethआयकर अपील सं./Ita No.327/Srt/2024 Assessment Year: (2017-18) (Physical Court Hearing) Income Tax Officer Manidhara Realty Llp बनाम/ Ward-2(3)(1), Surat Room 501, International Business Centre, Vs. No.614, Aayakar Bhawan, Dumas Road, Piplod, Surat-395 0017 Majura Gate, Surat-395001 "थायीलेखासं./जीआइआरसं./Pan/Gir No: Abcfm 2991 F (अपीलाथ"/Appellant) (""थ" /Respondent)

Section 143(2)Section 143(3)Section 250Section 68

stressed that the onus was on the assessee to establish the creditworthiness of the lenders, and in the absence of satisfactory evidence, the addition u/s 68 was justified. 5. On the hand, the learned Authorized Representative (AR) for the assessee strongly opposed the addition made by the AO and contended ... appellant as well as by relying on the decisions of Hon’ble jurisdictional High Court and ITAT. The AO made the addition u/s 68 on the premise that the assessee failed to establish the creditworthiness and genuineness of the transactions. However, we find that the assessee had submitted various details

Dy. Commissioner of Income Tax Central Circle-1(1), Nagpur vs. Shri Sanjay Gaurishankar Agrawal, Nagpur

ITA 109/NAG/2019[2014-15]Status: DisposedITAT Nagpur03 Apr 2025AY 2014-15

Bench: Shri V. Durga Rao & Shri K.M. Roy, Accountant, Member

For Appellant: Shri Kapil HiraniFor Respondent: Shri Sandipkumar Salunke

Section 10(38)Section 68

upon him U/s 68 of the I.T Act, 1961. The Appellant has satisfactorily proven the identity, creditworthiness and genuineness of the transaction. The addition U/s 68 thus deserves to be deleted on facts as well.  Moti Adhesives Pvt. Ltd. Vs. ITO (ITA No. 3133/Del/2018) 6.8. Reliance further placed on Umbrella

M/S. Bhushan Steel Ltd., New Delhi vs. ACIT, New Delhi

In the result, the appeal of the assessee for AY 2017-18 is partly allowed

ITA 1336/DEL/2016[2009-10]Status: DisposedITAT Delhi02 Apr 2025AY 2009-10

Bench: Shris.Rifaur Rahman & Shri Anubhav Sharma

For Appellant: Dr. Rakesh Gupta, AdvocateFor Respondent: Shri Dayainder Singh Sidhu, CIT DR

Section 132Section 143(2)Section 153A

abovesaid seven parties amounts to Rs.2,32,00,000/-. Since assessee has not submitted any details the AO proceeded to make the abovesaid addition u/s 68 of the Act and observed that onus lies on the assessee to explain the nature and sources of any sum credited in its books ... account. Since there is no material submitted by the assessee, he proceeded to make the addition u/s 68 of the Act to the extent of Rs.2,32,00,000/-. 18. Aggrieved assessee preferred an appeal before the ld. CIT (A) and submitted the detailed submissions. After considering the detailed submissions

Ritu Dhaka, Jaipur vs. ITO WD 4(4), Jpr, Jaipur

In the result, the appeal of the assessee is allowed

ITA 2/JPR/2025[2017-18]Status: DisposedITAT Jaipur01 Apr 2025AY 2017-18

Bench: Him. 2. In This Appeal, The Assessee Has Raised Following Grounds: -

For Appellant: Shri R.S. Poonia, C.AFor Respondent: Shri Gautam Singh Choudhary, JCIT

Section 143(3)Section 68

invoked the Section 68 for addition.? (iii) The Ld. A.O. has not issued any SCN that he is going to made addition u/s. 68 of the I.T. Act, 1961. (iv) The Ld. A.O. has not fulfilled the jurisdictional required to invoke Section 68 ... assessee has assailed on merits the additions sustained by the ld. CIT(A) In the result, appeal of the assessee is allowed.” The addition u/s. 68 is liable to be deleted. Ground No. 2 “That the Ld. A.O. has erred in Law & facts of the case in making addition without

Sudha Surana, New Delhi vs. I.T.O., Ward - 61(3), Kolkata

In the result, the appeal of the assessee is allowed

ITA 1372/KOL/2024[2015-2016]Status: DisposedITAT Kolkata01 Apr 2025AY 2015-2016

Bench: Shri Rajesh Kumar, Am & Shri Sonjoy Sarma, Jm Ito Ward-61(3) Bamboo Villa, Sudha Surana Central Revenue Building, C/O Kapil Goel, Advocate, 169, A.J.C. Bose Road, F-26/124, Sector 7, Rohini, Vs. New Delhi-110085 Kolkata-700014, West Bengal (Respondent) (Appellant) Pan No. Adepb5526F Assessee By : Dr. Kapil Goel, Ar Revenue By : Shri H. Robindro Singh, Dr Date Of Hearing: 06.02.2025 Date Of Pronouncement : 01.04.2025

For Appellant: Dr. Kapil Goel, ARFor Respondent: Shri H. Robindro Singh, DR

Section 142(1)Section 143Section 143(1)Section 143(2)Section 147Section 148Section 148(2)Section 151Section 68

filing the details/ evidences as called for by the ld. Assessing Officer. Finally, the ld. AO Sudha Surana; A.Y. 2015-16 made the addition u/s 68 of the Act on account of unexplained income/ credit of ₹90,45,180/-. 07. In the appellate proceedings, the ld. CIT (A) dismissed

Shanti Devi Kushwaha, Bharatpur vs. ACIT, Circle -4(2)(1), Farrukhabad

The appeal stand partly allowed as indicated upon conclusion of hearing

ITA 33/AGR/2024[2017-18]Status: HeardITAT Agra28 Mar 2025AY 2017-18

Bench: Hon’Ble Shri Satbeer Singh Godara, Jm & Hon’Ble Shri Manoj Kumar Aggarwal, Am आयकरअपीलसं./ Ita No. 33/Agr/2024 (िनधा"रणवष" / Assessment Year: 2017-18) Smt. Shanti Devi Kushwaha Acit-Circle-4(2)(1) बनाम/ C-162, Ranjeet Nagar Farukhabad Vs. Bharatpur, Rajasthan "थायीलेखासं./जीआइआरसं./Pan/Gir No.Dpbpk-5044-H (अपीलाथ"/Appellant) : (""थ" / Respondent) अपीलाथ"कीओरसे/ Appellant By : None ""थ"कीओरसे/Respondent By : Shri Shailendra Shrivastava – Ld. Sr. Dr सुनवाईकीतारीख/Date Of Hearing : 13-02-2025 घोषणाकीतारीख /Date Of Pronouncement : 28-03-2025 आदेश / O R D E R Manoj Kumar Aggarwal () 1. Aforesaid Appeal By Assessee For Assessment Year (Ay) 2017- 18 Arises Out Of The Order Of Learned Commissioner Of Income Tax (Appeals), Nfac [Cit(A)] Dated 27-12-2023 In The Matter Of An Assessment Framed By Ld. Ao On Best Judgment Basis U/S 144 Of The Act On 13-11-2019. At The Time Of Hearing, None Appeared For Assessee & Accordingly, The Appeal Was Proceeded With The Able Assistance Of Ld. Sr. Dr Who Pleaded For Dismissal Of The Appeal. 2. It Could Be Seen That The Assessment Has Been Framed On Best Judgment Basis. The Assessee Was Engaged In Civil Contract Work & It Failed To Produce Its Books Of Accounts Before Ld. Ao. Accordingly

For Appellant: NoneFor Respondent: Shri Shailendra Shrivastava – Ld. Sr. DR

Section 115BSection 144Section 68

books of accounts to substantiate its book results. Left with no option, lower authorities have rightly estimated the income of the assessee. The addition u/s 68 has been made considering the fact that the assessee could not substantiate the same. This addition could separately be made as per various judicial