“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

DCIT, Circle-13(1), New Delhi vs. Janpath Ventures Pvt.Ltd., New Delhi

In the result, appeal of the Revenue is allowed for statistical purposes

ITA 9015/DEL/2019[2015-16]Status: DisposedITAT Delhi17 May 2024AY 2015-16

Bench: Shri Pradip Kumar Kedia & Shri Yogesh Kumar Us

For Appellant: Shri Sunny Mittal, Chartered AccountantFor Respondent: Mr. Waseem Arshad, CIT (DR)

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

report received by the CIT(A) from the AO reads as under: “In this regard, it is submitted that the AO has made addition u/s 68 of the IT Act. The addition was made on account of unexplained share application money credited in the books of account of M/s. Janpath

M/S Jain Amar Clothing Pvt. Ltd., Ludhiana vs. DCIT, CC-III, Ludhiana

In the result, the ground no

ITA 374/CHANDI/2023[2012-13]Status: DisposedITAT Chandigarh16 May 2024AY 2012-13

Bench: SHRI. AAKASH DEEP JAIN (Vice President), SHRI. VIKRAM SINGH YADAV (Accountant Member)

For Appellant: Shri Sudhir Sehgal, AdvocateFor Respondent: Shri Rohit Sharma, CIT DR

Section 143(3)Section 153ASection 263Section 68

thus, the identity, creditworthiness and genuineness of transaction stood proved and, thus, addition as made u/s 68 is uncalled for. 8. That no addition u/s 68 is called for as per the provisions of section 68 as it stood during the year under consideration as the change was brought ... section from the Asstt. Year 2013-14 and hence the CIT(A) has erred in making the addition u/s 68. 9. That the Ld. CIT(A)has failed to appreciate that even the proceedings u/s 263 were initiated by the Ld. PCIT in the case of assessee company in respect

Synergy Infrastructures, Mumbai vs. Deputy Commissioner of Income Tax, Cir-42(1)(1), Mumbai

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

ITA 4108/MUM/2023[2013-14]Status: DisposedITAT Mumbai15 May 2024AY 2013-14

Bench: Justice (Retd.) C V Bhadang, Hon’Ble& Shri B.R. Baskaranassessment Year 2012-13 Assessment Year 2013-14

For Appellant: Shri Shreyash Shah &For Respondent: Shri Suresh D. Gaikwad, Sr.AR

Section 133ASection 143(3)Section 147Section 68Section 69C

Year 2013-14 relevant to AY 2012-13 and 2013-14. Accordingly, the Ld A.R submitted that the AO could not have made addition u/s 68 of the Act in respect of an imaginary loan. In this regard, the Ld A.R invited our attention to the financial statements placed ... assessee. 8. If the assessee has not taken loan from M/s Nikhil Gems P Ltd, then there was no requirement of making any addition u/s 68 of the Act, since the said section will apply only to the cash credits actually received. However, it is not discernible from the assessment

M/S Synergy Infrastructures, Mumbai vs. DCIT, Cir-42(1)(1)

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

ITA 4107/MUM/2023[2012-13]Status: DisposedITAT Mumbai15 May 2024AY 2012-13

Bench: Justice (Retd.) C V Bhadang, Hon’Ble& Shri B.R. Baskaranassessment Year 2012-13 Assessment Year 2013-14

For Appellant: Shri Shreyash Shah &For Respondent: Shri Suresh D. Gaikwad, Sr.AR

Section 133ASection 143(3)Section 147Section 68Section 69C

Gagandeep Singh, Rohtak vs. ITO, Ward-2, Rohtak

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

ITA 883/DEL/2024[2011-12]Status: DisposedITAT Delhi15 May 2024AY 2011-12

Bench: him, therefore, proceeded to make the assessment u/s 143(3) r. w. section 147 of the Act, 1961 (‘the Act' for short). Further, he agreed that several opportunities were given by the Ld. CIT(A) as well and assessee could not represent his case due to non-receipt of the notices, however, he submitted that the Ld. CIT(A) has proceeded to dismiss the appeal filed by the assessee in limine without deciding the issue on merits. He prayed that this issue may be remitted back to file of Ld. CIT(A)

Section 143(3)Section 147Section 68Section 69

That the Ld. CIT(A) has erred in law and on facts by directing the Ld. AO to make the addition u/s 68 of the Act in order to rectify the error of the Ld. AO in appreciating the fact that there was no LTCG earned by the assessee

DCIT Central Circle-13, Jhandewalan New Delhi vs. Magic Auto Pvt Ltd., New Delhi

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

ITA 2152/DEL/2023[2017-18]Status: DisposedITAT Delhi15 May 2024AY 2017-18

Bench: Shri Saktijit Dey & Shri Naveen Chandra

For Appellant: Shri Salil Kapoor, AdvFor Respondent: Shri Rajesh Kumar Dhaneshta, Sr. DR

Section 145(3)Section 68

automobile industry and hence the increased revenue. 17. The ld. counsel for the assessee contended that the Assessing Officer while making the impugned addition u/s 68 of the Act and rejecting the explanation offered by the Assessee with respect to the nature and source of cash deposited in various bank ... that when Assessee ITA No.541/Bang/2021 Page 8 of 8 already admitted the sales as revenue receipt, there is no case for making the addition u/s 68 or tax the same u/s 115BBE again. I am of the view that in the light of the facts and circumstances of the present

M/S Devbhumi Vinimay Pvt. Ltd., Kolkata vs. DCIT, Cir. 5(1), Kolkata

In the result, appeal of the assessee is allowed

ITA 1393/KOL/2023[2012-13]Status: DisposedITAT Kolkata14 May 2024AY 2012-13

Bench: DR. MANISH BORAD, HON’BLE (Accountant Member), SHRI SANJAY GARG, HON’BLE (Judicial Member)

For Appellant: Shri Sunil Surana, A/RFor Respondent: Shri Sanjay Paul, Addl. CIT, D/R

Section 131Section 143(2)Section 143(3)Section 250Section 68

statements and that the, assessee had failed to explain the nature and source of the alleged sum and thus, concluded the proceedings making addition u/s 68 of the Act at Rs.1,49,10,000/- and assessed the income at Rs. 1,49,05,460/-. 3 I.T.A. No. 1393/Kol/2023 Assessment Year

Prathamik Krishi Pattin Sahakari Sangh Niyamit Mareguddi, Bagalkot vs. Income-Tax Officer, Ward-1 & Tps, Bagalkote

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

ITA 259/BANG/2024[2020-21]Status: DisposedITAT Bangalore14 May 2024AY 2020-21

Bench: Shri. Narender Kumar Choudhry & Shri. Laxmi Prasad Sahuassessment Year : 2020-21 M/S. Prathamik Krishi Pattin Sahakari Ito, Sangh Niyamit Mareguddi, Ward – 1 & Tps, Cts Pkps Sangh Niyamit, Mareguddi, Vs. Bagalkote. Jamkhandi Bagalkot – 587 301. Pan : Aaaap 6078 N Appellant Respondent Assessee By : Shri. Saidappa B. Gadadi, Ca Revenue By : Shri. G. Manoj Kumar, Cit(Dr)(Itat), Bengaluru. Date Of Hearing : 20.03.2024 Date Of Pronouncement : 14.05.2024

For Appellant: Shri. Saidappa B. Gadadi, CAFor Respondent: Shri. G. Manoj Kumar, CIT(DR)(ITAT), Bengaluru

Section 133(6)Section 44ASection 68Section 80P

owing to unawareness about the e- assessment and appeal procedures by the earlier council. 6. That the learned faceless assessing authority made the addition u/s 68 of the act the deposits of members and the provisions even though he was aware how the society functions and what are documents societies

Shree Jagadguru Mouneshwar Pattin Sahakari Sangh Niyamit Kerur, Bagalkot, Karnataka vs. Income Tax Officer, Ward 1, Bagalkot

In the result, the appeal of the assessee is partly allowed for

ITA 1119/BANG/2023[2017-18]Status: DisposedITAT Bangalore14 May 2024AY 2017-18

Bench: Shri Narender Kumar Choudhry & Shri Laxmi Prasad Sahu

For Appellant: Shri Prasanna N. Urala, AdvocateFor Respondent: Shri Ganesh R. Ghale, Standing Counsel

Section 115BSection 139(4)Section 142(1)Section 68Section 80A(5)Section 80P

Govt. of India dated 08.11.2016 the assessee was not authorised to accept cash deposits in SBNs and the AO had made addition u/s. 68. We note that the assessee has filed details of cash deposits from members in their accounts with society along with KYC details and assessee has discharged ... observing that the impugned amount should be treated as income of the assessee u/s 69A of the Act., however the AO made addition u/s 68 of the I.T. Act. The assessee has satisfied the requirement of section 69A of the Act and the AO did not give further opportunity

Mangaldeep Multistate Urban Co.Op.Cr. Soc. Ltd., Kolkatta vs. ACIT - CC- 2 (1), Mumbai

In the result, the appeal by the assessee for the assessment year 2014-

ITA 2150/MUM/2022[2016-17]Status: DisposedITAT Mumbai13 May 2024AY 2016-17

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: Shri Prasad KulkarniFor Respondent: Smt. Sanyogita Nagpal

Section 13Section 147Section 151Section 250Section 68

assessee in the present appeal is against the invocation of proceeding u/s 147 of the Act as well as the confirmation of addition u/s 68 of the Act. 6. The brief facts of the case as emanating from the record, are: The assessee is a registered Co-operative Society under ... granted the opportunity to respond to any information/documents relied upon by the AO. Accordingly, the findings in the impugned order pertaining to addition u/s 68 of the Act as well as addition on account of commission income are set aside and grounds no. 5- 7, raised in assessee’s appeal

Mangaldeep Multistate Urban Co.Op.Cr. Soc. Ltd., Mumbai vs. ACIT - CC- 2 (1), Mumbai

ITA 2149/MUM/2022[2014-15]Status: DisposedITAT Mumbai13 May 2024AY 2014-15

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: Shri Prasad KulkarniFor Respondent: Smt. Sanyogita Nagpal

Section 132Section 133ASection 139(1)Section 147Section 151Section 250Section 68

Mangaldeep Multistate Urban Cooperative Credit Society Ltd, Mumbai vs. ACIT, CC 2(1), Mumbai

In the result, the appeal by the assessee for the assessment year 2014-

ITA 2138/MUM/2022[2015-2016]Status: DisposedITAT Mumbai13 May 2024AY 2015-2016

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: Shri Prasad KulkarniFor Respondent: Smt. Sanyogita Nagpal

Section 13Section 147Section 151Section 250Section 68

Malvi and Co., Ahmedabad vs. The Income Tax Officer, Ward-5(3)(5), Ahmedabad

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

ITA 658/AHD/2023[2017-18]Status: DisposedITAT Ahmedabad10 May 2024AY 2017-18

Bench: Shri Waseem Ahmed (Accountant Member), Shri T.R. Senthil Kumar (Judicial Member)

Section 133(6)Section 143(3)Section 155BSection 68

given, onus shifts from assessee to revenue. In absence of anything contradictory brought on the table, it wouldn't be fair to confirm addition u/s 68 of the Act. Gujarat High Court went on to the extent of confirming that even if creditors didn't turn up on issue

Bhoomivikas Construction Pvt. Ltd., Mumbai vs. DCIT, Cir-6(1)(2)

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

ITA 4487/MUM/2023[2012-13]Status: DisposedITAT Mumbai10 May 2024AY 2012-13

Bench: Shri Pavan Kumar Gadale & Ms Padmavathy S

Section 143(3)Section 68

site portal whereas the amount received from other party i.e. Jeevan Sundar Property Developers LLP was not pertaining to the relevant year, therefore addition u/s 68 of the Act is not justified. 3 ITA. No. 4487/MUM/2023 (A.Y.: 2012-13) Bhoomivikas construction Pvt Ltd, Mumbai . 5. The Assessee company consisted

Namokar Builders Pvt. Ltd., Kolkata vs. D.C.I.T., Central Circle -2(1), Kolkata

In the result, the appeal of the assessee is allowed

ITA 762/KOL/2022[2013-2014]Status: DisposedITAT Kolkata09 May 2024AY 2013-2014

Bench: Shri Rajpal Yadav & Shri Rajesh Kumar, Am]

Section 131Section 133ASection 143(1)Section 143(3)

Assessing Officer in treating their Long Term Capital Gains from transaction in shares of Radford Global Ltd as bogus and making addition u/s 68 of the Act. 22. Regarding the report of SEBI report dated 19.12.2014 we find that the said order was revoked by SEBI by the final order ... stock exchange and demat accounts and also it has been claimed that in one case there is a loss and there is no addition u/s 68 of the Act but without going into the merits of the case even on legal ground itself, we, in view settled judicial procedure referred

Aabhushan, Dhamnod, Madhya Pradesh vs. ITO Dhar, Dhar

In the result, appeal of the assessee is allowed

ITA 344/IND/2023[AY 2017-18]Status: DisposedITAT Indore09 May 2024

Bench: Shri Vijay Pal Rao & Shri B.M. Biyaniaabhushan Dhamnod Ito, Dhar 1St Floor, Ganpati Market Ab Road Dhamnod Vs. Mp (Appellant / Assessee) (Respondent/ Revenue) Pan: Abgfa0812K Assessee By Shri Pranay Goyal & Shri S.N. Goyal, Ars Revenue By Shri Ashish Porwal, Sr. Dr Date Of Hearing 10.04.2024 Date Of Pronouncement 09.05.2024 O R D E R

Section 115BSection 142(1)Section 143(2)Section 68

submission made by the appellant in which proper explanation was furnished. 4. That, the Hon'ble CIT(A) has erred to confirm the addition u/s 68 of the Act made by Ld. AO on account of capital introduced of Rs. 2,00,54,089/- by partners in the firm without ... creditors beyond all doubts by producing all the necessary documentary evidences. 6. That, the Hon'ble CIT(A) has erred to confirm the addition u/s 68 of the Act made by Ld. AO on account of the outstanding expenses of Rs. 1,17,267/- on account of salary payable

Income Tax Officer Ward 51(1), Civic Centre vs. Aditi Gems N Jewellery, Karol Bagh Delhi

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

ITA 3748/DEL/2023[2017-18]Status: DisposedITAT Delhi09 May 2024AY 2017-18

Bench: Shri Shamim Yahya & Shri Sudhir Pareekito, Ward 51 (1), Vs. Aditi Gems N Jewellery, Delhi. 29/3250, Beadonpura, Karol Bagh, Delhi – 110 005. (Pan : Aanfs3291Q) (Appellant) (Respondent) Assessee By : Shri R.S. Singhvi, Ca Shri Satyjeet Goyal, Ca Revenue By : Shri Amit Katoch, Sr. Dr Date Of Hearing : 02.05.2024 Date Of Order : 09.05.2024 Order Per Shamim Yahya: This Appeal By The Revenue Is Directed Against The Order Of The Ld. Cit (Appeals)/National Faceless Appeal Centre (Nfac) Dated 06.11.2023 For The Assessment Year 2017-18. 2. Grounds Of Appeal Taken By The Assessee Read As Under :- “1. Whether On The Facts & Circumstances Of The Case, The Ld. Cit (A) Erred In Deleting The Additions Of Rs.2,74,01,660/- Made By Ao U/S 68 Of The Income Tax Act, 1961. 2. Whether On The Facts & Under The Circumstances Of The Case, The Ld. Cit (A) Is Justified In Holding That The Evidence Collected By The Ao During The Assessment Proceeding Were Merely Conjecture & Surmise

For Appellant: Shri R.S. Singhvi, CAFor Respondent: Shri Amit Katoch, Sr. DR

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

absence of any adverse finding with respect to the acceptability/veracity of books of account, the action of AO cannot be sustained. Making an addition u/s 68 of an amount, which is already accounted for as sales would be tantamount to double addition. The appellant has established existence of adequate stock

ITO, New Delhi vs. Sh. Avtar Singh, Gurgaon

Appeal is allowed for statistical purpose

ITA 2592/DEL/2017[2012-13]Status: DisposedITAT Delhi09 May 2024AY 2012-13

Bench: or during the course of the hearing of the appeal.”

For Respondent: “1. The Ld. CIT(A) erred in deleting the addition of Rs.1,79,84

Section 143(2)Section 144Section 145(3)Section 68

profit shown with the corresponding books of accounts/ details. (Para 4.2 of CIT(A), Page- 5). However, the CIT(A) deleted the addition u/s 68 by holding that when account books are rejected, it would follow, as necessary corollary, that entries in the account books whether suspicious or not cannot

Tirumala Irons (P) Ltd, Kolkata vs. ITO, Ward-4(1), Kolkata

In the result, appeal of the assessee is partly allowed

ITA 993/KOL/2023[2012-13]Status: DisposedITAT Kolkata08 May 2024AY 2012-13

Bench: Dr. Manish Borad, Hon’Ble & Shri Sonjoy Sarma, Hon’Blei.T.A. No. 993/Kol/2023 Assessment Year: 2012-13 Tirumala Irons (P) Ltd. Income Tax Officer, Ward – 4(1), Subash Agarwal & Associates, Vs Kolkata /Assessing Officer, Nfac, Delhi Advocates Siddha Gibson 1, Gibson Lane Suite 213, 2Nd Floor Kolkata - 700069 [Pan : Aaact9984H] अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Shri Siddharth Agarwal, Advocate Revenue By : Shri Rakesh Kumar Das, Cit, D/R सुनवाई क" तारीख/Date Of Hearing : 09/04/2024 घोषणा क" तारीख /Date Of Pronouncement: 08/05/2024 आदेश/O R D E R Per Dr. Manish Borad: The Present Appeal Is Directed At The Instance Of The Assessee Against The Order Of The Learned Commissioner Of Income Tax (Appeals) (Hereinafter The “Ld. First Appellate Authority”) Dt. 27/07/2023, Passed U/S 250 Of The Income Tax Act, 1961 (“The Act”) For The Assessment Year 2012-13. 2. The Assessee Has Raised The Following Grounds Of Appeal:- “1. For That The Ld. Cit(A) Was Not Justified In Passing The Order Exparte Without Affording Reasonable Opportunity Of Hearing. 2. For That The Ld. Cit (A) Was Not Justified In Confirming The Addition Of Rs. 4,81,00,000/- Made By The A.O. On Account Of Share Capital Including Share Premium By Wrongly Applying The Decision Of Hon'Ble Supreme Court In The Case Of Cit Vs. T.V. Sundaram Iyenger & Sons Ltd. 222 Itr 344. 2

For Appellant: Shri Siddharth Agarwal, AdvocateFor Respondent: Shri Rakesh Kumar Das, CIT, D/R

Section 131Section 143(2)Section 14ASection 250Section 68

proceeded to dispose off the case ex-parte. 4. Now, the assessee is in appeal before this Tribunal. 5. So far as the addition u/s 68 of the Act is concerned, it was submitted that the assessee company has not received the alleged sum during the year. Referring

Barbarian Power Gym Pvt Ltd, Mumbai vs. ITO Ward - 9 (2)(1), Mumbai

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

ITA 4268/MUM/2023[2014 - 15]Status: DisposedITAT Mumbai08 May 2024

Bench: Shri Pavan Kumar Gadale & Ms Padmavathy S

Section 133(6)Section 40Section 68

Delhi, (NFAC)/ CIT(A) against the order u/sec143(3) and u/sec250 of the Act. The assessee has raised the following grounds of appeal: Addition u/s 68 of the Act Rs. 28,09,000/- 1. The learned CIT(A) erred in upholding the addition of Rs. 28,09,000/- u/s 68