“entry operator”

Cash Credits & Unexplained ItemsSection 68Section 682,071 judgments

The decision most relied on for entry operator is CIT v. Jamnadevi Agarwal (328 ITR 656), cited in 230 judgments on BharatTax.

Leading authorities on entry operator

CIT v. Jamnadevi Agarwal

328 ITR 656 · 2010 · High Court

230

citing judgments

When faced with allegations of bogus long-term capital gains from penny stocks, the Assessing Officer must discharge the onus of proving that the assessee's transactions were not genuine. The assessee can rely on the principle of preponderance of probability, and the Revenue must present substantial evidence to establish that the transactions were a colourable device or that the assessee was an entry operator.

ITO, 19(3) (4) Mumbai v. Shamim M Bharwani

69 Taxmann.com 65 · 2016 · Reported

142

citing judgments

Long Term Capital Gains (LTCG) from penny stock transactions are liable to be treated as bogus and added back under Section 68 as unexplained cash credits, especially when evidence suggests the involvement of entry operators providing accommodation entries.

5. PCIT v. Paramount Communication (P.) Ltd. Delhi High Court

392 ITR 444 · 2017 · High Court

111

citing judgments

For valid initiation of reassessment proceedings, the Assessing Officer must possess tangible material and apply independent mind to form a 'reason to believe' that income has escaped assessment. Reassessment cannot be based on mere borrowed satisfaction or unverified information without proper scrutiny.

2 CIT v. Indrajit Singh Suri

33 Taxmann.com 281 · 2013 · High Court

100

citing judgments

The validity of reassessment proceedings initiated under Sections 147/148 against legal representatives of a deceased assessee requires a demonstrable 'reason to believe' that income escaped assessment, often based on third-party information such as alleged accommodation entries.

Dharappa v. Bijapur Co-operative Milk Producers Societies Union Ltd.

9 SCC 109 · 2007 · Reported

citing judgments

When a State Act has obtained presidential assent, its repugnant provisions prevail over the provisions of a Central Act in that State, even if both laws relate to subjects in the Concurrent List. This principle was applied to determine repugnancy between the Karnataka Co-operative Societies Act, 1959, and the Industrial Disputes Act, 1947.

CIT v. Sanghamitra Bharali

361 ITR 481 · 2014 · High Court

citing judgments

Capital gains arising from sham transactions, particularly those involving penny stocks designed to appear genuine, are not exempt under Section 10(38) but are taxable as unaccounted income brought into the books.

CIT v. Active Traders (P.) Ltd.

214 ITR 583 · 1995 · High Court

citing judgments

When a sum is credited on account of share capital or share premium, the assessee must establish the existence, identity, genuineness, and creditworthiness of the share applicants, going beyond mere submission of documents. The Assessing Officer has the power to investigate and lift the corporate veil to ascertain the bonafides of such transactions.

Income Tax Vs. India Discount Co. Ltd. 75 ITR 191 (SC), Commissioner of Income Tax v. Provincial Farmers (P) Ltd.

245 ITR 421 · 2000 · Supreme Court

citing judgments

The entry in the books of accounts is not determinative of the true nature of a transaction for income tax purposes; the substance of the transaction, rather than its accounting treatment, governs its taxability and deductibility.

Judgments citing entry operator

Sneha Pawan Agarwal, Ahmedabad vs. ITO Ward 1(1)(3), Ahmedabad

The appeals are allowed for statistical purposes

ITA 1368/AHD/2025[2014-15]Status: DisposedITAT Ahmedabad16 Oct 2025AY 2014-15

Bench: Ms. Suchitra Raghunath Kamble & Makarand V.Mahadeokar

For Appellant: Shri Sulabh Padshah, ARFor Respondent: Shri Veerabadram Vislavath, Sr.DR

Section 144Section 144BSection 147Section 250Section 253(3)Section 253(5)

basis of information received from the Investigation Wing, Ahmedabad, which had conducted search and verification in the cases of the Tibrewal (entry operator) group and unearthed large-scale accommodation entries in the names of various shell entities. 3.2 In both years, the Assessing Officer recorded reasons to believe that income

DCIT, CC-2(3), Kolkata, Aayakar Bhawan Poorva vs. Maxcab Industries Pvt. Ltd., Kolkata

In the result, the appeal of the Revenue is dismissed

ITA 2590/KOL/2024[2021-22]Status: DisposedITAT Kolkata16 Oct 2025AY 2021-22

Bench: Shri Rajesh Kumar, Am & Shri Sonjoy Sarma, Jm Dcit, Central Circle-2(3), Maxcab Industries Pvt. Ltd. 4Th Floor, 110 Shantipally, 67/C, Balaram Dey Street, E.M. Bypass, Vs. West Bengal-700006 West Bengal-700107 (Appellant) (Respondent) Pan No. Aancm1997Q Assessee By : Shri Soumitra Choudhury & Ms. Nandini Surekh, Shri Pranabesh Sarkar, Ars Revenue By : Praveen Kishore, Dr Date Of Hearing: 04.09.2025 Date Of Pronouncement: 16.10.2025

For Appellant: Shri Soumitra Choudhury &For Respondent: Praveen Kishore, DR

Section 131Section 132(1)Section 133(6)Section 133ASection 143(1)Section 68

engaged in common the practice of routing its own unaccounted fund through shell entities in guise of unsecured loans with the help of various entry operators. During the assessment proceedings, the ld. AO noted that the assessee had borrowed during the year two unsecured loans

Assistant Commissioner of Income Tax, Central Circle-1(2), Kolkata vs. Somani Services Private Limited, Kolkata

ITA 2220/KOL/2024[2012-13]Status: DisposedITAT Kolkata16 Oct 2025AY 2012-13

Bench: the Hon'ble ITAT, Kolkata.

Section 143(3)Section 147Section 14ASection 250

transaction in shares of 'T' by assessee was a pre-arranged transaction in form of accommodation entry managed through collusive transactions by group of entry operators and shell entities - Whether, on facts, Tribunal committed an error in coming to a conclusion that Assessing Officer had not applied his mind

Assistant Commissioner of Income Tax, Central Circle-1(2), Kolkata vs. Somani Services Private Limited, Kolkata

ITA 2219/KOL/2024[2012-13]Status: DisposedITAT Kolkata16 Oct 2025AY 2012-13

Bench: the Hon'ble ITAT, Kolkata.

Section 143(3)Section 147Section 14ASection 250

Mukul Hasteer, Karnal vs. ITO Ward-1, Karnal

In the result, the assessee’s appeal is allowed for statistical purposes

ITA 96/DEL/2025[2018-19]Status: DisposedITAT Delhi15 Oct 2025AY 2018-19

Bench: Shri Challa Nagendra Prasad & Shri Avdhesh Kumar Mishra

Section 147Section 148Section 234A

account statement for F.Y 2017-18 has been filed by the assessee. Hence, it is evident that assessee has converted its unaccounted cash through entry operators controlled entity in his account as exempt long term capital gain from sale of Eicher Motor Limited, using the above modus operandi, where shares ... Penalty u/s 271AAC of the Act is initiated separately. (Addition: Rs. 1,61,400/-) Further, since the assessee has made payment as commission to entry operator to make arranged transaction to bring unaccounted income in his books without paying any tax on it, therefore

Income Tax Officer, Delhi vs. Mohd Rizwan, Delhi

ITA 3535/DEL/2025[2021-22]Status: DisposedITAT Delhi15 Oct 2025AY 2021-22

Bench: Shri S. Rifaur Rahman & Shri Yogesh Kumar U.S.Income Tax Officer, Delhi. (Appellant)

For Appellant: NoneFor Respondent: Shri Abhijeet Kumar, Sr. DR

Section 144Section 80C

provided to the appellant. With regard to comments in column number (7), the supplier mentioned at sl. no.12 was found to be an entry-operator by ADIT (Inv.) but no independent investigation was carried out by the AO and he relied on the report of ADIT(Inv) and that ... sales are concerned. For example, in the case of supplier mentioned at sl.no.1 of the Table, he was not found an entry-operator, he was not found unavailable as notice was served, and he did not deny the sales but the purchases from him were found doubtful

Raghav Kumar, New Delhi vs. ACIT Central Circle-29, New Delhi

In the result, the appeal filed by the assessee being ITA

ITA 3215/DEL/2025[2021-22]Status: DisposedITAT Delhi15 Oct 2025AY 2021-22

Bench: Shri Satbeer Singh Godara & Shri S. Rifaur Rahman

For Appellant: Shri R.S. Singhvi, AdvocateFor Respondent: Shri Dayainder Singh Sidhu, CIT DR

Section 132Section 153CSection 69Section 69A

against this group was that it had taken a large number of accommodation entries in its various group companies by paying cash to several entry operators - Thus, after recording a satisfaction note, a notice under section 153C was issued against assessee - Subsequently, an assessment order was passed under section 153/143

Raghav Kumar, Delhi vs. ACIT Central Circle 29, New Delhi

In the result, the appeal filed by the assessee being ITA

ITA 3214/DEL/2025[2020-21]Status: DisposedITAT Delhi15 Oct 2025AY 2020-21

Bench: Shri Satbeer Singh Godara & Shri S. Rifaur Rahman

For Appellant: Shri R.S. Singhvi, AdvocateFor Respondent: Shri Dayainder Singh Sidhu, CIT DR

Section 132Section 153CSection 69Section 69A

Park View Automotive P.Ltd, New Delhi vs. ITO, Ward-19(3), New Delhi

The appeal of the assessee is allowed

ITA 1159/DEL/2018[2010-11]Status: DisposedITAT Delhi15 Oct 2025AY 2010-11

Bench: SHRI ANUBHAV SHARMA (Judicial Member), SHRI AMITABH SHUKLA (Accountant Member)

For Appellant: Dr. Rakesh Gupta, Advocate &For Respondent: Ms Harpreet Kaur Hansra, Sr. DR

Section 143(1)Section 147

same have not been examined to point out as to how they show that assessee was part of larger manipulation of entry operators and modus operandi noted by the investigation wing. 8. Then, there is justification in the contention of the ld. counsel that as 15000 shares only were sold

B D Cotton Association, Mumbai vs. Income Tax Officer. Ward 19(1)(2), Mumbai

Appeal of the assessee is allowed

ITA 1216/MUM/2024[2012-13]Status: DisposedITAT Mumbai14 Oct 2025AY 2012-13

Bench: Shri Amit Shukla, Jm & Ms Padmavathy S, Am

For Appellant: Shri Aseem Thakkar

Section 147Section 148Section 250Section 68

proved the identity, creditworthiness and genuineness of the transaction since the AO has established the chain of transactions carried out to the entry operators. The ld. DR also submitted that when the immediate source of the loan taken from M/s Omrim Security Ltd. is not properly substantiated then

M/S Ankur Developers & Realtors, Mumbai vs. DCIT CC-3(4), Mumbai

In the result, the appeal of the assessee is rejected

ITA 428/MUM/2020[2014-15]Status: DisposedITAT Mumbai14 Oct 2025AY 2014-15

Bench: Shri Om Prakash Kant () & Shri Raj Kumar Chauhan () Assessment Year: 2014-15

For Appellant: NoneFor Respondent: Mr. Surendra Mohan, Sr. DR

Section 131Section 132Section 68

Reliance was also placed on the findings of search action carried out in the case of Shri Praveen Jain, a well-known accommodation entry operator, who had admitted under oath that he controlled a web of entities exclusively engaged in providing bogus loans, share application money and sales entries ... under section 132(4), recorded on 24.03.2014, was a categorical admission of having availed accommodation entries in the form of unsecured loans from several entry operators. The search had revealed the absence of any formal documentation such as loan agreements, security details, or repayment terms. Shri Dinesh V. Shah

DCIT, Circle- 19(1), Delhi vs. P & R Engineering Services Pvt. Ltd., Delhi

In the result, appeal of the revenue is dismissed

ITA 6058/DEL/2024[2010-11]Status: DisposedITAT Delhi14 Oct 2025AY 2010-11

Bench: Shri Yogesh Kumar U.S & Shri Manish Agarwal[Assessment Year : 2010-11] Vs P& R Engineering Services Dcit, Circle-19(1), Pvt.Ltd., 89, Lok Nayak New Delhi Apartments, Sector-9, Rohini, Delhi-110085. Pan-Aaccp0484E Appellant Respondent Revenue By Shri Sanjeev Kumar Yadav, Cit Dr Assessee By Shri V. K.Agarwal, Ar Date Of Hearing 17.07.2025 Date Of Pronouncement 14.10.2025 Order Per Manish Agarwal, Am : This Appeal Is Filed By The Revenue Against The Order Of The Commissioner Of Income Tax (Appeals), Delhi -31 [Cit(A), In Short] Dated 01.11.2024 In Appeal No. Cit(A), Delhi-7/10212/2017-18 Arising Out Of The Order Passed U/S 147 R.W.S. 143(3) Of The Income Tax Act, 1961 [The Act, In Short] For A.Y. 2010-11. 2. Brief Facts Of The Case Are That Assessee Is A Company & Filed Its Return Of Income On 27.09.2010, Declaring Loss Of Rs. 12,89,624/-. The Case Of The Assessee Was Reopened In Terms Of The Notice Issued U/S 148 Of The Act On 30.09.2017. In Response, The Assessee Has Declared The Same Income As Was Declared In The Return Filed U/S 139(1) Of The Act. Thereafter The Ao By Alleging That The Assessee Has Received Share Application Money Of Rs. 8,28,45,000/- From Three Companies Namely, M/S Mansarovar Holdings Ltd. Rs. 4,09,00,000/-, M/S Olipha Trading & Investment Pvt. Ltd. Of Rs. 3,27,10,000/- & From M/S Sopan Merchants Pvt. Ltd. Of Rs. 92,35,000/- Which Companies Are Paper Companies & Made The Addition U/S 68 Of The Act Of The Entire Amount Of Loan Received From These Three Companies.

Section 139(1)Section 147Section 148Section 68

Builders (India) Ltd. 11. With regard to the statement of Sh. Pankaj Agarwal, who is controlling M/s Sopan Merchants Pvt. Ltd. The entry operator has been investigated by Investigation Wing, Kolkata and has admitted on oath that he is in the business of providing accommodation entries to various beneficiaries ... assessment order, the AO noted that the party from whom the Appellant has received funds was none other than the entry operator and the amount introduced through it is nothing but the Appellant's own income from undisclosed sources. From the perusal of financials of the aforesaid three companies

Rms Karamchari Bachat and Sakh Sahakari Samiti Limited Jaipur, Jaipur vs. ITO Ward-1(2), Jaipur

In the result, the appeals of the assessee are allowed

ITA 246/JPR/2025[2016-17]Status: DisposedITAT Jaipur13 Oct 2025AY 2016-17

For Appellant: Shri Deepak Sharma, C.AFor Respondent: Smt. Anita Rinesh, JCIT

Section 144Section 147Section 250

Assessee had taken after paying unaccounted cash to the accommodation entry given(sic giver)". The AO adds that the said accommodation was "a known entry operator" the source being "the report of the Investigation Wing". 21. The third and last part contains the conclusion drawn by the AO that ... basis for which is not disclosed. Who is the accommodation entry giver is not mentioned. How he can be said to be "a known entry operator" is even more mysterious. Clearly the source for all these conclusions, one after the other, is the Investigation report of the DIT. Nothing from

Rms Karamchari Bachat and Sakh Sahakari Samiti Limited Jaipur, Jaipur vs. ITO Ward-1(2), Jaipur

In the result, the appeals of the assessee are allowed

ITA 245/JPR/2025[2015-16]Status: DisposedITAT Jaipur13 Oct 2025AY 2015-16

For Appellant: Shri Deepak Sharma, C.AFor Respondent: Smt. Anita Rinesh, JCIT

Section 144Section 147Section 250

Rms Karamchari Bachat and Sakh Sahakari Samiti Limited Jaipur, Jaipur vs. ITO, Ward-1(2), Jaipur

In the result, the appeals of the assessee are allowed

ITA 244/JPR/2025[2014-15]Status: DisposedITAT Jaipur13 Oct 2025AY 2014-15

For Appellant: Shri Deepak Sharma, C.AFor Respondent: Smt. Anita Rinesh, JCIT

Section 144Section 147Section 250

Rms Karamchari Bachat and Sakh Sahakari Samiti Limited Jaipur, Jaipur vs. ITO Ward-1(2), Jaipur

In the result, the appeals of the assessee are allowed

ITA 243/JPR/2025[2013-14]Status: DisposedITAT Jaipur13 Oct 2025AY 2013-14

For Appellant: Shri Deepak Sharma, C.AFor Respondent: Smt. Anita Rinesh, JCIT

Section 144Section 147Section 250

Deputy Commissioner of Income Tax, Central Circle-4(4), Kolkata vs. Flex Trade Private Limited, Kolkata

In the result, the appeal of the revenue is dismissed

ITA 1828/KOL/2024[2018-19]Status: DisposedITAT Kolkata13 Oct 2025AY 2018-19

Bench: Shri Rajesh Kumar&Shri Pradip Kumar Choubey]

Section 131Section 139(1)Section 143(2)Section 143(3)Section 147Section 148Section 148ASection 68

without no actual movement of goods and the group was controlled and managed by Shri. Rajesh G. Mehta who is one of the famous entry operators of Kolkata. The said information was unearthed by the investigation wing, Kolkata in pursuant to a search operation. Post search enquiry had also revealed

Devang Bhupendra Shah, Mumbai vs. Income Tax Officer 32(1)(4), Mumbai

In the result, the appeal of the assessee is allowed

ITA 4218/MUM/2023[2014-15]Status: DisposedITAT Mumbai13 Oct 2025AY 2014-15

Bench: Shri Sandeep Gosain & Shri Prabhash Shankardevang Bhupendra Shah, V/S. Income Tax Officer, Ward – B/9, Neminath Apt., बनाम 32(1)(4), Kautilya Bhavan, Shimpoli Road, Borivali Bandra Kurla Complex, West, Mumbai – 400 092, Bandra (East), Mumbai– Maharashtra 400051, Maharashtra स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aadps1211L Appellant/अपीलार्थी .. Respondent/प्रतिवादी

For Appellant: Shri Rahul Kapadia,ARFor Respondent: Shri Annavaran Kasuri, (Sr. AR)

Section 10(38)Section 143(3)Section 68Section 69C

Pratap Uttam Purohit rejected assessee's plea and made additions under sections 68 and 69 by relying on statements from 'entry operators' - On appeal. Commissioner (Appeals) accepted assessee's claim, noting that shares were purchased via Account Payee Cheques, held in a Demat Account for over 12 months, and sold ... transaction tax Tribunal upheld Commissioner (Appeal)'s decision. emphasizing assessee's right to correct mistakes and criticized Assessing Officer's reliance on statements from 'entry operators to support additions under sections 68 and 69 as those statements were recorded in unrelated proceedings before survey on assessee. and assessee

Deepak Vohra, Delhi vs. DCIT, Central Circle-29, Delhi

ITA 824/DEL/2024[2014-15]Status: DisposedITAT Delhi13 Oct 2025AY 2014-15

Bench: Shri Satbeer Singh Godara & Shri Manish Agarwal

Section 131Section 147Section 69A

oath. The fact, however, remains that once the 14 | P a g e ITA Nos.824 & 1054/Del/2024 assessee has been found as a hawala entry operator; the Revenue’s stand to assess him for the entire volume of transactions than the profit element, only does not deserve to be accepted. This

Deepak Vohra, Delhi vs. Assist. CIT, CC- 29, New Delhi

ITA 1054/DEL/2024[2015-16]Status: DisposedITAT Delhi13 Oct 2025AY 2015-16

Bench: Shri Satbeer Singh Godara & Shri Manish Agarwal

Section 131Section 147Section 69A