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“genuineness of the transaction”

Cash Credits & Unexplained ItemsSection 68Section 685,938 judgments

The decision most relied on for genuineness of the transaction is Sumati Dayal v. CIT (214 ITR 801), cited in 1,967 judgments on BharatTax.

Leading authorities on genuineness of the transaction

Sumati Dayal v. CIT
214 ITR 801 · 1995 · Supreme Court
1,967
citing judgments

The Revenue is entitled to look behind the apparent form of a transaction to discover its true nature, applying the test of human probabilities and surrounding circumstances. If transactions defy logic or are unnatural, they can be treated as bogus, even if supported by some documentation, especially in cases of cash credits or unexplained investments.

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. Orissa Corporation Pvt. Ltd.
159 ITR 78 · 1986 · Supreme Court
897
citing judgments

When an assessee provides the identity and address of a creditor or investor for a cash credit or share capital under Section 68, the burden shifts to the Department to establish lack of genuineness or creditworthiness, requiring it to conduct further inquiries; mere non-compliance by third parties to summons cannot be the sole basis for an adverse inference against the assessee.

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.

McDowell & Co. Ltd. v. CTO
154 ITR 148 · 1985 · Supreme Court
741
citing judgments

The Supreme Court held that while legitimate tax planning is permissible, transactions structured as a "colourable device" or "subterfuge" solely to avoid tax are impermissible. It mandates a judicial shift to look beyond the form to the substance of a transaction, allowing the lifting of the corporate veil in tax evasion arrangements.

(Central)-1 v. NRA Iron & Steel (P) Ltd.
103 Taxmann.com 48 · 2019 · Supreme Court
696
citing judgments

When assessing cash credits, share capital, or loans, the assessee bears the onus to prove the identity, creditworthiness, and genuineness of transactions. This burden is not discharged merely by documentary evidence if field inquiries reveal accommodation entries or dealings with paper/shell companies.

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.

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.

Judgments citing genuineness of the transaction

Growmore Research and Assets Management Ltd, Mumbai vs. DCIT, Central Circle -4(3), Mumbai

In the result, appeal of the assessee is allowed

ITA 5020/MUM/2024[1993-94]Status: DisposedITAT Mumbai12 Mar 2025AY 1993-94

Bench: Shri Saktijit Dey, Hon’Ble & Shri Narendra Kumar Billaiya, Hon’Ble

For Appellant: Shri Vijay Mehta, C.A. & Shri Tarang Mehta- AdvocateFor Respondent: Shri Dr. P. Daniel, Spl. Counsel
Section 144Section 234A

CBDT. 4. It is, however, clarified that the above shall not apply in respect of such transactions in shares/securities where the genuineness of the transaction itself is questionable, such as bogus claims of Long Term Capital Gain / Short Term Capital Loss or any other sham transactions. 5. It is reiterated

ITO, Ward-4(4), Gurgaon vs. Tribhawan Kumar Parnami, Gurgaon

ITA 2120/DEL/2018[2009-10]Status: DisposedITAT Delhi12 Mar 2025AY 2009-10

Bench: Shri Satbeer Singh Godara & Shri Manish Agarwal

Section 1Section 143(3)Section 153A

that the additional evidences may not be admitted as the assessee was given enough opportunity to substantiate identity, creditworthiness of the parties and genuineness of the transaction. While giving relief to the assessee, the Ld. CIT(A) has not discussed in the appellate order how the identity, creditworthiness ... parties and genuineness of the transactions were established. 5. Whether on the facts and circumstances of the case and in the laws, the Ld. CIT(A) has erred in giving relief to the assessee on the issue relying on the decision of the Hon'ble Delhi High Court

Income Tax Officer, Jaipur vs. Kedia Builders and Colonizers Private Limited, Jaipur

In the result, all appeals of the revenue are stands dismissed

ITA 901/JPR/2024[2014-15]Status: DisposedITAT Jaipur11 Mar 2025AY 2014-15

Bench: DR. S. SEETHALAKSHMI (Judicial Member)

For Appellant: Sh. Sidharth RankaFor Respondent: Mrs. Anita Rinesh, JCIT-DR
Section 143(3)Section 147

Hire Purchase Pvt. Ltd. 25,00,110/- The assessee was required to prove the identity and credit worthiness of the above parties and genuineness of the transaction. The assessee was given ample opportunities and time to provide the required information. 7. The assessee was required to prove identity and creditworthiness ... above parties and genuineness of the transaction. The assessee was given ample opportunities and time to provide required information. The ld. AO after detailed discussion based on the investigation wings findings or information noted that none of the above companies has capacity or source Kedia Builders and Colonizers

Income Tax Officer, Jaipur vs. Kedia Builders and Colonizers Private Limited, Jaipur

In the result, all appeals of the revenue are stands dismissed

ITA 875/JPR/2024[2016-17]Status: DisposedITAT Jaipur11 Mar 2025AY 2016-17
For Appellant: Sh. Sidharth RankaFor Respondent: Mrs. Anita Rinesh, JCIT-DR
Section 143(3)Section 147

assessee was required to prove the identity and credit worthiness of the above parties and genuineness of the transaction. The assessee was given ample opportunities and time to provide the required information. 7. The assessee was required to prove identity and creditworthiness of above parties and genuineness of the transaction ... High Court in Commissioner Of Income Tax vs Nr Portfolio Pvt Ltd., stated that the assessee has not proved the Identity, creditworthiness or genuineness of the transaction. Merely showing that the transaction was through banking channels or by account payee instrument cannot tantamount to satisfactory discharge of onus

Income Tax Officer, Jaipur vs. Kedia Builders and Colonizers Private Limited, Jaipur

ITA 873/JPR/2024[2013-14]Status: DisposedITAT Jaipur11 Mar 2025AY 2013-14
For Appellant: Sh. Sidharth RankaFor Respondent: Mrs. Anita Rinesh, JCIT-DR
Section 143(3)Section 147

Hire Purchase Pvt. Ltd. 25,00,110/- The assessee was required to prove the identity and credit worthiness of the above parties and genuineness of the transaction. The assessee was given ample opportunities and time to provide the required information. 7. The assessee was required to prove identity and creditworthiness ... above parties and genuineness of the transaction. The assessee was given ample opportunities and time to provide required information. The ld. AO after detailed discussion based on the investigation wings findings or information noted that none of the above companies has capacity or source to invest such a huge amount

Income Tax Officer, Jaipur vs. Kedia Builders and Colonizers Private Limited, Jaipur

In the result, all appeals of the revenue are stands dismissed

ITA 872/JPR/2024[2012-13]Status: DisposedITAT Jaipur11 Mar 2025AY 2012-13
For Appellant: Sh. Sidharth RankaFor Respondent: Mrs. Anita Rinesh, JCIT-DR
Section 143(3)Section 147

Hire Purchase Pvt. Ltd. 25,00,110/- The assessee was required to prove the identity and credit worthiness of the above parties and genuineness of the transaction. The assessee was given ample opportunities and time to provide the required information. 7. The assessee was required to prove identity and creditworthiness ... above parties and genuineness of the transaction. The assessee was given ample opportunities and time to provide required information. The ld. AO after detailed discussion based on the investigation wings findings or information noted that none of the above companies has capacity or source 7 ITA No. 872 & others/JP/2024 Kedia

Jaipal Singh, Jaipur vs. Deputy Commissioner of Income Tax, Central Circle-2, Jaipur

Appeal of the assessee are disposed off

ITA 115/JPR/2024[2013-14]Status: DisposedITAT Jaipur11 Mar 2025AY 2013-14
For Appellant: Sh. S.R. Sharma, CA &For Respondent: Sh. Arvind Kumar, CIT-DR
Section 115BSection 153A

आयकर अपीलीय अधिकरण, जयपुर न्यायपीठ, जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”A” JAIPUR डा० एस. सीतालक्ष्मी, न्यायिक

M/S.Aaryavart Infrastructure Pvt. Ltd., Ahmedabad vs. The DCIT, Circle-1(1)(1) Presently Central Circle-1(3), Ahmedabad

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

ITA 219/AHD/2022[2012-13]Status: DisposedITAT Ahmedabad11 Mar 2025AY 2012-13

Bench: Ms. Suchitra Kamble & Shri Makarand V. Mahadeokarआयकर अपील सं /Ita No.219/Ahd/2022 िनधा"रण वष" /Assessment Year : 2012-13 Aaryavart Infrastructure Pvt. Ltd. Dy.Cit बनाम/ Ff – 17/A, Pariseema Complex Circle-1(1)(1) V/S. C.G. Road Presently Cen. Cir.1(3) Navrangpura Ahmedabad Ahmedabad – 380 009 "थायी लेखा सं./Pan: Aadca 4844 Q अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Shri Aseem Thakkar, Ar Revenue By : Shri Kavan Limbasiya, Sr. Dr सुनवाई की तारीख/Date Of Hearing : 07/03/2025 घोषणा की तारीख /Date Of Pronouncement: 11/03/2025 आदेश/O R D E R Per Makarand V. Mahadeokar, Am: This Appeal Has Been Preferred By The Assessee Against The Order Of The Commissioner Of Income Tax (Appeals)-11, Ahmedabad [Hereinafter Referred To As “Cit(A)”], Dated 30.03.2022, For The Assessment Year (Ay) 2012-13, Whereby The Cit(A) Has Confirmed The Additions Made By The Assessing Officer [Hereinafter Referred To As “Ao”] Under Section 68 Of The Income Tax Act, 1961 [Hereinafter Referred To As “The Act”]. Aaryavart Infrastructure Pvt.Ltd. Vs. Dcit Asst. Year : 2012-13

For Appellant: Shri Aseem Thakkar, ARFor Respondent: Shri Kavan Limbasiya, Sr. DR
Section 143(3)Section 2(24)(x)Section 40Section 68

held that – - The assessee failed to satisfactorily establish the identity and creditworthiness of the lenders and the genuineness of the transactions. - The explanation provided by the assessee was inconsistent, as the identity of one of the lenders, Neelam Ahuja, was later changed to Narayan P. Ahuja, creating doubts about ... STAFF)”. Additionally, the assessee has rectified the initial misreporting of the lender’s name and has submitted sufficient corroborative evidence to establish the genuineness of the transaction. 7.1. We also take cognizance of various judicial precedents, including those of the jurisdictional Gujarat High Court, which establish that when a loan

Kailaswasi Narayan Alias Bapu Patil Shikshan Prasarak Mandal, Kolhapur vs. Income-Tax Officer, Ward 1(2), Kolhapur

In the result, the appeal of assessee is treated as allowed for statistical purpose

ITA 620/PUN/2020[2011-12]Status: DisposedITAT Pune11 Mar 2025AY 2011-12

Bench: Shri R.K. Panda & Ms. Astha Chandra

For Appellant: CA Supriya PowarFor Respondent: Shri Ramnath P. Murkunde
Section 11Section 12ASection 143(2)Section 143(3)Section 3Section 68

therefore added the entire donation of Rs.24,82,619/- as revenue receipts taxable u/s.68 of the Act since the genuineness of the transactions remained unproved by the assessee. Further, the Ld. AO disallowed the entire expenditure claimed by the assessee relying upon the affidavits of the teaching and non- teaching ... Assessing Officer, therefore, held that the entire receipts shown of Rs.24,82,619/-was duly confirmed by the donors/contributors and therefore the genuineness of the transactions remained unproved. He, therefore, added the entire donation as revenue receipts and taxed the same u/s.68 of the Act. v) The Assessing Officer, however

Dy Commissioner of Income Tax -5(2)(1), Mumbai vs. Meridian Chem Bond Private Liimited, Mumbai

In the result, both the appeals of the Revenue and both the Cross

ITA 1813/MUM/2024[2008-09]Status: DisposedITAT Mumbai11 Mar 2025AY 2008-09

Bench: Justice (Retd.) Shri C.V. Bhadang & Shri B.R. Baskaran

For Appellant: Shri Suchek Anchaliya &For Respondent: Shri Leyaqat Ali Aafaqui
Section 143(1)Section 148Section 68

submitted that the assessee has discharged its onus by proving three main ingredients, namely, identity of creditors, creditworthiness and genuineness of the transactions. He submitted that the Ld.CIT(A) has deleted the addition on verifying the details furnished by the assessee. He 5 Meridian Chem Bond Private Limited also submitted ... above, the appellant has furnished all the details proving conclusively the three ingredients of identity and creditworthiness of the creditors and the genuineness of the transaction. The amounts were paid by the creditors from their running bank accounts which were accounted in the books of the appellant as well

Dy. Commissioner of Income Tax -5(2)(1), Mumbai vs. Meridian Chem Bond Private Liimited, Mumbai

In the result, both the appeals of the Revenue and both the Cross

ITA 1769/MUM/2024[2009-10]Status: DisposedITAT Mumbai11 Mar 2025AY 2009-10

Bench: Justice (Retd.) Shri C.V. Bhadang & Shri B.R. Baskaran

For Appellant: Shri Suchek Anchaliya &For Respondent: Shri Leyaqat Ali Aafaqui
Section 143(1)Section 148Section 68

submitted that the assessee has discharged its onus by proving three main ingredients, namely, identity of creditors, creditworthiness and genuineness of the transactions. He submitted that the Ld.CIT(A) has deleted the addition on verifying the details furnished by the assessee. He 5 Meridian Chem Bond Private Limited also submitted ... above, the appellant has furnished all the details proving conclusively the three ingredients of identity and creditworthiness of the creditors and the genuineness of the transaction. The amounts were paid by the creditors from their running bank accounts which were accounted in the books of the appellant as well

Rolta India Ltd, Mumbai vs. Dy. Commissioner of Income Tax Central Circle-1(1), Mumbai

Appeal of the assessee is partly allowed

ITA 2144/MUM/2023[2015-16]Status: DisposedITAT Mumbai11 Mar 2025AY 2015-16

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

For Appellant: Shri Shekhar Gupta, AR
Section 115JSection 133(6)Section 35

could not reconcile the difference in the purchase amount. We further notice that the AO while making the addition did not question the genuineness of the transaction or did not hold that the purchases are bogus. We also notice that the addition is made for the reason that the purchase

Kailash Chand, Jaipur vs. ITO Ward, Behror

In the result, the appeal of the assessee is allowed

ITA 565/JPR/2024[2012-13]Status: DisposedITAT Jaipur10 Mar 2025AY 2012-13

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Judicial Member)

For Appellant: Sh. Mahendra Gargieya, Adv. &For Respondent: Sh. Dinesh Badgujar, Addl. CIT
Section 142(1)Section 144Section 144BSection 147Section 148Section 234A

duty of the appellant to provide the information called for. The onus always lies on the assessee to prove the genuineness of the transaction. During the appellate proceedings also, the appellant had not filed the bills and vouchers in support of his claim of additions to fixed assets

The Asst.CIT., Central Circle-1(2), Ahmedabad vs. Shri Maheshbhai Shantilal Patel, Ahmedabad

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

ITA 13/AHD/2020[1993-94]Status: DisposedITAT Ahmedabad10 Mar 2025AY 1993-94

Bench: Dr. B.R.R. Kumar, Vice-Shri Siddhartha Nautiyal

For Appellant: written submission filedFor Respondent: Shri Yogesh Mishra, Sr DR
Section 132Section 250

facts in not appreciating the fact that the assessee was failed to prove identity and creditworthiness of the lender and genuineness of the transaction. 3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) ought to have upheld the order

Dy. Commissioner of Income Tax, Central Circle-5(1), Mumbai vs. Cec-Itd Cem-Tpl Joint Venture, Mumbai

In the result, all the appeals filed by the assessee are allowed and Revenue’s appeals are dismissed

ITA 5227/MUM/2024[2017-18]Status: DisposedITAT Mumbai10 Mar 2025AY 2017-18

Bench: SHRI AMIT SHUKLA (Judicial Member), SHRI GIRISH AGRAWAL (Accountant Member)

Section 133ASection 147Section 148Section 148A

that few of the parties have in fact replied to the Assessing Officer and has given complete particulars and documents in support of genuineness of the transactions. The CEC-LTD CEM TPL JOINT VENTURE copies of such replies were also furnished with the ld. CIT (A). As regards balance parties ... vice-versa. Further, the parties to which Fee for Technical Services has been made have failed to provide the details to substantiate the genuineness of the transaction with assessee in response to notice u/s 133(6) of the Act. 6.9 It is also important to mention here that

Dy. Commissioner of Income Tax, Central Circle-5(1), Mumbai vs. Cec-Itd Cem-Tpl Joint Venture, Mumbai

In the result, all the appeals filed by the assessee are

ITA 5226/MUM/2024[2018-19]Status: DisposedITAT Mumbai10 Mar 2025AY 2018-19
Section 133ASection 147Section 148A

that few of the parties have in fact replied to the Assessing Officer and has given complete particulars and documents in support of genuineness of the transactions. The copies of such replies were also furnished with the ld. CIT (A). As regards balance parties, it was submitted that all relevant

Dy. Commissioner of Income Tax, Central Circle-5(1), Mumbai vs. Cec-Itd Cem-Tpl Joint Venture, Mumbai

ITA 5225/MUM/2024[2019-20]Status: DisposedITAT Mumbai10 Mar 2025AY 2019-20
Section 133ASection 147Section 148ASection 37(1)

IN THE INCOME TAX APPELLATE TRIBUNAL, ‘C' BENCH MUMBAI BEFORE: SHRI AMIT SHUKLA, JUDICIAL MEMBER & SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER

Dy. Commissioner of Income Tax, Central Circle-5(1), Mumbai vs. Cec-Itd Cem-Tpl Joint Venture, Mumbai

In the result, all the appeals filed by the assessee are allowed and Revenue’s appeals are dismissed

ITA 5224/MUM/2024[2021-22]Status: DisposedITAT Mumbai10 Mar 2025AY 2021-22

Bench: SHRI AMIT SHUKLA (Judicial Member), SHRI GIRISH AGRAWAL (Accountant Member)

Section 133ASection 147Section 148Section 148A

that few of the parties have in fact replied to the Assessing Officer and has given complete particulars and documents in support of genuineness of the transactions. The CEC-LTD CEM TPL JOINT VENTURE copies of such replies were also furnished with the ld. CIT (A). As regards balance parties ... vice-versa. Further, the parties to which Fee for Technical Services has been made have failed to provide the details to substantiate the genuineness of the transaction with assessee in response to notice u/s 133(6) of the Act. 6.9 It is also important to mention here that

Dy. Commissioner of Income Tax, Central Circle-5(1), Mumbai vs. Cec-Itd Cem-Tpl Joint Venture, Mumbai

In the result, all the appeals filed by the assessee are

ITA 5223/MUM/2024[2022-23]Status: DisposedITAT Mumbai10 Mar 2025AY 2022-23
Section 133ASection 147Section 148A

that few of the parties have in fact replied to the Assessing Officer and has given complete particulars and documents in support of genuineness of the transactions. The copies of such replies were also furnished with the ld. CIT (A). As regards balance parties, it was submitted that all relevant

ITO, Mumbai vs. Bhumika Rajesh Vatnani, Mumbai

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

ITA 5177/MUM/2024[2013-14]Status: DisposedITAT Mumbai10 Mar 2025AY 2013-14

Bench: Shri B.R. Baskaran & Shri Sandeep Gosainassessment Year : 2013-14 Income Tax Officer-24(1)(1), Bhumika Rajesh Vatnani, Piramal Chambers, 2601/02, Royal Empire, Lalbaugh, Parel, Vs. Shashtri Nagar, Mumbai Andheri West, Mumbai Pan :Admpv7590F (Appellant) (Respondent)

For Appellant: Shri Bhupendra ShahFor Respondent: Shri Leyaqat Ali Aafaqui
Section 10(38)

this, all that the Commissioner observed is that the Assessee transacted through brokers at Calcutta, which itself raises doubt about the genuineness of the transactions and the financial result and performance of the Company was not such as would justify the increase in the share prices. Therefore, he reached