“source of source”

Cash Credits & Unexplained ItemsSection 68Section 68810 judgments

The decision most relied on for source of source is Jute Corporation of India Ltd. v. CIT (187 ITR 688), cited in 1,372 judgments on BharatTax.

Leading authorities on source of source

Jute Corporation of India Ltd. v. CIT

187 ITR 688 · 1991 · Supreme Court

1,372

citing judgments

The Commissioner of Income Tax (Appeals) possesses co-terminus powers with the Assessing Officer and can direct the Assessing Officer to perform actions he failed to do, but cannot introduce a new source of income in the assessment. The appellate assessment must be confined to the items of income that were the subject matter of the original assessment.

Totgars Co-operative Sale Society Ltd. v. ITO

322 ITR 283 · 2010 · Supreme Court

1,283

citing judgments

The interest income earned by a cooperative society from investing its surplus funds in fixed deposits with banks is not "derived from" its eligible business activities and is taxable as "income from other sources" under Section 56, thus not qualifying for deduction under Section 80P.

K.P. Varghese v. ITO

131 ITR 597 · 1981 · Supreme Court

989

citing judgments

An addition to income cannot be made merely on the basis of a difference in valuation of assets or a Valuation Officer's report without establishing actual understatement of consideration or the source of unexplained funds through proper enquiry. The Assessing Officer must conduct proper enquiry and satisfy the conditions for making such additions.

GE India Technology Centre Pvt. Ltd. v. CIT

327 ITR 456 · 2010 · Supreme Court

663

citing judgments

Tax must be deducted at source from payments made to a non-resident under Section 195 only if such payment is chargeable to tax in India. The Assessing Officer bears the onus to establish that the payments made are indeed chargeable to tax under the Income Tax Act.

Commissioner of Income Tax v. Nova Promoters and Finlease (P) Ltd.

342 ITR 169 · 2012 · High Court

658

citing judgments

To make an addition under Section 68 for unexplained cash credits, the Assessing Officer must conduct proper inquiry into the identity, genuineness, and creditworthiness of the creditor, especially concerning share application money. The assessee's initial discharge of burden by providing necessary details shifts the onus back to the AO for further investigation, including the source of source.

Tuticorin Alkali Chemicals & Fertilizers Ltd. v. CIT

227 ITR 172 · 1997 · Supreme Court

621

citing judgments

Interest income earned on deposits, particularly before the commencement of business operations or as a requirement for business licensing, is taxable as "income from other sources" under Section 56, and cannot be treated as business income or set off against interest on borrowed funds.

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.

Liberty India v. CIT

317 ITR 218 · 2009 · Supreme Court

571

citing judgments

The Supreme Court clarified that for profits and gains to be eligible for deductions under sections like 10B, 80IA, or 80IB, the income must be "derived from" or have a direct nexus to the eligible business activity. Income from incidental sources like the sale of scrips/licenses or interest on employee loans is generally not considered as derived from the eligible business for such deductions.

Judgments citing source of source

Om Prakash Gupta, Sawai Madhopur vs. DCIT Central Circle -1, Jaipur

The appeals of the assessee are disposed off as under :

ITA 399/JPR/2025[2017-18]Status: DisposedITAT Jaipur18 Sept 2025AY 2017-18

For Appellant: Shri Tarun Mittal, CA &For Respondent: Shri Rajesh Ojha, CIT-DR &

Section 115BSection 153ASection 69

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

Deputy Commissioner of Income Tax, Circle 2(1)(1), Vadodara vs. Truform Techno Products Private Limited, Nagpur

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

ITA 1776/AHD/2024[2012-13]Status: DisposedITAT Ahmedabad18 Sept 2025AY 2012-13

Bench: Shri Sanjay Garg & Shri Narendra Prasad Sinhaassessment Year: 2009-10

Section 143(2)Section 143(3)Section 147Section 148Section 151Section 68Section 78(2)

Assessing Officer did not make any enquiry with the shareholders and had placed the onus on the assessee to establish the source of source, which was not the law in the A.Y. 2009-10, to which the present appeal pertains. In this regard, she relied on the judgement ... submitted that the Department was free to proceed with the individual assessment of the shareholders, if the source of source was not explained. The Ld. AR submitted that the assessee had discharged the initial burden to establish the identity of the shareholders and also established their creditworthiness. Therefore

Deputy Commissioner of Income Tax, Circle 2(1)(1), Vadodara vs. Truform Techno Products Private Limited, Nagpur

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

ITA 1775/AHD/2024[2009-10]Status: DisposedITAT Ahmedabad18 Sept 2025AY 2009-10

Bench: Shri Sanjay Garg & Shri Narendra Prasad Sinhaassessment Year: 2009-10

Section 143(2)Section 143(3)Section 147Section 148Section 151Section 68Section 78(2)

J.K.V. Stonex, Kishangarh vs. Income Tax Officer, Kishangarh

In the result, the appeal of the assessee is allowed

ITA 542/JPR/2025[2012-13]Status: DisposedITAT Jaipur17 Sept 2025AY 2012-13

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

For Appellant: ShriSandeep Jhanwar, CAFor Respondent: Shri Gaurav Awasthi, JCIT-DR

Section 147Section 68

bank accounts. Narayan Agarwal and Shri Krishna Murari Agarwal It is not responsibility of assessee have deposited cash of firm to provide source of source of Rs.3,60,500/- and cash deposited in partners’ bank accounts specifically when no Rs.32,46,800/- respectively in their bank income

ACIT, Central Circle-13, New Delhi vs. Double Plus Software P.Ltd, Nedw Delhi

ITA 4745/DEL/2018[2010-11]Status: DisposedITAT Delhi16 Sept 2025AY 2010-11

Bench: Shri Mahavir Singh, Hon'Ble(As) & Ms. Madhumita Roy & Shri Brajesh Kumar Singh

Section 143(1)Section 143(2)Section 143(3)Section 68

assessee in the form of a paper book. Learned Tribunal records the finding of fact that the assessee has established source of source, even though it was not required for the assessment year under consideration. The documents which were called for by the Assessing Officer were admittedly produced ... assessee in the form of a paper book. Learned Tribunal records the finding of the fact that the assessee has established source of source, even though it was not required for the Assessment Year under consideration. The documents which were called for by the Assessing Officer were admittedly

Suman Forwarding Agency Private Ltd., Howrah vs. DCIT, Circle 13(1), Kolkata

In the result, the appeal of the assessee is allowed

ITA 1432/KOL/2025[2017-2018]Status: DisposedITAT Kolkata15 Sept 2025AY 2017-2018

Bench: Shri Rajesh Kumar, Am & Shripradip Kumar Choubey, Jm

Section 133(6)Section 142(1)Section 143(1)Section 143(2)Section 143(3)Section 68Section 69C

assessee has explained the source of the said money invested in the assessee company by the subscriber company and therefore, the source of source is also proved. Therefore, finding given by the Id. CIT (A) upholding the assessment order that the identity and creditworthiness of the investors ... investor which was duly replied and copy of reply was available at page no.82 of the PB, wherein the source of source is also explained. Therefore, we do not find any reason to sustain the order of the Id. Commissioner of Income-tax (Appeals). Accordingly, we set aside

Booking.Com India Support & Marketing Services Private Limited, Mumbai vs. Deputy Commissioner of Income Tax, Circle 6(1)(2), Mumbai

In the result, appeal of the assessee is partly allowed

ITA 3675/MUM/2025[2020-21]Status: DisposedITAT Mumbai15 Sept 2025AY 2020-21

Bench: Shri Narendra Kumar Billaiya, Hon’Ble & Shri Sandeep Singh Karhail, Hon’Ble

For Appellant: Shri Ajit Jain, Shri Siddhesh ChauguleFor Respondent: Shri Satyaprakash R. Singh, CIT D/R

Section 142(1)Section 143(3)Section 263Section 80G

that our above observations should not be inferred to mean that it is open to the Assessing Officer to enquire into the source of source for the purpose of the present facts. This is a case where a view has been taken by the Assessing Officer on enquiry

Fusion Granito Private Limited, Morbi vs. The Pr. Commissioner of Income Tax - 1, Rajkot

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

ITA 190/RJT/2023[2018-19]Status: DisposedITAT Rajkot10 Sept 2025AY 2018-19

Bench: Dr. A. L. Saini, Am & Shri Dinesh Mohan Sinha, Jm आयकर अपील सं./Ita No.190/Rjt/2023 (िनधा"रण वष" / Assessment Year: (2018-19) (Physical Hearing) Fusion Granito Pvt. Ltd. बनाम/ Principal Commissioner Of Income Revenue Survey No.555/P1/91, Tax-1, Vs. Nr. Khokhra Hanuman Temple, 2Nd Jetpar Road, Morbi-363641 Rajkot, Floor, “Aayakar Bhawan”, Race Course Ring Road, Rajkot-360001 "ायीलेखासं./जीआइआरसं./Pan/Gir No.: Aadcf 0696 B (अपीलाथ"/Appellant) (""थ" /Respondent) अपीलाथ" ओर से/ Appellant By Shri Bandish Soparkar, Ar ""थ" की ओर से/Respondent By Shri Praveen Verma, Cit Dr सुनवाई की तारीख/Date Of Hearing 24/06/2025 घोषणा की तारीख /Date Of Pronouncement 10/09/2025 आदेश / O R D E R Per Dr. Arjun Lal Saini, A.M By Way Of This Appeal, The Assessee Has Challenged The Correctness Of The Order Passed By The Learned Principal Commissioner Of Income Tax - 1, Rajkot [In Short ‘Ld. Pcit’], Dated 27.03.2023, Under Section 263 Of The Income Tax Act, 1961 [Hereinafter Referred To As The ‘Act’] For The Assessment Year (Ay) 2018-19. 2. Grievances Raised By The Assessee, Which, Being Interconnected, Will Be Taken Up Together, Are As Follows: “1. The Revision Order U/S 263 Of The Act Dated 28.03.2023 Is Bad In Law. 2. The Hon’Ble Pr. Cit-1, Rajkot Has Erred In Law As Well As On Facts In Completing The Revision Proceedings U/S 263 Of The Act Hurriedly In Short Span Of Time Fusion Granito Pvt. Ltd.

Section 143(3)Section 263Section 68

other hand, Learned Departmental Representative (Ld. DR) for the Revenue submitted that first of all the assessee has failed to prove source of source, in respect of share capital, as the assessment in the year under consideration is the assessment year 2018-19, wherein source of source ... make inquiry to examine the source of the source, nor the assessee has submitted any documents about the source of source. The Ld.CIT-DR also submitted that Ld.PCIT has quoted a plethora judgment of Hon’ble Supreme Court and various Hon’ble High Courts and passed

Income Tax Office, Chennai vs. Roopa Maganti, Chennai

In the result, the appeal of the Revenue is dismissed

ITA 1436/CHNY/2025[2018-19]Status: DisposedITAT Chennai04 Sept 2025AY 2018-19

Bench: Hon’Ble Shri Manu Kumar Giri & Hon’Ble Shri Amitabh Shuklaआयकर अपील सं./Ita No.1436/Chny/2025 Assessment Years: 2018-19 Income Tax Officer, Roopa Maganti, Non-Corporate Circle-19(6), No.184-187, Temple Steps, Ground Floor 4Th Block, Little Mount, Chennai. Anna Salai, Chennai-600 015. [Pan: Aeopr5992L]

For Appellant: Mr.B.Ramakrishnan, F.C.AFor Respondent: Mr.P.Krishna Kumar, JCIT

Section 133(6)Section 68

well as judicial precedents. We have also noted that the conclusions drawn by the Ld.AO also revolve around the premise of examining source of source which is not permissible by law. Accordingly, we are of the considered view that the order of the Ld.CIT(A) is based upon

Income Tax Officer Ward-3(3)(2), Ahmedabad vs. Manthan Shyam Ganatra, Ahmedabad

In the result, appeal filed by the Revenue is dismissed

ITA 2032/AHD/2024[2018-19]Status: DisposedITAT Ahmedabad03 Sept 2025AY 2018-19

Bench: SMT. ANNAPURNA GUPTA (Accountant Member), SHRI T.R. SENTHIL KUMAR (Judicial Member)

For Appellant: Shri Yogesh Mishra, Sr.DRFor Respondent: Shri Sunil Maloo, AR

Section 139(1)Section 139(4)Section 148Section 148ASection 250Section 68

only provided PAN of the person but had also demonstrated that all these transactions were through banking channels and had also proven source of source of the fund which credited to the account of the assessee. With father and mother, the assessee has running account

ACIT, New Delhi vs. M/S Worldlink Telecom Ltd., New Delhi

In the result, the appeal of the revenue for assessment year 2004-05 is dismissed and appeal for assessment year 2006-07 is partly allowed

ITA 2596/DEL/2017[2006-07]Status: DisposedITAT Delhi29 Aug 2025AY 2006-07

Bench: Shri M. Balaganesh & Shri Vimal Kumar

For Appellant: Shri Amol Sinha, AdvFor Respondent: Ms. Harpreet Kaur Hansra, Sr. DR

Section 147Section 68

monies were lying in the bank account of the loan creditors and there is no requirement for the assessee to prove the source of source of the loan creditors for the year under consideration. Non-production of the Director by the assessee company cannot be a reason

ACIT, New Delhi vs. M/S Worldlink Telecom Ltd., New Delhi

In the result, the appeal of the revenue for assessment year 2004-05 is dismissed and appeal for assessment year 2006-07 is partly allowed

ITA 2595/DEL/2017[2004-05]Status: DisposedITAT Delhi29 Aug 2025AY 2004-05

Bench: Shri M. Balaganesh & Shri Vimal Kumar

For Appellant: Shri Amol Sinha, AdvFor Respondent: Ms. Harpreet Kaur Hansra, Sr. DR

Section 147Section 68

Deputy Commiossioner of Incometax, Jamnagar vs. Vasantbhai Muljibhai Kanani, Jamnagar

In the result, appeal filed by the revenue is dismissed, whereas appeal filed by the assessee is allowed

ITA 124/RJT/2025[2022-23]Status: DisposedITAT Rajkot28 Aug 2025AY 2022-23

Bench: Dr. Arjun Lal Saini & Shri Dinesh Mohan Sinhaआयकर अपील सं /.Ita No.124/Rjt/2025 िनधा"रणवष"/ Assessment Year: 2022-23 Dy. Cit, Cir-1 Vasantbhai Muljibhai Kanani बनाम Jamnagar. Plot No.7, Ambica Enterprise Vs. Sardar Patel Ind. Estte-4 Indira Road Opp: Jakat Naka, Jamnagar-361004 (Guj) Pan : Aitpk 8038 P आयकर अपील सं /.Ita No.08/Rjt/2025 िनधा"रणवष"/ Assessment Year: 2022-23 Vasantbhai Muljibhai Kanani Dy. Cit, Cir-1 बनाम Plot No.7, Ambica Enterprise Jamnagar. Sardar Patel Ind. Estte-4 Vs. Indira Road Opp: Jakat Naka, Jamnagar- 361004 (Guj) Pan : Aitpk 8038 P (अपीलाथ"/Assessee) : (""यथ"/Respondent)

For Appellant: Shri Sagar Shah, ld.AR

Section 143(3)Section 144BSection 250Section 68Section 69C

deleted the addition made by the assessing officer. The learned CIT(A) observed that the assessee has even explained the source of source of unsecured loan taken with support of bank statement. Thus, the assessee has discharged onus cast upon him of proving the genuineness of unsecured loan ... No.124 /RJT/2025 and 08/RJT/2025 18 25. From the above factual position, the ld.CIT(A) noticed that the assessee has even explained the source of source of unsecured loan taken with support of bank statement. Thus, it is clear from the above facts that the assessee has discharged onus

Income Tax Officer Ward 52(1) New Delhi, New Delhi vs. M/S Novel Infratech, New Delhi

In the result appeal of the revenue is dismissed

ITA 188/DEL/2025[2013-14]Status: DisposedITAT Delhi27 Aug 2025AY 2013-14

Bench: Shri M. Balaganesh & Shri Sudhir Kumarito, Vs. M/S. Novel Infratech, Ward-52(1), Flat No. 915, Indra Prakash New Delhi Building, 21, Barakhamba Road, New Delhi (Appellant) (Respondent) Pan: Aajfn0187A

For Appellant: Shri Ved Jain, AdvFor Respondent: Shri Ajay Kumar Arora, Sr. DR

Section 131(1)(d)Section 133(6)Section 143(3)Section 68

received. (iii) Copies of medical records of Parmod Khanna showing that he was suffering from throat cancer (iv) Documents in support of source of source of funds in the accounts of the lenders 3. LOAN FROM M/S PARNIKA MERCANTILE PVT LTD. (i) Copy of Loan Account ... Nitin Hire Purchase Pvt. Ltd. 7. Loan from Sh Chander Kishore Dhingra / Sunil Gupta Assessee firm filed evidence in support of "Source of source of funds" in the bank accounts of the lenders. 8. These additional evidences were duly admitted and remand report was sought from

Assistant Commissioner of Income Tax, Circle-1(1)(1), Meerut vs. Paswara Papers Ltd, Meerut

In the result, Appeal of the Revenue is dismissed

ITA 5026/DEL/2024[2016-17]Status: DisposedITAT Delhi27 Aug 2025AY 2016-17

Bench: Shri Yogesh Kumar U.S. & Shri Manish Agarwal

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

relevant period, share application form alongwith share certificates etc. However, the AO has not made any further inquiry to verify the source of source and simply added the entire amount of share application money of Rs.1,01,65,500/- u/s. 68 which is not sustainable being based

DCIT Central Circle 30, New Delhi vs. Krrish Shalimar Projects Pvt. Ltd., Delhi

In the result, appeal filed by the revenue is dismissed and appeal filed by the assessee is allowed for statistical purpose

ITA 3097/DEL/2023[2018-19]Status: DisposedITAT Delhi27 Aug 2025AY 2018-19

Bench: Shris.Rifaur Rahman & Shri Vimal Kumar

For Appellant: Shri K. Sampath, AdvocateFor Respondent: Shri Amit Kumar Jain, CIT DR

Section 133(6)Section 143(2)Section 68

assessee had submitted all the relevant documents in support of the transactions like Pan, financial statements, confirmation, bank statements proving the source of source. The AO rejected all the documents on the basis that the lenders have not responded to the notice issued u/s 133(6). Further

DCIT, New Delhi vs. Krish Shalimar Project Pvt Ltd, Delhi

ITA 2500/DEL/2023[2017-18]Status: DisposedITAT Delhi27 Aug 2025AY 2017-18

Bench: Shris.Rifaur Rahman & Shri Vimal Kumar

For Appellant: Shri K. Sampath, AdvocateFor Respondent: Shri Amit Kumar Jain, CIT DR

Section 133(6)Section 143(2)Section 68

liable to be deleted. ii. In this regard a detailed discussion with regard to the source of the source (i.e. source of M/s Cloister Realtors Pvt. Ltd. to extend loan to the appellant) is discussed as under: Source Documents Annexur Date of Receipt Received From Amount

Krrish Shalimar Projects Pvt. Ltd., Delhi vs. Assistant Commissioner of Income Tax, Central Circle 30, Delhi

In the result, appeal filed by the revenue is dismissed and appeal filed by the assessee is allowed for statistical purpose

ITA 2347/DEL/2023[2017-18]Status: DisposedITAT Delhi27 Aug 2025AY 2017-18

Bench: Shris.Rifaur Rahman & Shri Vimal Kumar

For Appellant: Shri K. Sampath, AdvocateFor Respondent: Shri Amit Kumar Jain, CIT DR

Section 133(6)Section 143(2)Section 68

Vishwas Concrete Pvt Ltd, Bangalore vs. ACIT, Central Circle-1, Bangalore

In the result, the appeals of the assessee for both the years are allowed

ITA 205/BANG/2025[2011-12]Status: DisposedITAT Bangalore26 Aug 2025AY 2011-12

Bench: Shri Prashant Maharishi & Shri Soundararajan K.

For Appellant: Shri Ravishankar, AdvocateFor Respondent: Shri Murali Mohan, CIT(DR)(ITAT), Bengaluru

Section 132Section 143(2)Section 153ASection 68

of funds is already available in the annual accounts of the investor company. Further assessee is not required to prove the source of source of the funds for the impugned assessment year as the necessary amendment to section 68 was inserted w.e.f. 1.4.2013. 9. Similarly ... accommodation entry. Further the only reason given is that the ITA No.204 & 205/Bang/2025 Page 9 of 9 assessee has not proved the source of source of the funds invested by the investor. We find that such provision has been by the Finance Act, 2012 w.e.f. 1.4.2013. Therefore prior

Vishwas Concrete Pvt Ltd, Bengaluru vs. ACIT, Central Circle-1, Bangalore

In the result, the appeals of the assessee for both the years are allowed

ITA 204/BANG/2025[2010-11]Status: DisposedITAT Bangalore26 Aug 2025AY 2010-11

Bench: Shri Prashant Maharishi & Shri Soundararajan K.

For Appellant: Shri Ravishankar, AdvocateFor Respondent: Shri Murali Mohan, CIT(DR)(ITAT), Bengaluru

Section 132Section 143(2)Section 153ASection 68