Section 268A of the Income Tax Act

Income-tax Act, 2025: s.373

Section 268A of the Income-tax Act, 1961 corresponds to section 373 (Filing of appeal by income-tax authority) of the Income-tax Act, 2025.

Read section 373 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 268A is Seth R. Dalmia v. CIT (110 ITR 644), cited in 40 of the 3,931 judgments on BharatTax that turn on this section.

Leading authorities on Section 268A

Seth R. Dalmia v. CIT
110 ITR 644 · 1977 · Supreme Court
40
citing judgments

An indirect connection between expenditure and income can be sufficient to establish the required nexus for deductibility under Section 57(iii). The connection need not be direct.

Krishnanand Agnihotri v. The State of Madhya Pradesh
1 SCC 816 · 1977 · Supreme Court
38
citing judgments

The burden of proving a transaction to be benami, or that the apparent owner is not the real owner, rests strictly on the party asserting it, requiring definite evidence or circumstances that reasonably infer the fact, not mere suspicion.

CIT v. H.H. Maharani Vijaykuverba Saheb of Morvi
100 ITR 67 · 1975 · High Court
27
citing judgments

The connection between an expenditure and the earning of income need not be direct; an indirect connection can establish the nexus between the expenditure incurred and the income earned for the purpose of Section 57(iii).

CIT v. Smt. Sushila Devi Khadaria
319 ITR 413 · 2009 · High Court
27
citing judgments

Expenditure is deductible under Section 57(iii) if it has a proximate and relevant connection to the earning of income, even if the income arises as a by-product of other activities.

Ajay Sharma v. Dy. CIT
30 Taxmann.com 109 · 2013 · Reported
25
citing judgments

Where no undisclosed income or incriminating material is found during a search, penalty under section 271AAB cannot be imposed. Additions based on alleged receivables from seized papers require direct material to establish undeclared income.

CIT v. Jagmohandas J. Kapadia
61 ITR 663 · 1966 · High Court
25
citing judgments

Expenditure is deductible under section 57(iii) of the Income Tax Act only if it is incurred solely for the purpose of making or earning dividend income.

DCIT v. Manish Agarwal
92 Taxmann.com 81 · 2018 · Reported
19
citing judgments

Section 271AAB of the Income-tax Act, 1961, does not mandate the imposition of penalty in every case of default; the Assessing Officer retains discretion to levy or not levy a penalty, which must be exercised judiciously considering all relevant circumstances.

CIT v. Madhukar K Inamdar HUF
318 ITR 149 · 2009 · High Court
7
citing judgments
ITO v. Palak Chinubhai Patel
137 Taxmann.com 194 · 2022 · ITAT
4
citing judgments
81 Taxmann.com 245 (Pune Trib) 2. M/s Nippon Paint India Pvt. Ltd. v. ACIT
16 Taxmann.com 352 · 2011 · High Court
3
citing judgments

Judgments on Section 268A

Ast CIT 10(3)(1), Mumbai vs. Hsbc Invest Direct (India) Ltd, Mumbai

In the result, appeal of revenue is dismissed

ITA 7324/MUM/2014[2011-12]Status: DisposedITAT Mumbai03 Oct 2016AY 2011-12

Bench: Shri R.C.Sharma, Am & Shri Pawan Singh, Jm आमकय अऩीर सं./Ita No.7324/Mum/2014 (नििाारण वषा / Assessment Year :2011-12) Acit-10(3)(1), Mumbai Vs. Hsbc Invest Direct(India) Ltd., 5Th Floor, Umang Building, Plot Cts No.1406-A/28, Mind Space, Behind Inorbit Mall, New Link Road, Malad(W), Mumbai – 400064 स्थामी रेखा सं./ जीआइआय सं./ Pan/Gir No. : Aaaci3364A (अऩीराथी /Appellant) (प्रत्मथी / Respondent) .. याजस्व की ओर से /Revenue By : Shri Jeevanlal Lavedia ननधाारयती की ओर से /Assessee By : Shri D.V. Lakhani सुनवाई की तायीख / Date Of Hearing : 03/10/2016 घोषणा की तायीख/Date Of Pronouncement 03/10/2016 आदेश / O R D E R Per R.C.Sharma (A.M): This Is An Appeal Filed By The Revenue Against The Order Of Cit(A)- Mumbai, Dated 09-04-2014, For The Assessment Year 2011-12, In The Matter Of Order Passed U/S.143(3) Of The I.T.Act. 2. At The Outset, Ld. Counsel For The Assessee Stated That In Order To Cut Down On Frivolous Litigation & Taxpayer’S Grievance, The Cbdt, Which Formulates Policies For The Income Tax Department, Has Issued Recent Instruction No.21/2015 Dated 10.12.2015 Revising The Monetary Threshold Fixing The Tax Effect Limit Of Rs.10 Lacs For The Revenue To File Appeal Before The Itat

For Appellant: Shri D.V. LakhaniFor Respondent: Shri Jeevanlal Lavedia
Section 143(3)Section 260ASection 268A

Hinduja Ventures Ltd, Mumbai vs. DCIT Cir 8(2), Mumbai

In the result, the assessee’s appeal is allowed for statistical purposes, while the Revenue’s appeal is dismissed as not maintainable

ITA 302/MUM/2014[2010-11]Status: DisposedITAT Mumbai30 Sept 2016AY 2010-11

Bench: Shri Sanjay Arora, Am & Shri Pawan Singh, Jm आयकर अपील सं./I.T.A. No. 302/Mum/2014 ("नधा"रण वष" / Assessment Year: 2010-11) Hinduja Ventures Ltd. Dy. Cit, Circle 8(2), बनाम/ 49/50, In Centre, Midc, Aayakar Bhavan, 12Th Road, Marol, Andheri (E), Mumbai-400 020 Vs. Mumbai-400 093 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaach 2058 N (Assessee) (Revenue) : & आयकर अपील सं./I.T.A. No. 690/Mum/2014 ("नधा"रण वष" / Assessment Year: 2010-11) Dy. Cit, Circle 8(2), Hinduja Ventures Ltd. बनाम/ Aayakar Bhavan, 49/50, In Centre, Midc, 12Th Road, Marol, Andheri (E), Mumbai-400 020 Vs. Mumbai-400 093 (Revenue) (Assessee) : Assessee By : Shri Hari S. Raheja : Mrs. Neelma Nadkarni Revenue By सुनवाई क" तार"ख / : 08.09.2016 Date Of Hearing घोषणा क" तार"ख / : 30.09.2016 Date Of Pronouncement आदेश / O R D E R Per Sanjay Arora, A. M.: These Are Cross Appeals, I.E., By The Assessee & The Revenue, Directed Against The Order By The Commissioner Of Income Tax (Appeals)-17, Mumbai (‘Cit(A)’ For Short) Dated 29.11.2013, Partly Allowing The Assessee’S Appeal Contesting It’S

For Appellant: Shri Hari S. Raheja
Section 143(3)Section 14A