Section 68 of the Income Tax Act

Income-tax Act, 2025: s.102

Section 68 of the Income-tax Act, 1961 corresponds to section 102 (Unexplained credits) of the Income-tax Act, 2025.

Read section 102 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 68 is Pr. CIT v. Abhisar Buildwell (P.) Ltd. (149 Taxmann.com 399), cited in 2,379 of the 29,931 judgments on BharatTax that turn on this section.

Leading authorities on Section 68

Pr. CIT v. Abhisar Buildwell (P.) Ltd.
149 Taxmann.com 399 · 2023 · Supreme Court
2,379
citing judgments

An assessment under section 153A is without jurisdiction if there is an absence of incriminating material for an unabated assessment year.

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. Continental Warehousing Corporation (Nhava Sheva) Ltd.
374 ITR 645 · 2015 · High Court
1,823
citing judgments

In Section 153A proceedings, the scope of assessment extends to abated proceedings, enabling an assessee to raise fresh legal claims that could have been made in regular assessment proceedings.

CIT v. Kelvinator of India Ltd.
320 ITR 561 · 2010 · Supreme Court
1,673
citing judgments

An Assessing Officer cannot initiate reassessment proceedings under Section 147 of the Income Tax Act based on a mere change of opinion. Reassessment is permissible only when there is fresh tangible material leading to the belief of income escapement, not merely a review of existing facts.

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.

GKN Driveshafts (India) Ltd. v. ITO
259 ITR 19 · 2003 · Supreme Court
1,349
citing judgments

When a notice under Section 148 of the Income Tax Act is issued, the Assessing Officer is bound to furnish reasons for reopening upon the assessee's request and must dispose of the assessee's objections to the notice by passing a speaking order.

Dhakeshwari Cotton Mills Ltd. v. CIT
26 ITR 775 · 1954 · Supreme Court
1,061
citing judgments

Corroborative evidence is essential to support evidence found on third-party premises, and an assessment cannot be based on suspicion, surmises, or conjecture.

ACIT v. Rajesh Jhaveri Stock Brokers Pvt. Ltd.
291 ITR 500 · 2007 · Supreme Court
1,030
citing judgments

For initiating reassessment proceedings under Section 147, the Assessing Officer needs only prima facie material providing a reason to believe that income has escaped assessment. Conclusive proof or the sufficiency/correctness of the material is not required at the stage of issuing the notice under Section 148.

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.

Raymond Woollen Mills Ltd. v. ITO
236 ITR 34 · 1999 · Supreme Court
862
citing judgments

For reassessment proceedings under Section 148, the Assessing Officer only needs prima facie material to have a reason to believe income has escaped assessment. Conclusive proof or evaluation of the sufficiency and correctness of such material is not required at the stage of issuing the notice.

Judgments on Section 68

Enlighten Lifestyle Ltd, Mumbai vs. ITO 12(3)(2), Mumbai

In the result, this appeal by the assessee stands allowed

ITA 3436/MUM/2017[2012-13]Status: DisposedITAT Mumbai08 Jan 2018AY 2012-13

Bench: Shri Shamim Yahyaआयकर अपील सं./I.T.A. No. 3436/Mum/2017 ("नधा"रण वष" / Assessment Year:2012-13) M/S. Enlighten Lifestyle Limited Ito-12(3)(2), (Erstwhile Kornerstone Retail Limited) Mumbai बनाम/ B-101, Synthofine Estate, Vs. Opp. Virnani Industrial Estate, Goregaon (E), Mumabi-400 063 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aacck 5467 D (अपीलाथ" /Appellant) (""यथ" / Respondent) : अपीलाथ" क" ओर से / Appellant By : Shri Chaitanya Joshi & Ms. Ayushi Madani ""यथ" क" ओर से/Respondent By : Ms. N. Hemalatha सुनवाई क" तार"ख / : 08.11.2017 Date Of Hearing घोषणा क" तार"ख / : 08.01.2018 Date Of Pronouncement आदेश / O R D E R Per Shamim Yahya, A. M.: This Appeal By The Assessee Is Directed Against The Order Of The Ld. Commissioner Of Income Tax (Appeals)-20, Mumbai Dated 02.02.2017 & Pertains To The Assessment Year 2012-13. 2. The First Issue Raised Relates To The Disallowance Of Interest Income From Fixed Deposits Amounting To Rs.40,10,535/-, As Income From Other Sources As Against The Income From Profit & Gains From Business & Profession Treated By The Assessee.

For Appellant: Shri Chaitanya Joshi &For Respondent: Ms. N. Hemalatha

Sri Amitava Banerjee, Durgapur vs. DCIT, Circle-2, Kolkata, Durgapur

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

ITA 567/KOL/2017[2010-11]Status: DisposedITAT Kolkata05 Jan 2018AY 2010-11

Bench: Hon’Ble Shri P.M. Jagtap] I.T.A. No. 567/Kol/2017 Assessment Year : 2010-11 Shri Amitava Banerjee.............................……………………………………………..Appellant C/O. V.N. Purohit & Co., Chartered Accountants, A-4, Nandalal Bithi, City Centre, Ground Floor, Durgapur – 713 216 [Pan : Ahnpb 7336 E] D.C.I.T., Cir - 2...................………………………………………………......................Respondent Aayakar Bhawan, Aayakar Bithi, Durgapur – 713 216 Appearances By: Shri V.N. Purohit, Ca Appearing On Behalf Of The Assessee. Shri Soumyajit Dasgupta, Addl. Cit Appearing On Behalf Of The Revenue. Date Of Concluding The Hearing : November 01, 2017 Date Of Pronouncing The Order : January 05, 2018 Order This Appeal Filed By The Assessee Is Directed Against The Order Of Ld. Cit (Appeals), Durgapur Dated 18.01.2017 & The Grounds Raised By The Assessee Therein Read As Under: “1. That The Cit(A) Has Erred Both In Law & On Facts, In Not Giving Any Decision On Ground No 1 Which Read As Follows: I. That The Notice Issued U/S 148 Is Bad In Law & On The Facts & Circumstances Of The Case. 2. That The Cit(A) Has Likewise Erred In Making An Addition Of Rs. 23,77,816/- (Wrongly Stated In Ground As Rs. 13,90,737/-) Being Profit On Sale Of Agricultural Land. 3. That The Cit(A) Has Likewise Further Erred In Confirming Following Adhoc Disallowances Made By Assessing Officer. (A) Out Of Car Expenses Rs. 25,000/- (B) Out Of Maintenance Cost Of Officer Equipment Rs. 50,000/- (C) Expenses On Staff Training Rs. 88,400/- (D) Loss On Sale Of Asset Rs. 34,679/-

Section 148Section 54Section 54B

Gaurav Baheti, Kolkata vs. ITO, Ward-29(4), Kolkata

In the result, the appeal of the assessee is allowed

ITA 1874/KOL/2017[2012-13]Status: DisposedITAT Kolkata05 Jan 2018AY 2012-13

Bench: Hon’Ble Shri P.M. Jagtap] I.T.A. No. 1874/Kol/2017 Assessment Year : 2012-13 Shri Gaurav Baheti.............................………………………………………………...Appellant Flat No. 5A&B, Mangalam, 33, Raja Santosh Road Kolkata – 700 027 [Pan : Aggpb 5610 B] I.T.O., Ward 29(4).Kolkata...................………………………………………….Respondent Aayakar Bhawan, Dakshin, 2, Gariahat Road (S), Kolkata – 700 068 Appearances By: Shri Raj Kumar Patodi, Fca Appearing On Behalf Of The Assessee. Shri Sailen Samaddar, Addl. Cit, Sr. Dr Appearing On Behalf Of The Revenue. Date Of Concluding The Hearing : November 28, 2017 Date Of Pronouncing The Order : January 05, 2018 Order This Appeal Filed By The Assessee Is Directed Against The Order Of Ld. Cit (Appeals) - 18 Kolkata Dated 04.07.2017 & The Solitary Issue Involved Therein Relates To The Addition Of Rs. 12,12,000/- Made By The A.O. & Confirmed By The Ld. Cit(A) On Account Of Unexplained Cash Credit Under Section 68 Of The Income Tax Act, 1961. 2. The Assessee In The Present Case Is An Individual Who Is An Employee Of M/S. Seacem Paints (I) Pvt. Ltd. He Filed His Return Of Income For The Year Under Consideration On 07.01.2013 Declaring A Total Income Of Rs. 2,81,015/- Comprising Of The Salary Income & Income From Other Sources. As Per The Air Information Received By The A.O., The Assessee Had Made Cash Deposits Aggregating To Rs. 12,12,000/- In His Bank Account Maintained With Axis Bank

Section 143(3)Section 68

ITO 1(1)(1), Mumbai vs. Art Housing P. Ltd, Mumbai

In the result, this appeal filed by the Revenue stands allowed

ITA 522/MUM/2017[2009-10]Status: DisposedITAT Mumbai04 Jan 2018AY 2009-10

Bench: Shri Shamim Yahyaआयकर अपील सं./I.T.A. No.522/Mum/2017 ("नधा"रण वष" / Assessment Year: 2009-10) Ito-1(1)(1), M/S. Art Housing Pvt. Ltd. 534, Aayakar Bhawan, Block No. 302, Mehta Business बनाम/ M. K. Road, Mumbai-400 020 Centre, Khaitan Chambers, Vs. 143/145, Modi Street, Fort, Mumbai-400 001 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aahca 6007 F (अपीलाथ" /Appellant) (""यथ" / Respondent) : अपीलाथ" क" ओर से / Appellant By : Ms. N. Hemalatha ""यथ" क" ओर से/Respondent By : Shri Dharan Gandhi & Shri Vishesh Sangoi सुनवाई क" तार"ख / : 11.10.2017 Date Of Hearing घोषणा क" तार"ख / : 04.01.2018 Date Of Pronouncement आदेश / O R D E R Per Shamim Yahya, A. M.: This Appeal By The Revenue Is Directed Against Order Of The Ld. Commissioner Of Income Tax (Appeals) Dated 26.01.2016 & Pertains To Assessment Year 2009-10. 2. The Grounds Of Appeal Read As Under: I. "Whether, On The Facts & Circumstances Of The Case & In Law, The Cit(A) Was Justified In Directing The Deletion Of The Sum Brought To Tax By The 2 Ito Vs. M/S. Art Housing Pvt. Ltd. Ao As Unexplained Income Under Section 68 Of The Income Tax Act, 1961 In Respect Of Moneys Credited In The Books As Share Application Money Rs.45,00,000?"

For Appellant: Ms. N. HemalathaFor Respondent: Shri Dharan Gandhi &
Section 68