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

Dgm Tubes Pvt.Ltd, Pune vs. Income-Tax Officer, Ward - 8 (4), Pune

The appeal of the assessee is allowed in aforestated terms

ITA 579/PUN/2019[2008-09]Status: DisposedITAT Pune11 Oct 2022AY 2008-09

Bench: Shri Ss Vishwanethra Ravi & Shri G. D. Padmahshaliआयकर अपीऱ सं. / Ita No.579/Pun/2019 निर्धारण वर्ा / Assessment Year : 2008-2009 Dgm Tubes Pvt. Ltd. B/13, Sanghvi Street Compound, 128/3, Mohan Nagar, Chinchwad, Pune. . . . . . . . अपीऱधर्थी / Appellant Pan: Aaccd5626N बनाम / V/S. Income Tax Officer, . . . . . . . . प्रत्यर्थी / Respondent Ward-8(4), Pune द्वारा / Appearances Assessee By : Shri V. L. Jain Revenue By : Shri Ramnath Murkunde सुनवाई की तारीख / Date Of Conclusive Hearing : 11/10/2022 घोषणा की तारीख / Date Of Pronouncement : 11/10/2022 आदेश / Order Per G. D. Padmahshali, Am; By The Present Appeal, The Assessee Challenged The Order Of Commissioner Of Income Tax (Appeals)-13, Pune [For Short “Cit(A)”] Dt. 3101/2019 Passed U/S 250 Of The Income-Tax Act, 1961 [For Short “The Act”], Which Flown Out Of Assessment Order Dt. 26/02/2016 Passed U/S 143(3) R.W.S. 147 Of The Act, By The Income Tax Officer, Ward-8(4), Pune [For Short “Ao”] For Assessment Year [For Short “Ay”] 2008-09. Itat-Pune Page 1 Of 4

For Appellant: Shri V. L. JainFor Respondent: Shri Ramnath Murkunde
Section 143(3)Section 148Section 250Section 68

M/S Desun Healthcare and Research Institute Ltd., Kolkata vs. D.C.I.T., Circle-12(1), Kolkata

In the result, appeal of the assessee is partly allowed

ITA 530/KOL/2019[2015-16]Status: DisposedITAT Kolkata10 Oct 2022AY 2015-16

Bench: Shri Sanjay Garg & Shri Girish Agrawalassessment Year: 2015-16 Desun Healthcare & Deputy Commissioner Of Research Institute Ltd. Income-Tax, Circle-12(1), Vs. (Pan: Aaccn0884A) Kolkata. 8/1A/1, Keyatalla Road, Kolkata-700029. (Appellant) (Respondent) Present For: Appellant By : Shri Manoj Kataruka, Advocate Respondent By : Md. Ghayas Uddin, Cit, Dr Date Of Hearing : 18.08.2022 Date Of Pronouncement : 10.10.2022 O R D E R Per Girish Agrawal: This Appeal By The Assessee Is Arising Out Of The Order Of Commissioner Of Income-Tax(Appeals) – 4, Kolkata In Appeal Number 74/Cit(A)-4/C-12(1)/17-18 Dated 31.01.2019 Against The Assessment Order Passed Under Section 143(3) Of The Income-Tax Act, 1961 (Hereinafter Referred To As The Act) By Dcit, Circle – 12(1), Kolkata, Dated 21.12.2017. 2. Grounds Of Appeal Taken By The Assessee Are Reproduced As Under: “1. That On The Facts & In The Circumstances Of The Case The Action Of The Ld. Clt(A) To Confirm The Addition Made By The Ao. Is Without Providing Reasonable Opportunity Of Being Heard In Violation Of The Principles Of Natural Justice & Therefore The Order Passed Is Bad In Law. 2. That On The Facts & In The Circumstances Of The Case The Action Of The Ld. Cit(A) To Confirm The Addition Made By The Ao. By Passing An Ex-Parte Order Is Without Considering The Submissions Recorded In The Statement Of Facts & In Violation Of The Principles Of Natural Justice Without Providing Reasonable Opportunity Of Being Heard & Therefore The Order Passed Is Arbitrary, Excessive & Illegal.

For Appellant: Shri Manoj Kataruka, AdvocateFor Respondent: Md. Ghayas Uddin, CIT, DR
Section 115JSection 143(3)Section 14A