Section 69A

Section 68, 69, 69A, 69B and 69C of Income Tax Act, 1961

Income Tax - Comparison between section 68, section 69, section 69A, section 69B and section 69C: -So far as section 68 is concerned, the onus is wholly upon the Assessee to explain the source of the entry. But in cases falling under section 69, 69A, 69B and 69C, the words used show that before any of these sections are invoked, the condition preceden...

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Taxation of Unexplained Incomes

Income Tax - Background To begin with, the unexplained income simply means any income for which assessee do not have valid explanation about the nature and / or source or the assessing officer is not satisfied with the explanation provided by the assessee. Under the provisions of Income-tax Act, 1961 (the Act) broadly, the term ‘unexplained incomeâ€...

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Taxation of Deposits Made With Banks in SBNs

Income Tax - The Income Tax Returns for the Assessment Year 2017-18 were selected for scrutiny via e-proceedings for those Assessees, who have deposited more than Rs. 2 Lakhs in cash in Banks after 8th November 2016, being the date on which Demonetization was announced by our honourable Prime Minister of India. Cash Books, Sales Invoices, Copies of [&...

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Assessment of Cash Deposits in OCM Cases

Income Tax - A large number of assessments pertaining to cash deposited in banks during demonetization period are pending. The article analysis relevant sections of I.T. Act as well as various legal issues to assist assessing officers in passing error free sustainable assessment orders....

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Understanding Applicability of Section 115BBE

Income Tax - Post-demonetization in FY 2016–17, there has been large scale cash deposits in bank accounts, out of which a substantial portion could be unexplained u/s 69A. Such income in nature of Ss. 68 to 69D has been made liable for being taxed at higher rate @ 60% u/s 115BBE from AY 2017–18, irrespective of whether such unexplained income is s...

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HC upheld Tribunal decision of estimating Profit @2% of Total Credits

PCIT Vs Shitalben Saurabh Vora (Gujarat High Court) - PCIT Vs Shitalben Saurabh Vora (Gujarat High Court) The issue in the present case relates whether the amount deposited by the assessee in the form of cash/cheques represents the income of the assessee. Admittedly, there was huge deposit of cash/cheques in the bank account of the assessee. But on per...

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Asking to prove 92% of expense defeats purpose of presumptive taxation: ITAT Bangalore

Shri Kokkarne Prabhakara Vs. ITO (ITAT Bangalore) - Shri Kokkarne Prabhakara Vs. ITO (ITAT Bangalore) Asking the assessee to prove to the satisfaction of the Assessing Officer, the expenditure to the extent of 92% of gross receipts, would also defeat the purpose of presumptive taxation as provided under section 44AD of the Act or other such provision...

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Section 69A Addition based on deposits in bank by ignoring withdrawals was not justified

Sanjay Jain Vs ITO (ITAT Delhi) - Sanjay Jain Vs ITO (ITAT Delhi) The issue under consideration is whether the addition made under Section 69A of the Act to the income of the assessee is tenable?  It is the submission of the ld. Counsel for the assessee that the assessee has shown a GP rate of 20.89% and, therefore, the same rate [...

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Addition u/s sec. 69A justified for bogus LTCG from penny stocks

Pooja Ajmani Vs ITO (ITAT Delhi) - Assessee was not entitled to claim long term capital gain as exempt u/s 10(38) and the same was deemed to be income under section 69A as it was revealed that purchase and sale of shares were arranged transactions by assessee to create bogus profit in the garb of tax exempt long term capital gain by ...

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Addition U/s. 69A can only be made when assessee found to be in possession of money bullion jewellery, etc., not recorded in his books of account

Dy. Commissioner of Income Tax Vs M/s. Karthik Construction Co. (ITAT Mumbai) - DCIT Vs M/s. Karthik Construction Co. (ITAT Mumbai) As could be seen, the Assessing Officer raised suspicion on the loan repayment by doubting the genuineness of the unsecured loan availed by the assessee against which such loan repayment was made. However, as per the facts on record, unsecured loan...

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Recent Posts in "Section 69A"

HC upheld Tribunal decision of estimating Profit @2% of Total Credits

PCIT Vs Shitalben Saurabh Vora (Gujarat High Court)

PCIT Vs Shitalben Saurabh Vora (Gujarat High Court) The issue in the present case relates whether the amount deposited by the assessee in the form of cash/cheques represents the income of the assessee. Admittedly, there was huge deposit of cash/cheques in the bank account of the assessee. But on perusal of the bank statement, it […...

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Asking to prove 92% of expense defeats purpose of presumptive taxation: ITAT Bangalore

Shri Kokkarne Prabhakara Vs. ITO (ITAT Bangalore)

Shri Kokkarne Prabhakara Vs. ITO (ITAT Bangalore) Asking the assessee to prove to the satisfaction of the Assessing Officer, the expenditure to the extent of 92% of gross receipts, would also defeat the purpose of presumptive taxation as provided under section 44AD of the Act or other such provision. Since the scheme of presumptive taxati...

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Section 68, 69, 69A, 69B and 69C of Income Tax Act, 1961

Comparison between section 68, section 69, section 69A, section 69B and section 69C: -So far as section 68 is concerned, the onus is wholly upon the Assessee to explain the source of the entry. But in cases falling under section 69, 69A, 69B and 69C, the words used show that before any of these sections are invoked, the condition preceden...

Read More

Taxation of Unexplained Incomes

Background To begin with, the unexplained income simply means any income for which assessee do not have valid explanation about the nature and / or source or the assessing officer is not satisfied with the explanation provided by the assessee. Under the provisions of Income-tax Act, 1961 (the Act) broadly, the term ‘unexplained incomeâ€...

Read More
Posted Under: Income Tax |

Section 69A Addition based on deposits in bank by ignoring withdrawals was not justified

Sanjay Jain Vs ITO (ITAT Delhi)

Sanjay Jain Vs ITO (ITAT Delhi) The issue under consideration is whether the addition made under Section 69A of the Act to the income of the assessee is tenable?  It is the submission of the ld. Counsel for the assessee that the assessee has shown a GP rate of 20.89% and, therefore, the same rate […]...

Read More

Taxation of Deposits Made With Banks in SBNs

The Income Tax Returns for the Assessment Year 2017-18 were selected for scrutiny via e-proceedings for those Assessees, who have deposited more than Rs. 2 Lakhs in cash in Banks after 8th November 2016, being the date on which Demonetization was announced by our honourable Prime Minister of India. Cash Books, Sales Invoices, Copies of [&...

Read More
Posted Under: Income Tax |

Assessment of Cash Deposits in OCM Cases

A large number of assessments pertaining to cash deposited in banks during demonetization period are pending. The article analysis relevant sections of I.T. Act as well as various legal issues to assist assessing officers in passing error free sustainable assessment orders....

Read More
Posted Under: Income Tax |

Understanding Applicability of Section 115BBE

Post-demonetization in FY 2016–17, there has been large scale cash deposits in bank accounts, out of which a substantial portion could be unexplained u/s 69A. Such income in nature of Ss. 68 to 69D has been made liable for being taxed at higher rate @ 60% u/s 115BBE from AY 2017–18, irrespective of whether such unexplained income is s...

Read More
Posted Under: Income Tax |

Addition u/s sec. 69A justified for bogus LTCG from penny stocks

Pooja Ajmani Vs ITO (ITAT Delhi)

Assessee was not entitled to claim long term capital gain as exempt u/s 10(38) and the same was deemed to be income under section 69A as it was revealed that purchase and sale of shares were arranged transactions by assessee to create bogus profit in the garb of tax exempt long term capital gain by well organised network of entry provider...

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Addition U/s. 69A can only be made when assessee found to be in possession of money bullion jewellery, etc., not recorded in his books of account

Dy. Commissioner of Income Tax Vs M/s. Karthik Construction Co. (ITAT Mumbai)

DCIT Vs M/s. Karthik Construction Co. (ITAT Mumbai) As could be seen, the Assessing Officer raised suspicion on the loan repayment by doubting the genuineness of the unsecured loan availed by the assessee against which such loan repayment was made. However, as per the facts on record, unsecured loans which were repaid by the assessee [&he...

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Section 68: Provisions related to Cash Credits /Undisclosed Income

Section 68 incorporates only a rule of evidence, placing the onus of proof on the assessee. There have been hardly any amendments in this section since its introduction....

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Posted Under: Income Tax |

Addition U/s. 69A not sustainable if based on mere loose sheet found in third person premises

Riveria Properties (P) Ltd. Vs. ITO (ITAT Mumbai)

These are appeals filed by the assessee directed against the order of Commissioner (Appeals)-13, Mumbai and order of the Commissioner (Appeals)-14, Mumbai dated 28-1-2016 for the assessment year 2006-07. Since facts are identical and issues are common, these appeals were heard together and are disposed of by this common order, for the sak...

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Budget 2018 Rationalises provisions of section 115BBE

Sub-section (2) of said section provides that no deduction in respect of any expenditure or allowance or set-off of any loss shall be allowed to the assessee under any provision of the Act in computing his income referred to in clause (a) of sub-section (1)....

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Posted Under: Income Tax |

Deposit in bank not explained satisfactorily is unexplained credit U/s. 69A

Shri Parbat M. Chamriya Vs Income Tax Officer (ITAT Mumbai)

The assessee has failed to bring on record any evidence to establish his claims that the deposits in the ICICI Bank, saving bank account at Khar (W), Mumbai was out of receipts connected with his business transactions...

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S.69A: No addition where no money/bullion found in possession

ITO Vs Shri Parvez Mohammed Hussain Ghaswala (ITAT Mumbai)

For invoking provisions of section 69A assessee should be the owner of any money, bullion, jewellery or any other valuable articles. In this case of assessee he was not found to be the owner of any money, bullion, jewellery or any other valuable articles....

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No Set off of losses against deemed undisclosed income

In order to avoid unnecessary litigation, it is proposed to amend the provisions of the sub-section (2) of section 11 5BBE to expressly provide that no set off of any loss shall be allowable in respect of income under the sections 68 or section 69 or section 69A or section 69B or section 69C or section 69D....

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Posted Under: Income Tax |

Sec.69A–Deeming provision cannot be initiated based on suspicion

CIT Vs Shri Jawahar Lal Oswal & others (Punjab & Haryana High Court)

Suspicion and doubt may be the starting point of an investigation but cannot, at the final stage of assessment, take the place of relevant facts, particularly where a deeming provision is sought to be invoked....

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If assessee merely acted as a conduit without any right in money, no addition can be made u/s 69A

M/s Bhagwati Motors Vs ITO (ITAT Chandigarh)

In the case of M/s Bhagwati Motors Vs. ITO Chandigarh bench of ITAT have held that Assessee merely acted as a conduit without any right in money, therefore, no addition under section 69A of the Act could be made against the assessee....

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