Tax Publishers Income From Undisclosed Sources & Taxation Under Section 115BBE by CA Nisha Bhandari Edition 2025

Part I – Income from Undisclosed Sources

Section A – Introductory

1. Deemed Income under Sections 68 to 69D
2. Taxation of Incomes Referred to in Sections 68 to 69D

Section B – Cash Credits [Section 68] 3. Chargeability under Section 68 4. Nature, Scope and Mandate of Section 68 5. Scope of First Proviso to Section 68 6. Scope of Second and Third Proviso 7. Maintenance of Books of Accounts—Condition Precedent for Invoking Section 68 8. Approach of Assessing Officer While Invoking Section 68 9. Onus to Prove Regarding Cash Credit 10. Shifting of Burden of Proof to Revenue 11. Role of Assessee’s Explanation Regarding Credit Entries 12. Examination As to Genuineness of Cash Credit 13. Justification of Addition under Varying Circumstances 14. Long Term Capital Gain on Penny Stocks Vis-a-Vis Addition under Sec. 68 15. Telescoping of Intangible Additions 16. Applicability of Peak Credit Theory 17. Cash Credit Vis-a-Vis Partnership Firm 18. Share Capital of Companies and Cash Credit 19. Burden to Prove Source of Share Capital Etc., in Hands of Investors in Case of Closely Held Companies 20. Shell Companies Vis-a-Vis Addition under Section 68 21. Addition under Section 68 Vis-a-Vis Donation in Hands of Charitable Trusts and Institutions 22. Cash Deposits under Varying Fact Situations Vis-a-Vis Addition under Section 68 23. Cash Credit Perspective in Estimation of Business Income 24. Tribunal’s Finding Vis-a-Vis Cash Credit 25. Powers and Duties of Assessing Officer While Invoking Section 68 Provision

Section C – Loans and Cash Credits 26. Dealing with Unsecured Loans 27. Burden to Prove Genuineness of Unsecured Loans 28. Source of Source Whether Required to be Proved 29. Issuance of Summons to Loan Creditors 30. Unsecured Loan from Family Members—Determination of Its Genuineness 31. Justification of Addition on Account of Unsecured Loans

Section D – Conveyancing Solutions in Cash Credits Specific Matters 32. Notice Vis-a-Vis Cash Credits 33. Specimen Replies Under Varying Circumstances

Section E – Unexplained Investments [Section 69] 34. Addition under Section 69 35. Burden of Proof and Opportunity of Hearing 36. Justifiability or Otherwise of Addition under Section 69 37. Addition under Section 69 Vis-a-Vis Construction Cost 38. Addition under Section 69 Consequent to Search, Seizure and Survey Proceedings 39. Addition on Account of Unexplained Jewellery 40. Addition on Account of Unaccounted Sales and Bogus Purchases 41. Excess Stock Vis-a-Vis Addition under Section 69 42. Undisclosed or Unexplained Investment in Property 43. Unexplained Deposit in Bank Account 44. Unexplained Investments in Shares, Bonds, FD’s, Etc. 45. Miscellaneous Fact Situations and Addition under Section 69 46. Conveyancing as to Section 69

Section F – Unexplained Money, Jewellery, Etc. [Section 69A] 47. Addition under Section 69A 48. Presumption As to Ownership 49. Opportunity of Hearing and Burden of Proof 50. Addition on Account of Unexplained Jewellery 51. Cases of Unexplained Cash 52. Justifiability or Otherwise of Addition under Section 69A 53. Conveyancing As to Section 69A

Section G – Amount of Investments, Etc., Not Fully Disclosed in Books of Accounts [Section 69B] 54. Addition under Section 69B 55. Addition under Section 69B Where Not Sustainable 56. Additions under Section 69B Where Sustainable 57. Conveyancing As to Section 69B

Section H – Unexplained Expenditure and Bogus Purchases [Section 69C] 58. Addition on Account of Unexplained Expenditure 59. Addition Towards Bogus Purchases 60. Conveyancing As to Section 69C

Section I – Amount Borrowed or Repaid on Hundi [Section 69D] 61. Addition of Hundi Amount under Section 69D 62. Conveyancing As to Section 69D

Section J – Gifts and Treatment Thereof as Undisclosed Income 63. Section 68 Vis-a-Vis Section 56(2) 64. Burden to Prove As to Genuineness of Gift 65. Justification of Addition on Account of Non-Genuine Gift 66. Addition on Account of Gift Where Held Not Sustainable 67. Addition on Account of NRI Gift 68. Gift Vis-a-Vis Addition under Section 68/69/69A/69B/69C 69. Necessity of Opportunity of Hearing

Section K – Demonetisation Vis-a-Vis Income From Undisclosed Sources 70. Addition in Wake of 2016 Demonetisation 71. Applicability of Section 68 or Section 69A in Demonetisation Cases 72. Post Demonetisation Cash Deposit Consequences 73. Addition on Account of Cash Deposit During Demonetisation—Cases Helpful While Contesting Addition 74. Acceptance of Old Currency Notes Against Sales After Becoming Illegal Tender—Related Issues 75. Queries and Reply Vis-a-Vis Demonetisation Cases 76. Deposit of High Denomination Note in Wake of Earlier Demonetisation Scenario Vis-a-Vis Income from Undisclosed Sources 77. Declaration under Voluntary Disclosure Schemes During Demonetisation Vis-a-Vis Addition under Section 68 78. Declaration under Vivad Se Vishwas Scheme, 2024

Part II – Taxation Under Section 115BBE and Penal Consequences 79. Introduction of Taxation at Special Rate under Section 115BBE 80. Scheme of Taxation under Section 115BBE 81. No Deduction or Set Off of Loss Out of Deemed Income Referred to under Sections 68 to 69D 82. Unexplained Income Liable to Taxation under Section 115BBE—Nature and Instances 83. Cash Sales Vis-a-Vis Applicability of Section 115BBE 84. Surrender of Income in Search or Survey and Applicability of Section 115BBE 85. Non-Applicability of Section 115BBE Where Income Classified as Business Income 86. Penalty when Leviable under Section 271AAC 87. Penalty Leviable under Section 271AAB Where Undisclosed Income Found During Search 88. Penalty Leviable under Section 271AAD Where False Entry Fake Invoice Etc., Found While Invoking Addition for Undisclosed Income

Part III – Treatment of Cash Transactions

Section A – Disallowance of Cash Payments Under Section 40A(3) 89. Disallowance Provision under Section 40A(3) 90. Scope and Applicability of Section 40A(3) 91. Issues Relevant to Section 40A(3) As Clarified by CBDT Via Various Circulars 92. Exceptional Circumstances As Per Rule 6DD

Section B – Acceptance or Repayment of Loan/Deposit/Specified Sum or Advances in Cash [Sections 269SS & 269T] 93. Restriction on Acceptance and Taking of Loan, Deposits or Specified Sum [Section 269SS] 94. Bar to Repayment of Loan or Deposit or Specified Advance in Cash [Section 269T] 95. Escapement From Penalty under Sections 271D and 271E Owing to Reasonable Cause

Section C – Miscellaneous Issues Vis-a-Vis Cash Transactions 96. Restriction on Cash Receipts under Section 269ST 97. Acceptance of Payment Through Prescribed Electronic Modes [Section 269SU] 98. Certain Other Disincentives for Cash Transactions 99. Income Tax Act, 1961 Vis-a-Vis Income Tax Bill, 2025