Section 68 Revisited

This ruling is a comprehensive reaffirmation of the classic three-fold test under Section 68. The Tribunal dismantled additions built on suspicion, alleged dummy directors, and borrowed conclusions from third-party assessments. 

It emphasized that NBFC status, audited financials, banking channels, and repayment patterns constitute strong evidence of genuineness. Importantly, it reiterated that “source of source” is not required unless specifically mandated, and that absence of incriminating material during search weakens the Revenue’s case. 

The decision also highlights the evidentiary value of independent inquiry under Section 250(4).