Section-105: Unexplained expenditure

Section-105 : Unexplained expenditure

Section-105 provides for the circumstances or conditions in which any expenditure incurred by the assessee shall be deemed to be unexplained expenditure and be included in the total income of the assessee. Learn to understand the section-105 as it is, it's help and useful links to follow.

Here onwards, "Act" refers to "Income Tax Act 2025"

1. Section-105 as per act

Where any expenditure has been incurred by the assessee in any tax year, and––
1. the assessee offers no explanation about the source of such expenditure or part thereof; or
2. the explanation offered by the assessee is not satisfactory in the opinion of the Assessing Officer,
then, the amount covered by such expenditure or part thereof, shall be deemed to be the income of the assessee for that tax year.
Irrespective of any other provision of this Act, the amount deemed as income in sub-section (1) shall not be allowed as a deduction under this Act.