Section 103
Section 103: unexplained investment
Section 103 targets investments that do not appear in an assessee's books of account, or that exceed the amount actually recorded there. If the assessee cannot satisfactorily explain the nature and source of such an investment (or the excess amount), it is deemed to be the assessee's income for that tax year.
What Section 103 says
Where in any tax year an assessee has made an investment that is not recorded in the books of account (if any) maintained for any source of income, or the Assessing Officer finds that the amount of an investment exceeds the amount recorded in the books, and the assessee either offers no explanation about the nature and source of the investment or excess amount, or the explanation offered is not found satisfactory by the Assessing Officer, then the value of the investment, or the excess amount, is deemed to be the assessee's income for that tax year.
Frequently asked questions
What triggers Section 103?
An investment made by the assessee that is either not recorded at all in their books of account, or is recorded at a lower value than what the Assessing Officer finds was actually invested.
What if I can explain the investment's source?
If the explanation about the nature and source of the investment (or the excess amount) is found satisfactory by the Assessing Officer, Section 103 does not apply to deem it as income.
Related sections
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Get help responding to an unexplained investment queryLast updated 9 September 2026