BARIK BISWAS,NORTH TWENTY FOUR PARGANAS vs. D.C.I.T., CIRCLE - 49(1),, KOLKATA

Per Rajesh Kumar, AM:

This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 16.12.2025 for the AY 2013-14.

“4. For that the ld. CIT (A) erred in confirming the order of ld. AO when the proceedings u/s 148 of the Act were not validly initiated and therefore the action u/s 148 is itself as bas in law.” 3. The facts in brief are that the return of income was filed by the assessee on 11.03.2014, declaring total income at

i. Mahesh Kumar Gupta vs. Commissioner of Income- tax [2013] 33 taxmann.com 409 (Allahabad/ [2014] 363 ITR 300 (Allahabad)[17-04-2013]

ii. M/s Narayani Global Vs. ITO in ITA No. 57/KOL/2026 vide order dated 20.05.2026.

iii. PCIT Vs. BoothnathVintrade Private Limited reported in ITAT/297/2025 IA no. GA/1/2024, Pronounced on 14.11.2025.

iv. Quadeye Securities Pvt. Ltd vs DCIT vide ITA No. 792/Kol/2024 pronounced on 07.10.2024.

v. Faithful Dealers Pvt. Ltd vs ITO vide ITA No. 1285/Kol/2025 pronounced on 07.11.2025.

vi. CIT(EXEMPTION) vs B.P Poddar Foundation for Education reported in ITAT/143/2021, IA No. GA/02/2021 pronounced on 13.09.2022.

vii. CIT vs M/s Infinity Infotech Parks Ltd. reported in ITAT No. 60 of 2014, G.A No. 1736 of 2014

viii. DCIT vs SRMB Srijan Private Limited vide ITA No. 1683/KOL/2024 pronounced on 26.08.2025

ix. Ganesh Steel & Alloys Limited vs DCIT vide ITA No. 929/Kol/2023 pronounced on 11.06.2024.

“12.03.2015 Huge cash deposits in bank accounts of the assessee were found which are pertaining to the F.Y. 2012-13 and which are unexplained. In view of these facts, I have reason to believe that there is escapement of income of more than ₹1,00,000/-. The case is reopened u/s 147 and notice u/s 148 is issued.” 6. In our opinion, the powers u/s 147 are conferred on the tax authorities to reopen the cases, where the income has escaped genuinely after recording reasons to believe which have to be objective recorded and reopening on the basis of such vague , non-speaking and scanty reasons is not permissible under the Act. We note that even no quantification of escapement of income and no mention of cash deposits into bank accounts of the assessee were there

“14. None of the judgments referred to above have any connection to the point in issue even remotely. They relate either to the question of non- disclosure of income or failure on the part of the assessee to disclose the income fully or truly and what amounts to "reason to believe an information". None of these points were urged before us and we failed to understand the filing of the rulings by the counsel as referred to herein above. 15. The only point urged and pressed before us is whether in absence of anything in the reasons recorded to suggest that the income chargeable to tax which has escaped the assessment is Rs. one lakh or more having not been mentioned the reassessment notice given after four years of the close of the assessment order is valid or not. 16. For the reasons given above, we find sufficient force in the argument of the learned counsel for the petitioner that on the basis of the reasons recorded by the Assessing Officer, the initiation of the reassessment proceedings relevant to the Assessment Year 2000-2001 by means of the notice dated 23.3.2007 after more than four years is clearly barred by time. 17. In the result, all the three writ petitions succeed and are allowed and the impugned notices dated 23rd of March, 2007 are hereby quashed.” 7. In case of M/s Narayani Global Vs. ITO in ITA No. 57/KOL/2026 vide order dated 20.05.2026, the co-ordinate Bench has held as under:-

“6. After hearing the rival contentions and perusing the materials available on record, we find the case of the assessee was reopened by issuing notice u/s 148 of the Act dated 15.04.2021, during TOLA period. Thereafter, a show cause notice was issued u/s 148A(b) of the Act dated 26.05.2022, which was replied by the assessee and thereafter, after taking into consideration the reply filed by the assessee, an order was passed u/s

“6. Considering the facts on record and the contents of the reasons to believe recorded by the Ld. AO coupled with his general and casual observations without the conduct of any examination or verification as well as judicial precedents referred above, we hold that the crucial link between the information made available to the AO and the formation of belief is absent. There is no independent application of mind by the AO. Accordingly, the initiation of proceedings u/s. 147 r.w.s. 148 to reopen the assessment does not satisfy the requirements of the law. Ground no. 4 of appeal is on the legal issue is allowed. Since no submissions have been made by both the parties on the merits of the case and the legal issue is allowed in favour of the assessee and remaining grounds are rendered academic in nature, hence, not adjudicated upon. 7. In the result, the appeal of the assessee is allowed.” 9. In case of Quadeye Securities Pvt. Ltd vs DCIT vide ITA No. 792/Kol/2024 pronounced on 07.10.2024, the co-ordinate bench has held as under:-

”6. We have considered the rival contentions and gone through the record. We note that under the relevant provisions of section 147 & section 148 of the Income Tax Act, for assuming jurisdiction to reopen an assessment by the Assessing Officer, there is a condition precedent that the Assessing Officer must have reasons to believe that the income of the assessee for that year has escaped assessment. It has been held time and again that the reasons to believe regarding the escapement of the income should be based on certain tangible material and it should not be mere pretence of the Assessing Officer. The reasons to believe does not mean reasons to suspect. Reopening of the

“7. Upon hearing submission of the counsels of the respective parties and perused the material available on record, we find that in the instant case, the Assessing Officer assumed jurisdiction by issuing notice u/s 148 of the Act on 30.03.2019 on the following grounds: In this case, the assessee company has electronically furnished the return of Income for the A.Y. 2012-13 on 29-09-2012 declaring total income of at Rs/ 2.68,700/-. The same was processed u/s. 143(1) by CPC Bengaluru on 22-02-2013. On the basis of enquiry and information in possession of the undersigned, it is seen that, during the FY. 2011-12, the assessee company current bank account No.03222090005940 got credit of Rs.13.25 lakhs through cheque deposit, Rs.215 lakhs through RTGS and Rs.26 lakhs through fund transfer from different entities and subsequently funds were transferred to other entities. Also, on various occasions the credited fund is auto transferred to Term Deposit. The assessee had Term Deposit of Rs. 1.24,00,000/- during the FY 2011- 12. From the analysis of the return of the assessee for A.Y. 2012-13, it is seen that the company had shown income of Rs.2,68,703/- under the head business and profession only and no investment is shown. This clearly shows that the assessee had suppressed Investment made during the FY. 2011-12 and further amount of Rs.1,56,00,000/- credited in the bank account of the assessee remained unexplained. Hence, on the basis of information correlated and analysis done I am of the view that the assessee has not disclosed its true and full accounts, therefore, I have reason to believe that the assessee income of Rs.1,56,00,000/- has escaped assessment....... 7.1 While perusing the assessment order, we find that it has been stated as “As per information received from the Investigation wing,Kolkata the

“8. After we have elaborately heard the learned Advocates on either side, we note that the case of the revenue rests upon the decision in N. Govindaraju (supra) in which the Court had taken note of and followed the decisions in Majinder Singh Kang (supra) Atlas Cycle Industries (supra) and CIT v. Mehak Finvest (P.) Ltd. [2014] 52 taxmann.com 51/367 ITR 769/[2015] 274 CTR 189 (Punj. & Har.). 9. In N. Govindaraju (supra) it was held that "reason to believe" that any income chargeable to tax had escaped assessment is one aspect of the matter; if reason exists, the Assessing Officer can undoubtedly assess or reassess such income, for which there is such reason to believe that income chargeable to tax has escaped assessment. Further, it was held that the second part of the section relates to "any other income" and the question would be as to whether it is to be read in conjunction to the first part or not. It was held that if it is to be read in conjunction, then without there being any addition made with regard to such income for which reason had been given in the notice for reopening assessment, the second part cannot be invoked, but if it is not to be read in conjunction, the second part can be invoked independently even without the reason for the first part to survive. The Court held that the two parts of the section which had been joined with the words "and also", cannot be read as conjunctive but has to be read as disjunctive. 10. The earliest of the decisions on the point is in the case of Jet Airways (I) Ltd. (supra) The Hon'ble Division Bench took note of the decision in Ram Singh (supra) Altas Cycle Industries (supra) held that after the Amendment of 2009, the Assessing Officer must have reason to believe that any income chargeable to tax has escaped assessment for any assessment year; upon the formation of that belief and before he proceeds to make an assessment, reassessment or re-computation, the Assessing Officer has to serve on the assessee a notice under Sub-Section (1) of section 148; the Assessing Officer may assess or reassess such income which he has reason to believe, has escaped assessment and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently, in the course of the proceedings under section 147 and though the notice under section 148 (2) does not include a particular issue with respect to which income has escaped assessment, he may nonetheless assess or reassess the income in respect of any issue which has escaped assessment which has come to his notice subsequently, in the course of the proceedings under the Section. The Hon'ble Division Bench held that even after the Amendment, the Parliament has not taken away the basis of the decision in Ram

Order pronounced on 16.07.2026.

Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 16.07.2026 Sudip Sarkar, Sr.PS Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT DR, ITAT, 4. 5. Guard file. BY ORDER, True Copy//

Asst. Registrar Income Tax Appellate Tribunal, Kolkata