Ganga Saran and Sons P. Ltd. v. ITO

130 ITR 1Supreme Court of India1981#378 most cited

What is Ganga Saran and Sons P. Ltd. v. ITO authority for?

A mere charge of bogus expenses, without a specific finding that the assessee failed to disclose material facts, is insufficient to justify reassessment beyond four years under the first proviso to Section 147. Courts can examine the materiality and relevance of facts forming the 'reason to believe' for initiating reassessment, ensuring it is based on reasonable grounds.

234

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2007 to 2026.

Also referred to as

Ganga Saran and Sons P. Ltd. v. ITO · Section 147 · Section 148 · first proviso to section 147 · reason to believe · income escaping assessment · material facts disclosure · bogus expenses · reassessment beyond four years · judicial review of reasons

Sections most often in play

Section 147Section 148Section 143(3)Section 151Section 139(1)Section 142(1)Section 133ASection 144

Issues it is cited on

true and full disclosurefirst proviso to section 147material facts necessary for assessmentsection 148(2)kelvinatorlive linkmere change of opinionfresh tangible materialsection 151(1)sanctioning authoritybeyond four yearsincome escaping assessment

Judgments citing Ganga Saran and Sons P. Ltd. v. ITO

M/S Grand Slam Pvt. Ltd., New Delhi vs. ITO, New Delhi

In the result, the appeal of the assessee is allowed partly for statistical purpose

ITA 1791/DEL/2013[2003-04]Status: DisposedITAT Delhi09 Jun 2017AY 2003-04

Bench: Sh. I.C. Sudhir & Sh. O.P. Kantassessment Year: 2003-04

Section 131Section 13aSection 143(1)Section 143(2)Section 147Section 148Section 68

…n Mills Ltd. vs. ITO & Ors. 19 (1999) 152 CTR (SC) 418 : (1999) 236 ITR 34 (SC), Praful Chunilal Patel vs. M.J. Makwana, Asstt. CIT (1998) 148 CTR (Guj) 62 : (1999) 236 ITR 832 (Guj); Ganga Saran & Sons (P) Ltd. vs. ITO & Ors. (1981) 22 CTR (SC) 112 : (1981) 130 ITR 1 (SC); Birla VXL Ltd. vs. Asstt. CIT (1996) 130 CTR (Guj) 281 : (1996) 217 ITR 1 (Guj); Sheo Narain Jaiswal & Ors. vs. ITO & Ors. (1989) 176 ITR 352 (Pat); Phool Chand Bajrang Lal & Anr. vs. ITO & Anr. (1993) 113 CTR (SC) 436 : (1993) 203 ITR 456 (SC); Anant Kumar Saharia vs. CIT & Ors. (1999) 151 CTR (Gau) 556 : (1998) 232 ITR 533 (Gau); Bombay Pha…

Lalita Anup Anand, Mumbai vs. ITO WD 21(2)(2), Mumbai

The appeal of the assessee is allowed

ITA 7415/MUM/2016[2012-13]Status: DisposedITAT Mumbai01 May 2017AY 2012-13

Bench: Shri Joginder Singh & Shri Rajendraassessment Year-2012-13 Smt. Lalita Anup Anand, Income Tax Officer 337, Ashish Indl. Estate, Ward-21(2)(2), बनाम/ Gokhale Road, Room No.111, 1St Floor, Vs. Dadar (West), Piramal Chambers, Parel, Mumbai-400028 Mumbai-400012 Pan No.Aadpa1527B (राज"व /Revenue) ("नधा"रती /Assessee)

…lief is founded and not merely a belief in the existence of reasons, inducing the belief. Such a belief may not be based merely on reasons but it must be founded on information. 13. In Ganga Saran & Sons (P) Ltd. vs. ITO & Ors. (1981) 22 CTR (SC) 112 : (1981) 130 ITR 1 (SC), their Lordships of the Supreme Court, inter alia, observed that the expression "reason to believe" is stronger than the expression "is satisfied". The belief entertained by the AO should not be irrational or arbitrary. Alternatively put, it must be reasonable and must be based on reasons which are material. 14. Thus, existence of tangible mat…

Sh. Vikas Kapoor, Delhi vs. ACIT, New Delhi

In the result, the appeal of the Assessee is allowed

ITA 5936/DEL/2016[2008-09]Status: DisposedITAT Delhi28 Mar 2017AY 2008-09

Bench: Shri H.S. Sidhuassessment Year: 2008-09

For Appellant: SH. V.K.SABHARWAL, ADV. &For Respondent: MS. BEDOBINA CHAUDHURI, SR. DR
Section 139(1)Section 142(1)Section 143Section 143(1)Section 143(3)Section 147Section 148

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘SMC’, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER Assessment Year: 2008-09 SH. VIKAS KAPOOR, VS ACIT, FLAT NO. 1, POCKET-A1, CENTRAL CIRCLE-04, SECTOR-07, NEW DELHI ROHINI, DELHI -110 085 C/O SABHARWAL & PARTNERS, 4819/24, ANSARI ROAD, DARYAGANJ, NEW DELHI – 110 002 (PAN: AHRPK4150F) (APPELLANT) (RESPONDENT) Assessee by : SH. V.K.SABHARWAL, ADV. & SH. SUDHIR MATHUR, ADV. Department by : MS. BEDOBINA CHAUDHURI, SR. DR ORDER The Assessee has filed the Appeal against the impugned Order dated 27.9.2016 of Ld. CIT(A)-23, New Delhi pertaining to assess…

Reghuveer Singh Tanwar, Jaipur vs. DCIT, Jaipur

In the result, the appeal of the assessee is allowed for statistical

ITA 357/JPR/2015[2009-10]Status: DisposedITAT Jaipur10 Mar 2017AY 2009-10
For Appellant: Shri Mahendra Gargia (CA)For Respondent: Shri R.A. Verma (Addl. CIT)
Section 143(3)Section 147Section 148Section 234ASection 244ASection 50CSection 54FSection 80C

…l date, are “reason to believe” and not “reason to suspect”. The word “believe” has to be understood in contradistinction of suspicion or opinion. Belief indicates something concrete or reliable. Kindly refer Gangasharan & Sons Pvt. Ltd. v/s ITO & Ors. (1981) 130 ITR 1/22 CTR 112(SC) and ITO v/s Lakhmani Mewal Das (1976) 103 ITR 437 (SC). 1.2. Further, the belief must be of an honest and reasonable person baed upon reasonable grounds. The officer may act on direct or circumstantial evidence, but his/her belief must not be based on mere suspicion, gossip or rumour. The ld. AO would be acting without jurisdiction…

ACIT, Kota vs. Mangalam Cement Ltd., Kota

ITA 82/JPR/2014[2008-09]Status: DisposedITAT Jaipur30 Jan 2017AY 2008-09
For Appellant: Shri P.C. Parwal (CA)For Respondent: Shri H.V. Gurjar (CIT)
Section 143(3)Section 147Section 148Section 32(1)Section 32(1)(i)Section 32(1)(ii)Section 32(1)(iia)Section 43B

…n property. It was held that reopening of assessment is bad in law in as much as AO has ultimately not completed the assessment on the strength of the reasons recorded for reopening the assessment but on altogether different grounds. Hon’ble Supreme Court in 130 ITR 1 held that though Court cannot investigate into the adequacy or sufficiency of the reasons, the Court can certainly examine whether the reasons are relevant and have a bearing on the matters in regard to which he is required to entertain such a belief, before a notice is sought to be issued u/s 148 of the Act. In other words, if there is no rational…

Debottor Trust Estate of Rammohan Mullick, Kolkata vs. ITO, Ward - 43(4), Kolkata

In the result, assessee’s appeal is allowed

ITA 217/KOL/2016[2003-2004]Status: DisposedITAT Kolkata11 Jan 2017AY 2003-2004

Bench: Shri A.T.Varkey & Shri Waseem Ahmed

Section 11Section 12ASection 143(3)Section 147Section 57

…asons on which the belief is founded and not merely a belief in the existence of reasons inducing the belief. Such a belief may not be based merely on reasons but it must be founded on information. As was observed in Ganga Saran and Sons P. Ltd. v. ITO [1981] 130 ITR 1 (SC), the expression "reason to believe" is stronger than the expression "is satisfied". The belief entertained by the Assessing Officer should not be irrational and arbitrary. To put it differently, it must be reasonable and must be based on reasons which are material. In S.Narayanappa v. CIT [1967] 63 ITR 219, it was noted by the apex court that…

M/S. Statcon Power Controls Limited, New Delhi vs. ITO, New Delhi

In the result, appeal of the assessee is allowed

ITA 5953/DEL/2014[2005-06]Status: DisposedITAT Delhi16 Dec 2016AY 2005-06

Bench: Sh. N. K. Sainiita No. 5953/Del/2014 : Asstt. Year : 2005-06 M/S Statcon Power Controls Ltd., Vs Income Tax Officer, 19-E, Pocket-Ii, Kondli Gharoli-Ii, Ward-9(2), Mayur Vihar, Phase-Iii, New Delhi New Delhi-110092 (Appellant) (Respondent) Pan No. Aabcs1814N Assessee By : Sh. Anil Jain, Adv. Revenue By : Sh. F. R. Meena, Sr. Dr Date Of Hearing : 22.09.2016 Date Of Pronouncement : 16.12.2016 Order This Is An Appeal By The Assessee Against The Order Dated 04.09.2014 Of Ld. Cit(A)-Xii, New Delhi. 2. Following Grounds Have Been Raised In This Appeal: “1. The Ld. Cit(A) Has Erred In Confirming The Order Of The Ao In Making The Assessment At The Income Of Rs. 27,05,220 As Against The Returned Income Of Rs, 15,05,220. 2. The Ld Cit(A) Has Erred In Confirming The Order Of The Ld. Ao In Issuing Notice Under Section 148 & Subsequent Proceedings Thereafter Against The Appellant Company. 3. The Ld Cit(A) Has Erred In Confirming The Order Of The Ld. Ao In Treating The Investment By M/S Geecee Finance Limited In Shares Of The Appellant Company As An Accommodation Entry & Consequently Adding It Back To Income Of The Appellant Under Section 68 Of Income Tax Act,1961. 2 Statcon Power Controls Ltd. 4. The Order Of The Cit(A) Is Against Law & Facts Of The Case. 5. The Appellant Craves The Right To Add, Amend Or Withdraw Any Grounds Of Appeal At The Time Of Hearing.” 3. The Main Grievance Of The Assessee In This Appeal Relates To The Reopening The Assessment By Issuing Notice U/S 148 Of The Income Tax Act, 1961 (Hereinafter Referred To As The Act) & Making The Addition Of Rs.12,00,000/- U/S 68 Of The Act.

For Appellant: Sh. Anil Jain, AdvFor Respondent: Sh. F. R. Meena, Sr. DR
Section 143(1)Section 147Section 148Section 68

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘SMC-I’, NEW DELHI Before Sh. N. K. Saini, Accountant Member ITA No. 5953/Del/2014 : Asstt. Year : 2005-06 M/s Statcon Power Controls Ltd., Vs Income Tax Officer, 19-E, Pocket-II, Kondli Gharoli-II, Ward-9(2), Mayur Vihar, Phase-III, New Delhi New Delhi-110092 (APPELLANT) (RESPONDENT) PAN No. AABCS1814N Assessee by : Sh. Anil Jain, Adv. Revenue by : Sh. F. R. Meena, Sr. DR Date of Hearing : 22.09.2016 Date of Pronouncement : 16.12.2016 ORDER This is an appeal by the assessee against the order dated 04.09.2014 of ld. CIT(A)-XII, New Delhi. 2. Following grounds ha…

DCIT, New Delhi vs. M/S. Dharampal Satyapal Ltd., Delhi

In the result, the appeal of the assessee is allowed and the appeal of the revenue is dismissed

ITA 5611/DEL/2013[2004-05]Status: DisposedITAT Delhi08 Jan 2016AY 2004-05

Bench: Shri A.T. Varkey & Shri Prashant Maharishi

For Appellant: Shri R.S. Singhvi, CA and Shri Satyajeet Goel, CAFor Respondent: Ms. Nandita Kanchan, CIT DR
Section 115JSection 132Section 143(3)Section 14ASection 264Section 80I

…asons on which the belief is founded and not merely a belief in the existence of reasons inducing the belief. Such a belief may not be based merely on reasons but it must be founded on information. As was observed in Ganga Saran and Sons P. Ltd. v. ITO [1981] 130 ITR 1 (SC), the expression "reason to believe" is stronger than the expression "is satisfied". The belief entertained by the Assessing Officer should not be irrational and arbitrary. To put it differently, it must be reasonable and must be based on reasons which are material. In S.Narayanappa v. CIT [1967] 63 ITR 219, it was noted by the apex court that…

M/S. Dharampal Satyapal Ltd., New Delhi vs. DCIT, New Delhi

In the result, the appeal of the assessee is allowed and the appeal of the revenue is dismissed

ITA 5581/DEL/2013[2004-05]Status: DisposedITAT Delhi08 Jan 2016AY 2004-05

Bench: Shri A.T. Varkey & Shri Prashant Maharishi

For Appellant: Shri R.S. Singhvi, CA and Shri Satyajeet Goel, CAFor Respondent: Ms. Nandita Kanchan, CIT DR
Section 115JSection 132Section 143(3)Section 14ASection 264Section 80I

…asons on which the belief is founded and not merely a belief in the existence of reasons inducing the belief. Such a belief may not be based merely on reasons but it must be founded on information. As was observed in Ganga Saran and Sons P. Ltd. v. ITO [1981] 130 ITR 1 (SC), the expression "reason to believe" is stronger than the expression "is satisfied". The belief entertained by the Assessing Officer should not be irrational and arbitrary. To put it differently, it must be reasonable and must be based on reasons which are material. In S.Narayanappa v. CIT [1967] 63 ITR 219, it was noted by the apex court that…

M/S Veena Enterprises Ltd., New Delhi vs. ACIT, New Delhi

In the result appeal of the assessee is allowed

ITA 2517/DEL/2013[2004-05]Status: DisposedITAT Delhi09 Oct 2015AY 2004-05

Bench: Sh. N. K. Saini, Am & Sh. H. S. Sidhu, Jm Ita No. 2517/Del/2013 : Asstt. Year : 2004-05 M/S Veena Enterprises Ltd., Vs Assistant Commissioner Of 81, Vigyan Vihar, Income Tax, Circle 17(1), New Delhi-110092 New Delhi (Appellant) (Respondent) Pan No. Aaacv3918K Assessee By : Sh. Ajay Vohra, Sr. Adv. Sh. Rohit Garg, Fca Sh. Deepesh Jain, Ca & Sh. Udit Naresh, Adv. Revenue By: Sh. J. P. Chandrakar, Sr. Dr Date Of Hearing : 15.07.2015 Date Of Pronouncement : 09.10.2015 Order Per N.K. Saini, A.M. This Is An Appeal By The Assessee Against The Order Dated 22.01.2013 Of The Ld. Cit(A)-19, New Delhi.

For Appellant: Sh. Ajay Vohra, Sr. Adv. Sh. Rohit Garg, FCAFor Respondent: Sh. J. P. Chandrakar, Sr. DR
Section 147Section 148

…IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘H’, NEW DELHI Before Sh. N. K. Saini, AM And Sh. H. S. Sidhu, JM ITA No. 2517/Del/2013 : Asstt. Year : 2004-05 M/s Veena Enterprises Ltd., Vs Assistant Commissioner of 81, Vigyan Vihar, Income Tax, Circle 17(1), New Delhi-110092 New Delhi (APPELLANT) (RESPONDENT) PAN No. AAACV3918K Assessee by : Sh. Ajay Vohra, Sr. Adv. Sh. Rohit Garg, FCA Sh. Deepesh Jain, CA & Sh. Udit Naresh, Adv. Revenue by: Sh. J. P. Chandrakar, Sr. DR Date of Hearing : 15.07.2015 Date of Pronouncement : 09.10.2015 ORDER PER N.K. SAINI, A.M. This is an appeal by the Assessee against the or…

Sri C M Mahadeva S/O Sri Manche Gowda vs. The Commissioner of Income Tax

The appeal stands allowed

ITA/795/2009HC Karnataka24 Aug 2015

Bench: B.MANOHAR,VINEET SARAN

Section 139Section 143(1)Section 147Section 148Section 255(6)Section 260Section 69

…cer had formed his opinion that he had ‘reason to believe’ that any such income had escaped 19 assessment. The same is totally lacking in the present case. 21. The Apex Court in the case of Ganga Saran and Sons P. Ltd. –vs- ITO (1981) 130 ITR 1 has interpreted the scope of Section 147 of the Act for the purpose of reopening of assessment. The relevant paragraph of the aforesaid judgment of the Supreme Court is reproduced below: “It is well settled as a result of several decisions of this court that two distinct conditions must be satisfied before the Income Tax Officer can assu…

Shri S L Basavaraj (HUF) vs. The Asst Commissioner of Income Tax

Appeals stand allowed

ITA/336/2009HC Karnataka07 Aug 2015

Bench: The Tribunal. By A Common Order Dated 30.1.2009, Tribunal Has Allowed The Appeals Of The Revenue. Aggrieved

Section 143(1)Section 148Section 260

…ch he is to form regarding the escapement of the income of the assessee from assessment because of the latter’s failure or omission to disclose fully and truly all material facts. In the case of Ganga Saran & Sons P. Ltd. –vs- Income-tax Officer ((1981) 130 ITR 1, the Apex Court, while considering a case under the unamended Act, has held that “the Court, of course, cannot investigate into the adequacy or sufficiency of 11 the reasons which have weighed with the ITO in coming to the belief, but the Court can certainly examine whether the reasons are relevant and have a bearing on the matters…

The Commissioner of Income Tax-IV vs. Moschip Semiconductor Technology Ltd

The appeal stands dismissed

ITTA/163/2012HC Telangana26 Nov 2012

Bench: GODA RAGHURAM,M.S.RAMACHANDRA RAO

Section 11Section 12Section 12ASection 13(1)(b)

…HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 163 / 2012 COMMISSIONER OF INCOME TAX, JAIPUR-II ,JAIPUR ----Appellant Versus BHAGWAN MAHAVEER PURSHARTH PRENA NIDHI NYAS, SHRI DIGAMBER JAIN MANDIR PASRAVNATH MARG, SECTOR-7, JAWAHAR NAGAR, JAIPUR ----Respondent _____________________________________________________ For Appellant(s) : Mr. K.D. Mathur for Mr. R.B. Mathur For Respondent(s) : Mr. Siddharth Ranka _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE MR. JUSTICE INDERJEET SINGH Order 11/09/2017 1…

The Commissioner of Income Tax vs. Atul Jain

The appeals are dismissed

ITA/1384/2006HC Delhi23 May 2007

Bench: HON'BLE MR. JUSTICE VIKRAMAJIT SEN

Section 148

…re are no reasons, then the entire foundation for initiating the proceedings is bad and the notice initiating proceedings must be quashed. 14. At this stage, it is worth recalling that in Ganga Saran & Sons Pvt. Ltd. v. Income-tax Officer & Others, (1981) 130 ITR 1, the Supreme Court noted that the expression “reason to believe” as occurring in Section 147 of the Act is stronger than the expression “is satisfied”. In other words, mere satisfaction of the Assessing Officer for the issuance of a notice is not enough – there must be reasons on record which have led him to believe that a notice sho…