“reason to believe”

ReassessmentSection 147Section 1474,202 judgments

The decision most relied on for reason to believe is CIT v. Kelvinator of India Ltd. (320 ITR 561), cited in 1,673 judgments on BharatTax.

Leading authorities on reason to believe

CIT v. Kelvinator of India Ltd.

320 ITR 561 · 2010 · Supreme Court

1,673

citing judgments

An Assessing Officer cannot initiate reassessment proceedings under Section 147 of the Income Tax Act based on a mere change of opinion. Reassessment is permissible only when there is fresh tangible material leading to the belief of income escapement, not merely a review of existing facts.

CIT v. Durga Prasad More

82 ITR 540 · 1971 · Supreme Court

1,579

citing judgments

Tax authorities must judge evidence using the test of human probabilities and consider the apparent as real until there are reasons to believe it is not. They can rely on circumstantial evidence and the preponderance of probabilities to determine the genuineness of transactions.

ACIT v. Rajesh Jhaveri Stock Brokers Pvt. Ltd.

291 ITR 500 · 2007 · Supreme Court

1,030

citing judgments

For initiating reassessment proceedings under Section 147, the Assessing Officer needs only prima facie material providing a reason to believe that income has escaped assessment. Conclusive proof or the sufficiency/correctness of the material is not required at the stage of issuing the notice under Section 148.

Raymond Woollen Mills Ltd. v. ITO

236 ITR 34 · 1999 · Supreme Court

862

citing judgments

For reassessment proceedings under Section 148, the Assessing Officer only needs prima facie material to have a reason to believe income has escaped assessment. Conclusive proof or evaluation of the sufficiency and correctness of such material is not required at the stage of issuing the notice.

ITO v. Lakhmani Mewal Das

103 ITR 437 · 1976 · Supreme Court

721

citing judgments

For reassessment proceedings, the 'reason to believe' that income has escaped assessment must be based on some material and not mere suspicion, establishing a live link between the information and the belief. Furthermore, for reassessment beyond four years, there must be a specific finding of the assessee's failure to disclose fully and truly all material facts.

CIT v. Jet Airways (I) Ltd.

331 ITR 236 · 2011 · High Court

694

citing judgments

The Assessing Officer loses jurisdiction and the entire reassessment becomes invalid if no addition is made in respect of the income that formed the basis of the reopening. Explanation 3 to Section 147 does not permit assessing other escaped income unless an addition is made for the original income forming the reason to believe.

PCIT v. Meenakshi Overseas Pvt. Ltd.

395 ITR 677 · 2017 · High Court

471

citing judgments

Reassessment proceedings initiated solely based on an investigation wing/appraisal report, without the Assessing Officer's independent application of mind to form a 'reason to believe' that income has escaped assessment, are beyond jurisdiction, bad in law, and void ab initio.

CIT v. Kelvinator of India Ltd.

256 ITR 1 · 2002 · High Court

439

citing judgments

An Assessing Officer cannot reopen an assessment under Section 147 based on a mere change of opinion regarding the same material available during the original assessment. Reopening requires fresh, tangible material or information that leads to a reason to believe income has escaped assessment.

Judgments citing reason to believe

Jayesh Hirji Savla, Mumbai vs. Asst. Commissioner of Income-Tax Central Circle -5(1), Mumbai

ITA 3243/MUM/2024[2016-2017]Status: DisposedITAT Mumbai23 Aug 2024AY 2016-2017

Bench: Shri Pavan Kumar Gadale & Smt Renu Jauhri

Section 142(1)Section 144Section 147

IN THE INCOME TAX APPELLATE TRIBUNAL “F” BENCH MUMBAI BEFORE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER & SMT RENU JAUHRI, ACCOUNTANT

Jayesh Hirji Savla, Mumbai vs. Asst. Commissioner of Income-Tax Central Circle -5(1), Mumbai

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 3242/MUM/2024[2017-2018]Status: DisposedITAT Mumbai23 Aug 2024AY 2017-2018

Bench: Shri Pavan Kumar Gadale & Smt Renu Jauhri

Section 142(1)Section 144Section 147

received the information that the assessee has made high value deposits in the bank accounts and were not explained, therefore the AO has reason to believe that the income has escaped assessment and issued notice u/sec 148 of the Act and in compliance, the assesse has filed the return

Mansukh Arjanbhai Sureja, Mumbai vs. DCIT, Circle 42(1)(1), Mumbai

ITA 4348/MUM/2023[2011-12]Status: DisposedITAT Mumbai23 Aug 2024AY 2011-12

Bench: Shri Narendra Kumar Billaiya, Hon'Ble & Shri Sandeep Singh Karhail, Hon'Bleι.Τ.Α. No. 4348 & 4347/Mum/2023

For Appellant: Shri Hariom Tulsiyan, A/RFor Respondent: Smt. Sanyogita Nagpal & Smt. Mahita Nair, Sr. D/R

Section 69C

relevant year has expired in this case the requirements to initiate proceedings u/s 147 of the IT Act are reasons to believe that income for the year under consideration has escaped assessment because of failure on the part of the assessee to disclose fully and truly all material facts necessary ... assessment for the year under consideration. It is pertinent to mention here that reasons to believe that income has escaped assessment for the year under consideration have been recorded in paragraph 2 above. 4. In this case more than four years have lapsed from the end of assessment year under

Mansukh Arjanbhai Sureja, Mumbai vs. DCIT, Circle 42(1)(1), Mumbai

In the result, appeals of the assessee are allowed

ITA 4347/MUM/2023[2012-13]Status: DisposedITAT Mumbai23 Aug 2024AY 2012-13

Bench: Shri Narendra Kumar Billaiya, Hon’Ble & Shri Sandeep Singh Karhail, Hon’Ble

For Appellant: Shri Hariom Tulsiyan, A/RFor Respondent: Smt. Sanyogita Nagpal & Smt. Mahita Nair, Sr. D/R

Section 69C

Dipak Balubhai Patel - HUF, Ahmedabad vs. The Income Tax Officer, Ward-5(3)(1), Ahmedabad

In the result, the appeal filed by the Assessee is allowed

ITA 942/AHD/2023[2017-18]Status: DisposedITAT Ahmedabad22 Aug 2024AY 2017-18

Bench: Smt. Annapurna Gupta (Accountant Member), Shri T.R. Senthil Kumar (Judicial Member)

Section 115BSection 143(3)Section 69A

expenses. Even though the appellant claims that day to day expenses are met from business income, there is no reason to believe that an individual who frequents bank, preserve all these drawings with himself for 3 years. If the appellant had so much of cash with him then what

Anchita Properties Pvt. Ltd., Kolkata vs. ITO, Ward-12(1), Kolkata.

In the result, both the appeals of the assessee are allowed

ITA 637/KOL/2024[2013-14]Status: DisposedITAT Kolkata22 Aug 2024AY 2013-14

Bench: Shri Rajpal Yadav, Vice-(Kz) & Dr. Manish Boradi.T.A. No. 637/Kol/2024 Assessment Year: 2013-2014 Anchita Properties Pvt. Limited,………………Appellant 29, Collotola Street, Kolkata-700029 [Pan:Aahca9115E] -Vs.- Income Tax Officer,………………………….……Respondent Ward-12(1), Kolkata, Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700069 & I.T.A. No. 1067/Kol/2024 Assessment Year: 2013-2014 Anchita Properties Pvt. Limited,………………Appellant 29, Collotola Street, Kolkata-700029 [Pan:Aahca9115E] -Vs.- Principal Commissioner Of Income Tax,…Respondent Pcit, Kolkata-2, Office Of The Income Tax Officer, Ward-12(1), Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700069

Section 133(6)Section 139(1)Section 143(2)Section 143(3)Section 147Section 148Section 250Section 263Section 68

paper/shell companies controlled by entry operator, Shri Pankaj Agarwal. As such the transaction is remained unverified. In view of the above I have reason to believe that the assessee company, M/s. ANCHITA PROPERTIES PVT. LTD, has brought back its own unaccounted money of Rs. 1,45,00,000/- & Rs.10 ... above dubious entities in the financial year 2012-13 relevant to assessment year 2013-14. In view of the above, I have reason to believe that income chargeable to tax has escaped assessment coming within the meaning of section 147 read with proviso thereto, by reason of failure

Anchita Properties Pvt. Ltd., Kolkata vs. P.C.I.T., Kolkata - 2, Kolkata

In the result, both the appeals of the assessee are allowed

ITA 1067/KOL/2024[2013-2014]Status: DisposedITAT Kolkata22 Aug 2024AY 2013-2014

Section 133(6)Section 139(1)Section 143(2)Section 143(3)Section 147Section 148Section 250Section 263Section 68

Thayappa Balakrishna, Bangalore vs. The Principal Commissioner of Income Tax, Bengaluru-1, Bengaluru

In the result, the appeal filed by the assessee stands allowed

ITA 1027/BANG/2024[2014-15]Status: DisposedITAT Bangalore22 Aug 2024AY 2014-15

Bench: Smt. Beena Pillai & Shri Laxmi Prasad Sahuassessment Year : 2014-15 Shri Thayappa Balakrishna, No. 987, 11Th Main, The Principal 1St Block, Commissioner Of 3Rd Stage, Income-Tax, Basaveshwaranagar, Bengaluru – 1. Vs. Bangalore – 560 079. Pan: Abdpb4893N Appellant Respondent : Shri Ravi Shankar .S.V, Assessee By Advocate Revenue By : Shri D.K. Mishra, Cit-Dr

For Respondent: Shri Ravi Shankar .S.V

Section 143(3)Section 147Section 148Section 263

notice under section 148(2), when proceedings were initiated by the Assessing Officer on issues in respect of which he had formed a reason to believe that income had escaped assessment, Page 15 of 24 it was not open to the Assessing Officer to carry out an assessment, or reassessment ... Division Bench held that in respect of an issue which is totally unconnected to the basis on which the Assessing Officer formed a reason to believe that income escaped assessment and issued a notice under section 148, it was open to him to issue a fresh notice by following

Ecgc Limited, Mumbai vs. ACIT 3(1)(2), Mumbai

In the result, appeal of the assessee is allowed

ITA 352/MUM/2024[2012-13]Status: DisposedITAT Mumbai22 Aug 2024AY 2012-13

Bench: SHRI AMIT SHUKLA (Judicial Member), SHRI RATNESH NANDAN SAHAY (Accountant Member)

Section 115JSection 143(3)Section 147Section 148

escaped assessment and consequently short levy of tax of Rs. 76,40,798/-, Therefore, I have reasons to believe that income amounting to Rs. 2,35,50,000/- has escaped assessment. 3. In this case a return of income was filed for the year under consideration and regular assessment ... from the end of the relevant year has expired in this case, the requirements to initiate proceeding u/s 147 of the Act are reason to believe that income for the year under consideration has escaped assessment because of failure on the part of the assessee to disclose fully and truly

Vinod Mohanan, Navi Mumbai vs. NFAC, National Faceless Assessment Centre

In the result, appeal is allowed

ITA 3390/MUM/2024[2013-14]Status: DisposedITAT Mumbai22 Aug 2024AY 2013-14

Bench: Shri Pavan Kumar Gadale, Judicialmember & Smt. Renu Jauhrivinod Mohanan, Vs. Nfac, B/202, Plot No. 5, Anurag Income Tax Residency, Sector-9, Department, Opp Saksham Surer Mkt. Newdelhi-110001. Kamothe, Thane– 410208. Maharastra Pan/Gir No. Axgpm7296M (अपीलाथ"/Appellant) (""यथ"/Respondent) Assesseeby Shri Suresh Gudhar & Shri Rajesh B Jage.Ar Revenue By Shri Krishna Kumar.Sr.Dr सुनवाई क" तार"ख/Date Of Hearing 19.08.2024 घोषणा क" तार"ख/Date Of Pronouncement 22.08.2024 Order Per Pavan Kumar Gadale, Jm:

Section 271(1)(c)

192A & u/sec 192B of the Act amounting to Rs. 3,12,020 & Rs.1,97,511/- in the F.Y 2012-13. The AO has reason to believe that the income has escaped assessment and issued notice u/sec148 of the Act. Incompliance to notice the assessee has submitted the details and subsequently

Lizard Trading Pvt. Ltd., Kolkata vs. Income Tax Officer, Ward-4, Mumbai

In the result, both the appeals filed by the assessee are allowed for statistical purposes

ITA 178/RPR/2022[2010-11]Status: DisposedITAT Mumbai22 Aug 2024AY 2010-11

Bench: Shri Br Baskaran & Shri Pavan Kumar Gadale

Section 144Section 148Section 68

facts and circumstances of the case, the Ld. AO erred in issuing notice u/s 148 without necessary approval and without providing reasons to believe. 8. That in the facts and circumstances of the case, the Ld. AO erred in making vague assessment order without quoting specific section under which ... Purohit group, who are engaged in providing the accommodation entries to various persons and the assessee is a beneficiary. Therefore the AO has reason to believe that the income has escaped assessment and issued notice u/sec 148 of the Act and incompliance the assesse has filed the return of income

Shailesh Subodhchandra Jhaveri, Ahmedabad vs. The Dy.CIT, Central Circle-1(1), Ahmedabad

In the result, the appeal of the assessee is dismissed for both the year under consideration

ITA 16/AHD/2024[2012-13]Status: DisposedITAT Ahmedabad21 Aug 2024AY 2012-13

Bench: Shri Siddhartha Nautiyal & Shri Makarand V. Mahadeokar

For Appellant: Shri Deeapk Shah, A.RFor Respondent: Shri Ashok Kumar Suthar, Sr. DR

taken a specific note of the systematic operation is being conducted by SCS, to provide bogus accommodation losses to various clients. In the “Reason to Believe” dated 11.05.2015, the assessing officer observed that on April 9, 2013, a search and survey action was conducted at the residence and offices ... escaped assessment due to the assessee's failure to disclose all necessary facts. The relevant extracts of the “Reason to Believe” is reproduced for ready reference: “Reasons for reopening the Assessment Shailesh S Jhaveri (ADTPJ0210B) - A.Y. 2011-12 A search and survey action was carried out at the residence

Shailesh S. Jhaveri, Ahmedabad vs. The Dy.CIT, Cent. Circle-1(1), Ahmedabad

In the result, the appeal of the assessee is dismissed for both the year under consideration

ITA 15/AHD/2024[2012-13]Status: DisposedITAT Ahmedabad21 Aug 2024AY 2012-13

Bench: Shri Siddhartha Nautiyal & Shri Makarand V. Mahadeokar

For Appellant: Shri Deeapk Shah, A.RFor Respondent: Shri Ashok Kumar Suthar, Sr. DR

Shailesh Subodhchandra Jhaveri, Ahmedabad vs. The Dy.CIT, Central Circle-1(1), Ahmedabad

In the result, the appeal of the assessee is dismissed for both the year under consideration

ITA 14/AHD/2024[2011-12]Status: DisposedITAT Ahmedabad21 Aug 2024AY 2011-12

Bench: Shri Siddhartha Nautiyal & Shri Makarand V. Mahadeokar

For Appellant: Shri Deeapk Shah, A.RFor Respondent: Shri Ashok Kumar Suthar, Sr. DR

Seema Ramesh Gianchandani C/O. Deepak Moorjani, Chennai vs. ITO, International Taxation Ward 1(1), Chennai

In the result, appeal filed by the assessee is allowed

ITA 896/CHNY/2024[2015-16]Status: DisposedITAT Chennai21 Aug 2024AY 2015-16

Bench: Shri Aby T. Varkey & Shri Jagadishआयकर अपील सं./Ita No.896/Chny/2024 िनधा"रणवष"/Assessment Year: 2015-16 V. Shri Seema Ramesh Gianchandani, The Ito, C/O. Deepak Moorjani, International Taxation Ward- No.9, Agastya Nagar, 1(1), Kilpauk, Chennai-600 010. Chennai. [Pan: Bozpg 1404 A] (अपीलाथ"/Appellant) (""यथ"/Respondent)

Section 148Section 50C(1)Section 55A

that section provided that where a person acquired a capital asset from an assessee connected with him and the Income-Tax Officer had reason to believe that the transfer was effected with a view to avoid or reduce the liability of the assessee under Section

Netherlands Operating Company B.V., Chennai vs. The Assistant Commissioner of Income Tax, Int. Taxation 2(1), Chennai

In the result, appeal filed by the assessee is allowed

ITA 1198/CHNY/2023[2010-11]Status: DisposedITAT Chennai21 Aug 2024AY 2010-11

Bench: Shri Aby T. Varkey & Shri Jagadishआयकर अपील सं./Ita No.1198/Chny/2023 िनधा"रणवष"/Assessment Year: 2010-11 V. Netherlands Operating Company B.V. The Acit, Rmz Millenia (Phase-1), International Taxation -2(1), Business Park, 4Th Floor, Campus 1C, Chennai. 11, Dr. M.G.R. Road, Kandanchavadi, Perungudi, Chennai-600 096. [Pan: Aabcl 0573 D] (अपीलाथ"/Appellant) (""यथ"/Respondent)

For Appellant: Shri Vishal Kalra, Adv. &For Respondent: Shri R. Clement Ramesh –

Section 143Section 143(2)Section 143(3)Section 144C(1)Section 144C(3)(b)Section 147Section 148

manner, the same purpose has been served already under the provisions of section 147 of the Act as a reason to believe with regard to the understatement of income was already present. (vii) The history of evolution of the provisions of section 143 clearly reveals that the purpose of section ... Court held as under: "Section 147 authorises and permits the Assessing Officer to assess or reassess income chargeable to tax if he has reason to believe that income for any assessment year has escaped assessment. The word reason in the phrase ‘reason to believe’ would mean cause or justification

Asstt Commissioner of Income Tax-4 (2) (1), Mumbai vs. S P Jain Securities Pvt Ltd, Fort

In the result, the appeal by the Revenue is dismissed

ITA 606/MUM/2024[2011-12]Status: DisposedITAT Mumbai21 Aug 2024AY 2011-12

Bench: Shri B.R. Baskaran & Shri Sandeep Singh Karhail

For Appellant: Shri Bhavya SundeshaFor Respondent: Shri Surendra Meena, Sr. DR

Section 10(38)Section 143(1)Section 143(3)Section 147Section 148Section 14ASection 250Section 68

after due application of mind after analyzing all the relevant information in the case of the assessee in totality, I have reason to believe that income of Rs. 12,75,483/- has escaped assessment for AY 2011-12 and the same is therefore required to be reopened for scrutiny assessment

L.K. Exports, Mumbai vs. ITO Mum-W-(199)(91), Ward 23(2)(1), Mumbai

ITA 3582/MUM/2024[2013-14]Status: DisposedITAT Mumbai21 Aug 2024AY 2013-14

Bench: Justice (Retd.) C.V. Bhadang & Shri B.R. Baskaran: A.Y : 2013-14

For Appellant: Shri Rajesh C. ShahFor Respondent: Shri Manoj Kumar Sinha

Section 143(1)Section 143(3)Section 144BSection 147Section 148Section 151

regulated by the statutory provisions. The necessary condition precedent about satisfaction of the Assessing Officer and requirement of Assessing Officer having reason to believe that a certain income has escaped assessment is the sine qua non for sustaining any re-opening, which powers cannot be relegated or abdicated

Mr. Ramprakash Mathuradas Dhingra, Mumbai vs. ITO, Ward 2(3), Kalyan

In the result, the appeals of the assessee for AY 2010-11 and AY 2011-12

ITA 4303/MUM/2023[2011-12]Status: DisposedITAT Mumbai21 Aug 2024AY 2011-12

Bench: Ms Padmavathy S, Am & Shri Rahul Chaudhary, Jm

For Appellant: Shri Joginder Singh, Sr. DR

Section 147Section 148Section 2(14)Section 251Section 68Section 69A

look at the provisions of section 147 of the Act. Income escaping assessment. 5 147. If the 6[Assessing] Officer 7[has reason to believe 8] that any income chargeable to tax has escaped assessment 8 for any assessment year, he may, subject to the provisions of sections ... that assessment year: **** 6. Though section 147 of the Act authorizes an assessing officer to reassess income chargeable to tax if he has reason to believe that the income for any assessment year has escaped assessment, the proviso to the aforesaid section, curtails the powers to initiate reassessment proceedings beyond

Mr. Ramprakash Mathuradas Dhingra, Mumbai vs. ITO Ward 2(3), Kalyan

In the result, the appeals of the assessee for AY 2010-11 and AY 2011-12

ITA 4302/MUM/2023[2010-11]Status: DisposedITAT Mumbai21 Aug 2024AY 2010-11

Bench: Ms Padmavathy S, Am & Shri Rahul Chaudhary, Jm

For Appellant: Shri Joginder Singh, Sr. DR

Section 147Section 148Section 2(14)Section 251Section 68Section 69A