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“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

ITO 23(1)(6), Mumbai vs. Holiday Resort Corporation, Mumbai

In the result, Cross Objections under consideration filed by the Assessee are allowed and the appeals filed by the Revenue are dismissed being infructuous

ITA 2199/MUM/2023[2007-2008]Status: DisposedITAT Mumbai30 Jan 2024AY 2007-2008

Bench: Shri.Narender Kumar Choudhry () & Shri S Rifaur Rahman ()

For Appellant: Shri. Piyush Chajjed
Section 148Section 151Section 151(1)Section 250

year of sale and no such income is offered for tax by the assessee. In view of the above facts 1 have reason to believe that the income of more than Rs.1,00,000/- has escaped assessment in the case of the assessee and accordingly Notice

ITO 23(1)(6), Mumbai vs. Holiday Resort Corporation, Mumbai

In the result, Cross Objections under consideration filed by the Assessee are allowed and the appeals filed by the Revenue are dismissed being infructuous

ITA 2198/MUM/2023[2009-10]Status: DisposedITAT Mumbai30 Jan 2024AY 2009-10

Bench: Shri.Narender Kumar Choudhry () & Shri S Rifaur Rahman ()

For Appellant: Shri. Piyush Chajjed
Section 148Section 151Section 151(1)Section 250

year of sale and no such income is offered for tax by the assessee. In view of the above facts 1 have reason to believe that the income of more than Rs.1,00,000/- has escaped assessment in the case of the assessee and accordingly Notice

ITO Ward - 4, Rohtak vs. Surender Dalal, Rohtak

In the result, appeal of the Assessee is partly allowed as

ITA 7714/DEL/2019[2009-10]Status: DisposedITAT Delhi30 Jan 2024AY 2009-10

Bench: Shri G.S. Pannu, Hon’Ble & Shri Challa Nagendra Prasadआ.अ.सं/.I.T.A No.7714/Del/2019 िनधा"रणवष"/Assessment Year: 2009-10 बनाम Ito, Surender Dalal, Ward-4, Vs. Dalal Bhawan, Aayakar Bhawan, Rohtak, Haryana Near Petrol Pump, Gohana Road, Rohtak, Haryana. Pan No.Aqlps2166C अपीलाथ" Appellant ""यथ"/Respondent & आ.अ.सं/.I.T.A No.7490/Del/2019 िनधा"रणवष"/Assessment Year: 2009-10 बनाम Surender Dalal, Ito, Dalal Bhawan, Vs. Ward-4, Near Petrol Pump, Aayakar Bhawan, Gohana Road, Rohtak, Haryana Rohtak, Haryana. Pan No.Aqlps2166C अपीलाथ" Appellant ""यथ"/Respondent

Section 147Section 148Section 151Section 69

house property. Secondly, the assessee has not filed return of income for the AY 2009-10 based on these reasons the AO has reason to believe that the income more than 15 I.T.A.Nos.7714 & 7490/Del/2019 crores which is chargeable to tax has escaped assessment ... property at Rs.58,93,050/-. All these goes to show that absolutely there is no application of mind by the AO before recording reasons to believe that the income of the assessee had escaped assessment more than 15 crores for the assessment year under consideration. 10. The Hon’ble Delhi

Surender Dalal, Rohtak vs. ITO Ward - 4, Rohtak

In the result, appeal of the Assessee is partly allowed as

ITA 7490/DEL/2019[2009-10]Status: DisposedITAT Delhi30 Jan 2024AY 2009-10

Bench: Shri G.S. Pannu, Hon’Ble & Shri Challa Nagendra Prasadआ.अ.सं/.I.T.A No.7714/Del/2019 िनधा"रणवष"/Assessment Year: 2009-10 बनाम Ito, Surender Dalal, Ward-4, Vs. Dalal Bhawan, Aayakar Bhawan, Rohtak, Haryana Near Petrol Pump, Gohana Road, Rohtak, Haryana. Pan No.Aqlps2166C अपीलाथ" Appellant ""यथ"/Respondent & आ.अ.सं/.I.T.A No.7490/Del/2019 िनधा"रणवष"/Assessment Year: 2009-10 बनाम Surender Dalal, Ito, Dalal Bhawan, Vs. Ward-4, Near Petrol Pump, Aayakar Bhawan, Gohana Road, Rohtak, Haryana Rohtak, Haryana. Pan No.Aqlps2166C अपीलाथ" Appellant ""यथ"/Respondent

Section 147Section 148Section 151Section 69

house property. Secondly, the assessee has not filed return of income for the AY 2009-10 based on these reasons the AO has reason to believe that the income more than 15 I.T.A.Nos.7714 & 7490/Del/2019 crores which is chargeable to tax has escaped assessment ... property at Rs.58,93,050/-. All these goes to show that absolutely there is no application of mind by the AO before recording reasons to believe that the income of the assessee had escaped assessment more than 15 crores for the assessment year under consideration. 10. The Hon’ble Delhi

DCIT, Central Circle-29, New Delhi vs. Rita Chandiok, New Delhi

ITA 2435/DEL/2022[2011-12]Status: DisposedITAT Delhi29 Jan 2024AY 2011-12

Bench: Shri G.S. Pannu, Hon’Ble & Shri Anubhav Sharma

For Appellant: Shri Vinod Bindal, CA &For Respondent: Shri Vivek Vardhan, Sr. DR
Section 133(6)Section 142(1)Section 143(1)Section 143(2)Section 54

said transfer has to be taxed in the Assessment Order 2011-12 itself and that there was no way for him to form reason to believe that the such capital gain had escaped assessment for any other Assessment Year. Accordingly, he had concluded that the order dated 08.02.2018 giving effect

DCIT, Central Circle-29, New Delhi vs. Rita Chandiok, New Delhi

ITA 2434/DEL/2022[2011-12]Status: DisposedITAT Delhi29 Jan 2024AY 2011-12

Bench: Shri G.S. Pannu, Hon’Ble & Shri Anubhav Sharma

For Appellant: Shri Vinod Bindal, CA &For Respondent: Shri Vivek Vardhan, Sr. DR
Section 133(6)Section 142(1)Section 143(1)Section 143(2)Section 54

said transfer has to be taxed in the Assessment Order 2011-12 itself and that there was no way for him to form reason to believe that the such capital gain had escaped assessment for any other Assessment Year. Accordingly, he had concluded that the order dated 08.02.2018 giving effect

Ashokkumar Manmal Bhansalihvi, Ahmedabad vs. Assistant Commissioner of Income Tax, Circle 3(2), Ahmedabad

In the result, the appeal of the assessee is allowed in above terms

ITA 709/AHD/2023[2011-12]Status: DisposedITAT Ahmedabad24 Jan 2024AY 2011-12

Bench: Smt.Annapurna Guptaasstt.Year :2011-12 Ashokkumar Manmal Bhanasali Acit, Cir.3(2) 508-B, Gidc Indl Estate Vs Ahmedabad. Mehmadabad Road Vatva, Ahmedabad. Pan : Abxpb 1343 H

For Appellant: Shri Kishan Mehta, AR
Section 147Section 250(6)

same is figured out in ground no.3 which reads as under: 2 “That on facts and in law the AO has no reason to believe that income chargeable to tax has escaped assessment u/s.147 of the IT Act and therefore assuming of jurisdiction and issuance of notice

ACIT, CC-2(1), Kol, Kolkata vs. Shalimar Hatcheries Limited, Kolkata

In the result, the appeal of the Revenue is allowed and the Cross Objection filed by the assessee is dismissed

ITA 546/KOL/2023[2012-13]Status: DisposedITAT Kolkata24 Jan 2024AY 2012-13

Bench: Shri Rajpal Yadav, Vice-(Kz) & Shri Girish Agrawali.T.A. No. 546/Kol/2023) Assessment Year: 2012-2013 Assistant Commissioner Of Income Tax,....Appellant Central Circle-2(1), Kolkata, Aayakar Bhawan Poorva, 3Rd Floor, 110, Shanti Pally, Kolkata-700107 -Vs.- Shalimar Hatcheries Ltd.,......................Respondent 46C, Chowringhee Road, Park Street, 17Th Floor, Everest House, Kolkata-700071 [Pan: Aadcs6537J] - A N D - C.O. No. 13/Kol/2023 (In I.T.A. No. 546/Kol/2023) Assessment Year: 2012-2013 Shalimar Hatcheries Ltd.,..................Cross Objector 46C, Chowringhee Road, Park Street, Kolkata-700071 [Pan: Aadcs6537J] -Vs.- Assistant Commissioner Of Income Tax,....Respondent Central Circle-2(1), Kolkata, Aayakar Bhawan Poorva, 110, Shanti Pally, Kolkata-700107 Appearances By: Shri P.P. Barman, Addl. Cit, Appeared On Behalf Of The Revenue

Section 132Section 139Section 143(2)Section 143(3)Section 147Section 148Section 153ASection 35(1)(ii)

that the proceedings u/s147 in this case , has been initiated against the provisions of the Income Tax Act and is initiated without proper “reason to believe” that the income has escaped assessment. It is also clear from the above that the reason [i.e information form the DDI(lnv)] given ... issuance of Notice u/s148 , can, at the most, be a ‘reason to suspect’ and is not a “reason to believe”. It is also clear from the above that the proceedings have been initiated on the basis of information from the DIT (Inv), Kolkata and on the satisfaction

The ACIT, Central Circle-1, Bhopal vs. DB Power Ltd, Bhopal

Appeal is dismissed

ITA 73/IND/2023[2015-16]Status: DisposedITAT Indore24 Jan 2024AY 2015-16

Bench: Shri Vijay Pal Rao & Shri B.M. Biyanim/S Db Power Limited, Acit, Central Circle-1, बनाम/ Office Block, 1A, Bhopal Vs. Db City Park, 5Th Floor, Corporate Block, Opp. M.P. Nagar Zone-1, Arera Hills, Bhopal (Pan:Aaccd5475F) (Assessee/Appellant) (Revenue/Respondent) Acit, Central Circle-1, M/S Db Power Limited, बनाम/ Bhopal Office Block, 1A, Vs. Db City Park, 5Th Floor, Corporate Block, Opp. M.P. Nagar Zone-1, Arera Hills, Bhopal (Pan:Aaccd5475F) (Revenue/Appellant) (Assessee/Respondent)

Section 139(1)Section 143(1)Section 143(2)Section 147Section 148Section 151Section 56(2)(viib)Section 69C

primary section empowering the AO to make assessment or reassessment. The said section 147 reads thus: “147. If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of section 148 to 153, assess

DB Power Ltd, Bhopal vs. The ACIT, Central Circle-1, Bhopal

Appeal is dismissed

ITA 68/IND/2023[2015-16]Status: DisposedITAT Indore24 Jan 2024AY 2015-16

Bench: Shri Vijay Pal Rao & Shri B.M. Biyanim/S Db Power Limited, Acit, Central Circle-1, बनाम/ Office Block, 1A, Bhopal Vs. Db City Park, 5Th Floor, Corporate Block, Opp. M.P. Nagar Zone-1, Arera Hills, Bhopal (Pan:Aaccd5475F) (Assessee/Appellant) (Revenue/Respondent) Acit, Central Circle-1, M/S Db Power Limited, बनाम/ Bhopal Office Block, 1A, Vs. Db City Park, 5Th Floor, Corporate Block, Opp. M.P. Nagar Zone-1, Arera Hills, Bhopal (Pan:Aaccd5475F) (Revenue/Appellant) (Assessee/Respondent)

Section 139(1)Section 143(1)Section 143(2)Section 147Section 148Section 151Section 56(2)(viib)Section 69C

primary section empowering the AO to make assessment or reassessment. The said section 147 reads thus: “147. If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of section 148 to 153, assess

M/S Ramji Board & Paper Mill Pvt Ltd, Mumbai vs. DCIT Central Circle 6 (2), Mumbai

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

ITA 3152/MUM/2023[2015-16]Status: DisposedITAT Mumbai24 Jan 2024AY 2015-16

Bench: Shri.Narender Kumar Choudhry () & Miss. Padmavathy S. ()

For Appellant: Ms. Dinkle Hariya a/wFor Respondent: Shri. Srinivas, Ld. DR
Section 147Section 148Section 250Section 40A(3)Section 69C

Assessing Officer accepted the contention of the Assessee and holds that the income for which he had initially formed a reason to believe had escaped assessment, as a matter of fact not escaped assessment, it is not open to the Assessing Officer independently to Assess some other income

Vayoo Nandan Finance Company Pvt Ltd, New Delhi vs. ITO Ward 26(2), New Delhi

In the result, the appeal of the assessee is allowed

ITA 3097/DEL/2019[2009-10]Status: DisposedITAT Delhi23 Jan 2024AY 2009-10

Bench: Shri M. Balaganeshm/S. Vayoo Nandan Finance Vs. Ito, Company Pvt. Ltd, Ward-26(2), B-6, Ganpati Apartment, 6, New Delhi Alipur Road, Civil Lines, New Delhi Pan: Aaavc0737F Assessee By : Dr. Rakesh Gupta, Adv Shri Shrey Jain, Adv Revenue By: Ms. Kirti Sankratyayan, Sr. Dr Date Of Hearing 04/01/2024 Date Of Pronouncement 23/01/2024

For Appellant: Dr. Rakesh Gupta, AdvFor Respondent: Ms. Kirti Sankratyayan, Sr. DR
Section 143(1)Section 143(3)Section 147Section 148

material facts necessary for its assessment. 5. Considering the above referred credible information and analysis subsequent to the information, I have reason to believe that an amount at least of Rs. 436643.7/- has escaped assessment in case the of M/s Vayoo Nandan Finance ... assessee nor its brokers were even impleaded in the said reasons. The reasons recorded only gives way to 'reason to suspect' and not 'reason to believe. The very same issue was even subject matter of adjudication of this tribunal in the case of Stratagem Portfolio (P) Ltd Vs. DCIT

Reserve Bank Staff and Officers Co-Op Credit Society Ltd, Mumbai vs. ITO Ward 26 (1)(1), Mumbai

In the result, all the five appeals filed by the assessee are allowed

ITA 3118/MUM/2023[2020-21]Status: DisposedITAT Mumbai22 Jan 2024AY 2020-21

Bench: Shri Prashant Maharishi, Am & Shri Rahul Chaudhary, Jm

For Appellant: Mr. Siddesh Mayekar, ARFor Respondent: Smt. Mahita Nair, DR
Section 143(3)Section 250Section 80PSection 80P(2)(a)Section 80P(2)(d)

reopening of assessment 2.1. The learned CIT(A) erred in upholding the validity of reopening of assessment even though there was no reason to believe that the income has escaped assessment and the assessment was reopened merely on the basis of audit objection. 2.2. The learned CIT (A) erred

Reserve Bank Staff and Officers Co-Op Credit Society Ltd, Mumbai vs. ITO Ward 26 (1)(1), Mumbai

In the result, all the five appeals filed by the assessee are allowed

ITA 3117/MUM/2023[2018-19]Status: DisposedITAT Mumbai22 Jan 2024AY 2018-19

Bench: Shri Prashant Maharishi, Am & Shri Rahul Chaudhary, Jm

For Appellant: Mr. Siddesh Mayekar, ARFor Respondent: Smt. Mahita Nair, DR
Section 143(3)Section 250Section 80PSection 80P(2)(a)Section 80P(2)(d)

reopening of assessment 2.1. The learned CIT(A) erred in upholding the validity of reopening of assessment even though there was no reason to believe that the income has escaped assessment and the assessment was reopened merely on the basis of audit objection. 2.2. The learned CIT (A) erred

Reserve Bank Staff and Officers Co-Op Credit Society Ltd, Mumbai vs. ITO Ward 26 (1) (1), Mumbai

In the result, all the five appeals filed by the assessee are allowed

ITA 3116/MUM/2023[2017-18]Status: DisposedITAT Mumbai22 Jan 2024AY 2017-18

Bench: Shri Prashant Maharishi, Am & Shri Rahul Chaudhary, Jm

For Appellant: Mr. Siddesh Mayekar, ARFor Respondent: Smt. Mahita Nair, DR
Section 143(3)Section 250Section 80PSection 80P(2)(a)Section 80P(2)(d)

reopening of assessment 2.1. The learned CIT(A) erred in upholding the validity of reopening of assessment even though there was no reason to believe that the income has escaped assessment and the assessment was reopened merely on the basis of audit objection. 2.2. The learned CIT (A) erred

Reserve Bank Staff and Officers Co-Op Credit Society Ltd, Mumbai vs. ITO Ward 26 (1)(1), Mumbai

In the result, all the five appeals filed by the assessee are allowed

ITA 3115/MUM/2023[2014-15]Status: DisposedITAT Mumbai22 Jan 2024AY 2014-15

Bench: Shri Prashant Maharishi, Am & Shri Rahul Chaudhary, Jm

For Appellant: Mr. Siddesh Mayekar, ARFor Respondent: Smt. Mahita Nair, DR
Section 143(3)Section 250Section 80PSection 80P(2)(a)Section 80P(2)(d)

reopening of assessment 2.1. The learned CIT(A) erred in upholding the validity of reopening of assessment even though there was no reason to believe that the income has escaped assessment and the assessment was reopened merely on the basis of audit objection. 2.2. The learned CIT (A) erred

Reserve Bank Staff and Officers Co-Op Credit Society Ltd, Mumbai vs. ITO Ward 26 (1) (1), Mumbai

In the result, all the five appeals filed by the assessee are allowed

ITA 3114/MUM/2023[2013-14]Status: DisposedITAT Mumbai22 Jan 2024AY 2013-14

Bench: Shri Prashant Maharishi, Am & Shri Rahul Chaudhary, Jm

For Appellant: Mr. Siddesh Mayekar, ARFor Respondent: Smt. Mahita Nair, DR
Section 143(3)Section 250Section 80PSection 80P(2)(a)Section 80P(2)(d)

reopening of assessment 2.1. The learned CIT(A) erred in upholding the validity of reopening of assessment even though there was no reason to believe that the income has escaped assessment and the assessment was reopened merely on the basis of audit objection. 2.2. The learned CIT (A) erred

DCIT, CC-06, New Delhi vs. Naveen Infradevelopers & Engineers Pvt. Ltd., New Delhi

In the result, the appeal of the Revenue in ITA No

ITA 80/DEL/2022[2012-13]Status: HeardITAT Delhi22 Jan 2024AY 2012-13

Bench: Shri N.K. Billaiya & Shri Yogesh Kumar U.S

For Appellant: Shri Rakesh Joshi, CAFor Respondent: Shri Subhra Jyoti Chakraborty, CIT- DR
Section 147Section 148Section 68

judgment is extracted as under: “5. The condition precedent to the exercise of the jurisdiction under section 147 is the formation of a reason to believe by the Assessing Officer that any income chargeable to tax has escaped assessment. Upon the formation or a reason to believe, the Assessing Officer ... serve on the assessee a notice requiring him to furnish a return of his income. Upon the formation of the reason to believe that income chargeable to tax has escaped assessment, the Assessing Officer is empowered to assess or reassess such income "and also" any other income chargeable

Radhe Developers (India) Ltd., Ahmedabad vs. The ACIT, Cir-3(1)(2), Ahmedabad

In the result, the appeal of the assessee is allowed

ITA 45/AHD/2023[2015-16]Status: DisposedITAT Ahmedabad19 Jan 2024AY 2015-16

Bench: Smt.Annapurna Gupta & Shri T.R. Senthil Kumarassessment Year :2015-16 Radhe Developers (India) Ltd. Acit, Cir.3(1)(2) 1St Floor, Chunibhai Chamber Vs Ahmedabad. B/H. City Gold Cinema Ashram Road Ahmedabad 380 009. Pan : Aaacr 9177 L

For Respondent: Ms.Saumya Pandey Jain, Sr.DR
Section 250(6)Section 271(1)(c)Section 36(1)(iii)

penalty order passed under section 271(1)(c) 4 of the Act, wherein at para-4, the AO clearly mentions that he has reasons to believe that the assessee has furnished inaccurate particulars of income pertaining to the valuation of closing stock amounting to Rs.24,53,100/-. The same ... this ground to the total income of the assessee. The CIT(A) confirmed the addition of Rs. 24,53,1000/- I have therefore reason to believe that the assessee has furnished inaccurate particulars of income and thereby concealed the particulars of Its Income. Therefore, it clearly emerges that the particulars

Shiva Ranjani Vejja, Hyderabad vs. Income Tax Officer, Ward-12(2), Hyderabad

In the result, the appeal of the assessee is partly allowed

ITA 267/HYD/2020[2013-14]Status: DisposedITAT Hyderabad19 Jan 2024AY 2013-14

Bench: Shri R.K. Panda & Shri Laliet Kumar

For Appellant: Shri Mohd. Afzal, AdvocateFor Respondent: Ms. Sheetal Sarin, Sr. AR
Section 144Section 147Section 148Section 2Section 69A

noted that the assessee had not filed her return of income for AY 2013-14 and therefore prima-facie, there was reason to believe that income had escaped assessment attracting provisions of section 147 of the Income Tax Act, 1961. 3.1. Accordingly, a notice