← All Phrases

“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

Shree Krishna Gyanodaya Flour Mills Pvt. Ltd., Kolkata vs. ACIT, Central Circle 4(3), Kolkata

In the result, the appeal of the assessee is allowed

ITA 2179/KOL/2025[2011-2012]Status: DisposedITAT Kolkata31 Dec 2025AY 2011-2012

Bench: Shri Rajesh Kumar, Am & Shri Pradip Kumar Choubey, Jm Shree Krishna Gyanodaya Acit, Central Circle 4(3) Flour Mills Pvt. Ltd. Aaykar Bhawan Poorva 15Th Floor, 46C, Chowringhee 110, Kolkata-700107, Vs. Road, Everest House, Kolkata- West Bengal 700071, West Bengal (Appellant) (Respondent) Pan No. Aahcs8774P Assessee By : Shri S.K. Tulsiyan, Ar Revenue By : Shri Sanat Kumar Raha, Dr Date Of Hearing: 01.12.2025 Date Of Pronouncement: 31.12.2025

For Appellant: Shri S.K. Tulsiyan, ARFor Respondent: Shri Sanat Kumar Raha, DR
Section 139(1)Section 143(2)Section 143(3)Section 144Section 147Section 148Section 151(1)Section 153ASection 68

assessment. The ld. AR submitted that the ld. AO has only reasons to suspect as to the escapement of income and not the reasons to believe. The ld. AR submitted that the ld. AO has straightway come to the conclusion that income has escaped assessment. The ld. AR submitted that ... basis of borrowed satisfaction cannot be sustained where the reasons failed to demonstrate live link between the tangible material and formation of the reason to believe that the income has escaped assessment. 3.1. The ld. AR also referred to the Circular of the CBDT 147/140/2017-A7PC-1 dated 10.01.2018, which lays down

Ipf Vikram India Private Limited, Chandigarh vs. Dy. Commissioner of Income Tax, Circle, Panchkula

In the result, appeal of the Assessee is allowed for statistical purposes

ITA 1204/CHANDI/2024[2014-15]Status: DisposedITAT Chandigarh30 Dec 2025AY 2014-15

Bench: SHRI. LALIET KUMAR (Judicial Member), SHRI. KRINWANT SAHAY (Accountant Member)

For Appellant: Shri Tejmohan Singh, AdvocateFor Respondent: Shri Vivek Vardhan, Addl. CIT, Sr. DR
Section 143(3)Section 148

well as on facts in as much in upholding of the assessment in as much as there has been no reason to believe that there was an escapement of income which is based only on an audit objection and as such the order passed is illegal, arbitrary and unjustified

Sudarshan Jeans Private Limited, Kolhapur vs. ITO, Ambala

The appeal stand allowed

ITA 1070/CHANDI/2024[2015-16]Status: DisposedITAT Chandigarh30 Dec 2025AY 2015-16

Bench: SHRI LALIET KUMAR (Judicial Member), SHRI MANOJ KUMAR AGGARWAL (Accountant Member)

For Appellant: Sh. Rohit Goel (CA) – Ld. ARFor Respondent: Dr. Ranjit Kaur (Addl. CIT) – Ld. Sr. DR
Section 142(1)Section 143(3)Section 147Section 148Section 32(1)(iia)

link with formation of belief. With effect from 1-4-1989, the condition to reopen the case is that Ld. AO must have reasons to believe that income had escaped assessment. Post 01-04-1989, power to re-open is much wider. However, one needs to give a schematic interpretation ... words 'reason to believe', failing which Sec. 147 would give arbitrary powers to the Assessing Officer to reopen assessments on the basis of 'mere change of opinion', which cannot be per se reason to reopen. One must also keep in mind the conceptual difference between power to review and power

Shri Vipul Bansal, Mumbai vs. Income Tax Officer Ward 7(1)(2), Mumbai

The appeal of the assessee is partly allowed for statistical purposes

ITA 5628/MUM/2025[2010-11]Status: DisposedITAT Mumbai30 Dec 2025AY 2010-11

Bench: Shri Sandeep Singh Karhail & Shri Makarand Vasant Mahadeokar

Section 131Section 143(3)Section 147Section 148Section 250Section 271(1)(c)Section 37(1)Section 69C

Income-tax Officer – Ward 7(1)(2), Mumbai (‘AO') in reopening the assessment under section 147 without satisfying the requisite condition of possessing reasons to believe for such reopening. The appellant prays that your honours declare the reopening as bad in law; 2. On facts and circumstances of the case ... recording the reasons for reopening. It was contended that after making such enquiry and examination, the Assessing Officer was satisfied that there existed reason to believe that income chargeable to tax had escaped assessment, and therefore, initiation of proceedings under section 147 was in accordance with law. The learned

Hardayal Milk Products Private Limited, Shikohabad vs. DCIT, Circle-2(2)(1), Firozabad

In the result, both the appeals filed by assessee are allowed

ITA 344/AGR/2025[2013-14]Status: DisposedITAT Agra29 Dec 2025AY 2013-14

Bench: : Shri S. Rifaur Rahman & Shri Sunil Kumar Singh

Section 143(3)Section 145(3)Section 147Section 148Section 151Section 250Section 68

basis to ignite/ trigger "reason to suspect". The AO has to carry out further examination to convert the "reason to suspect" into "reason to believe". If the AO acts on borrowed satisfaction and without application of mind, the reopening is void. g) GOKUL AGRO RESOURCES LIMITED vs. DCIT ... conclusion drawn by the Assessing Officer merely on receipt of the information does not muster the requirement of law to validly form the reason to believe escapement of income. With the said reasoning, the appeal filed by the revenue was dismissed. In the instant case, the Tribunal has analysed

Hardayal Milk Products Private Limited, Shikohabad vs. DCIT, Circle-2(2)(1), Firozabad

In the result, both the appeals filed by assessee are allowed

ITA 343/AGR/2025[2013-14]Status: DisposedITAT Agra29 Dec 2025AY 2013-14

Bench: : Shri S. Rifaur Rahman & Shri Sunil Kumar Singh

Section 143(3)Section 145(3)Section 147Section 148Section 151Section 250Section 68

basis to ignite/ trigger "reason to suspect". The AO has to carry out further examination to convert the "reason to suspect" into "reason to believe". If the AO acts on borrowed satisfaction and without application of mind, the reopening is void. g) GOKUL AGRO RESOURCES LIMITED vs. DCIT ... conclusion drawn by the Assessing Officer merely on receipt of the information does not muster the requirement of law to validly form the reason to believe escapement of income. With the said reasoning, the appeal filed by the revenue was dismissed. In the instant case, the Tribunal has analysed

Jm Financial Foundation, Mumbai vs. ITO (Exemption)-Ward-1(4), Mumbai

In the result, appeal filed by assessee stands at for statistical purposes

ITA 6558/MUM/2025[2018-19]Status: DisposedITAT Mumbai29 Dec 2025AY 2018-19

Bench: Smt. Beena Pillai () & Shri Makarand Vasant Mahadeokar ()

Section 11Section 11(2)Section 147Section 148Section 151A

appellant u/s. 147 on the ground of addition of CR contribution received during the year without appreciating that there did not exist any reason to believe that income escaped assessment and reopening is on the basis of borrowed satisfaction and hence reopening of assessment is bad in law. 2. That

Jm Financial Foundation, Mumbai vs. ITO (Exem) Ward 1(4), Mumbai

In the result, appeal filed by assessee stands at for statistical purposes

ITA 6557/MUM/2025[2017-18]Status: DisposedITAT Mumbai29 Dec 2025AY 2017-18

Bench: Smt. Beena Pillai () & Shri Makarand Vasant Mahadeokar ()

Section 11Section 11(2)Section 147Section 148Section 151A

appellant u/s. 147 on the ground of addition of CR contribution received during the year without appreciating that there did not exist any reason to believe that income escaped assessment and reopening is on the basis of borrowed satisfaction and hence reopening of assessment is bad in law. 2. That

Ratori Maa Trading P.Ltd, Delhi vs. ITO, Ward-21(1), New Delhi

In the result, the appeal is dismissed

ITA 4485/DEL/2019[2010-11]Status: DisposedITAT Delhi29 Dec 2025AY 2010-11

Bench: Shri Yogesh Kumar U.S. & Shri Naveen Chandraratori Maa Trading P. Ltd. Vs Ito M-98, 2Nd Floor, Jagat Ward -21(1) Rampark, Laxmi Nagar, New C. R. Building, New Delhi Delhipan: Aaecr0612A Appellant Respondent Assessee By None Revenue By Ms. Harpreet Kaur Hansra, Sr. Dr Date Of Hearing 18/12/2025 Date Of Pronouncement 29/12/2025 Order Per Yogesh Kumar, U.S. Jm: The Present Appeal Is Filed By The Assessee Against The Order Of Ld. Commissioner Of Income Tax (Appeals)-7, New Delhi Dated

Section 143(3)Section 147Section 148Section 151

believe that income had escaped assessment and proceedings were initiated after recording reasons. A re-assessment is valid if there is prime facie reason to believe that income had escapedassessment Information was received by the AO and reasons were recorded that there was escapement of income. This has been reaffirmed ... scope of section 147 has been considerably widened. After the amendment, the only requirement under the section is that AO must have reason to believe that any income chargeable to tax has escaped assessment for any assessment year The AO is not required to conclusively prove escapement of income

Thulasi Chamarthy, Chittoor vs. Income Tax Officer, Ward - 1, Chittoor

In the result, the appeal filed by the assessee is allowed in terms of our aforesaid observations

ITA 1374/HYD/2025[2018-19]Status: DisposedITAT Hyderabad24 Dec 2025AY 2018-19
Section 147Section 148Section 148ASection 151Section 250Section 54Section 54F

reasons, the same gave rise to numerous litigations and the reopening were challenged inter alia, on the grounds such as (1) no valid “reason to believe” (2) no tangible/reliable material /information in possession of the assessing officer leading to formation of belief that income has escaped assessment, (3) no enquiry

Income-Tax Officer - 12(1)(1), Mumbai vs. Blues It Innovations India Private Limited, Mumbai

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

ITA 6465/MUM/2025[2011-12]Status: DisposedITAT Mumbai24 Dec 2025AY 2011-12

Bench: Shri Pawan Singh & Shri Girish Agrawal

Section 143(3)Section 145(3)Section 234ASection 254(1)Section 69C

information received from investigation wing. c. Reassessment proceeding cannot be initiated when the LD AO have reason to suspect and not reason to believe 8. On the facts and in the circumstances of the case and in law, The Ld. CIT(A) erred in confirming the charging of interest under

Blues It Innovations India Private Limited, Mumbai vs. ITO - 12(1)(1), Mumbai

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

ITA 6300/MUM/2025[2014-15]Status: DisposedITAT Mumbai24 Dec 2025AY 2014-15

Bench: Shri Pawan Singh & Shri Girish Agrawal

Section 143(3)Section 145(3)Section 234ASection 254(1)Section 69C

information received from investigation wing. c. Reassessment proceeding cannot be initiated when the LD AO have reason to suspect and not reason to believe 8. On the facts and in the circumstances of the case and in law, The Ld. CIT(A) erred in confirming the charging of interest under

Blues It Innovations India Private Limited, Mumbai vs. ITO -12(1)(1), Mumbai

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

ITA 6299/MUM/2025[2013-14]Status: DisposedITAT Mumbai24 Dec 2025AY 2013-14

Bench: Shri Pawan Singh & Shri Girish Agrawal

Section 143(3)Section 145(3)Section 234ASection 254(1)Section 69C

information received from investigation wing. c. Reassessment proceeding cannot be initiated when the LD AO have reason to suspect and not reason to believe 8. On the facts and in the circumstances of the case and in law, The Ld. CIT(A) erred in confirming the charging of interest under

Blues It Innovations India Private Limited, Mumbai vs. ITO - 12(1)(1), Mumbai

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

ITA 6298/MUM/2025[2012-13]Status: DisposedITAT Mumbai24 Dec 2025AY 2012-13

Bench: Shri Pawan Singh & Shri Girish Agrawal

Section 143(3)Section 145(3)Section 234ASection 254(1)Section 69C

information received from investigation wing. c. Reassessment proceeding cannot be initiated when the LD AO have reason to suspect and not reason to believe 8. On the facts and in the circumstances of the case and in law, The Ld. CIT(A) erred in confirming the charging of interest under

Blues It Innovations India Private Limited, Mumbai vs. ITO - 12(1)(1), Mumbai

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

ITA 6297/MUM/2025[2011-12]Status: DisposedITAT Mumbai24 Dec 2025AY 2011-12

Bench: Shri Pawan Singh & Shri Girish Agrawal

Section 143(3)Section 145(3)Section 234ASection 254(1)Section 69C

information received from investigation wing. c. Reassessment proceeding cannot be initiated when the LD AO have reason to suspect and not reason to believe 8. On the facts and in the circumstances of the case and in law, The Ld. CIT(A) erred in confirming the charging of interest under

The Hisar Leading Bank Co-Op Non-Agri Thrift & Credit Society, Hisar vs. Income-Tax Officer, Ward-1, Hisar

In the result, both appeals of the assessee are allowed

ITA 5114/DEL/2025[2017-18]Status: DisposedITAT Delhi24 Dec 2025AY 2017-18

Bench: Shri S. Rifaur Rahman & Shri Raj Kumar Chauhan

Section 139(1)Section 142(1)Section 147Section 148Section 148ASection 68

erred in confirming the order dated 06-05-23, as proceeding initiated u/s 147 of the Act is without there being any reason to believe that income has escaped assessment. 6. Ld. CIT(A) has erred in confirming the order dated 06-05-23, as order passed u/s 147 r.w.s

The Hisar Leading Bank Co-Op Non-Agri Thrift & Credit Society, Hisar vs. Income-Tax Officer, Ward-1, Hisar

In the result, both appeals of the assessee are allowed

ITA 5113/DEL/2025[2016-17]Status: DisposedITAT Delhi24 Dec 2025AY 2016-17

Bench: Shri S. Rifaur Rahman & Shri Raj Kumar Chauhan

Section 139(1)Section 142(1)Section 147Section 148Section 148ASection 68

erred in confirming the order dated 06-05-23, as proceeding initiated u/s 147 of the Act is without there being any reason to believe that income has escaped assessment. 6. Ld. CIT(A) has erred in confirming the order dated 06-05-23, as order passed u/s 147 r.w.s

Hiteshbhai Rameshbhai Patel, Surat vs. ITO Ward, 2, Bardoli

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

ITA 484/SRT/2025[2012-13]Status: DisposedITAT Surat23 Dec 2025AY 2012-13

Bench: Shri Sandeep Gosain () & Shri Om Prakash Kant () Assessment Year: 2012-13 Hiteshbhai Rameshbhai Patel Income Tax Officer, 466 Kanbivad, Goddha Mahuwa, Ward-2, Bardoli, Income Tax Taluka Valod, Dist. Surat 394630 Vs. Office, 2Nd Floor, Bsnl Gujarat, Building, Opp. Jalaram Temple, Station Road, Bardoli- 394601 Pan No. Avdpp 6788 Q Appellant Respondent Assessee By : Mr. Sakar Sharma, Ar Revenue By : Mr. J.K. Chandani, Sr-Dr

For Appellant: Mr. Sakar Sharma, ARFor Respondent: Mr. J.K. Chandani, Sr-DR
Section 143(3)Section 147Section 148Section 151(1)Section 68

income for the year under consideration. 2.1 Having regard to the aforesaid information and the magnitude of cash deposits, the Assessing Officer recorded reasons to believe that income to the extent of ₹41,49,120/- had escaped assessment within the meaning of section 147 of the Income ... assessment. 7.2 At the stage of initiation of proceedings under section 147, the Assessing Officer is only required to form a prima facie “reason to believe” that income chargeable to tax has escaped assessment, and not to conclusively establish such escapement. As consistently held by the Hon‟ble Supreme Court

Kunal Vyas, Indore vs. ITO 4(1), Ind, Main Building, Indore

The appeal of the assessee is allowed for statistical purposes

ITA 201/IND/2025[2018-19]Status: DisposedITAT Indore23 Dec 2025AY 2018-19

Bench: Shri Siddhartha Nautiyal & Shri Bhagirath Mal Biyani

For Appellant: Shri Ankit Sijariya, AdvFor Respondent: Shri Ashish Porwal, Sr. DR
Section 144Section 144BSection 148Section 68Section 69

live link, no notice under that section can be issued merely on the basis of some allegation. Further, they failed to record any 'reason to believe' that both the income has escaped assessment both the orders deserves to be set aside / quashed. 2) Because, the impugned assessment order as also

Khazana Stores Pvt. Ltd., Ahmedabad vs. The ITO, Ward-2(1)(1), Ahmedabad

ITA 1506/AHD/2025[2017-18]Status: DisposedITAT Ahmedabad23 Dec 2025AY 2017-18

Bench: Shri Sanjay Garg & Shri Makarand Vasant Mahadeokarआयकर अपील सं/Ita No. 1506/Ahd/2025 निर्धारण वर्ष / Assessment Year : 2017-18 Khazana Stores Pvt. Ltd. The Ito Gf 2 Commerce House 2 बनाम/ Ward 2(1)(1) Judges Bunglow Road, V/S. Ahmedabad 380 015 Bodakdev, Ahmedabad 380 054 स्थायी लेखा सं./Pan: Aaack 7880 R (अपीलार्थी/ Appellant) (प्रत्यर्थी / Respondent) Assessee By: Shri S.N. Divatia & Shri Samir Vora, Ars Revenue By : Shri Kalpesh Rupavatia, Sr. Dr सुनवाई की तारीख/Date Of Hearing : 30/09/2025 घोषणा की तारीख / Date Of Pronouncement: 23/12/2025 आदेश/Order Per Sanjay Garg: The Present Appeal Has Been Preferred By The Assessee Against The Order Of The Learned Commissioner Of Income Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi [Hereinafter Referred To As 'Cit(A)'] Dated 07/07/2025 For Assessment Year (Ay) 2017-18. 2. The Assessee, In This Appeal Has Taken The Following Grounds Of Appeal:

For Appellant: Shri S.N. Divatia &For Respondent: Shri Kalpesh Rupavatia, Sr. DR
Section 143(1)Section 147Section 148Section 250Section 69A

that the proposal of the reopening of the assessment is not prepared on the format given due to paucity of time and only reason to believe is prepared. The information received from the DGIT(System), New Delhi is being forwarded to the Assessing Officer(s) for considering the same during ... course of assessment proceedings. Your, Honour is, therefore, requested to kindly consider the same for approval. BASIS OF FORMING REASON TO BELIEVE AND DETAILS OF ESCAPEMENT OF INCOME As per the information received from the credible sources and preliminary investigation clearly reveal that the assessee has received in his bank