“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

M/S. Awas Developers & Constructions P. Ltd., Mumbai vs. Dy CIT, CC-5(4), Mumbai

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

ITA 342/MUM/2021[2012-13]Status: DisposedITAT Mumbai23 Sept 2022AY 2012-13

Bench: Shri Baskaran B R& Shri Pavan Kumar Gadalem/S. Awas Developers Vs. Deputy Commissioner & Constructions Pvt. Of Income Tax, Central Ltd. Circle 5(4) Room No. 6, 3Rd Floor, Mumbai-400021 Capri, Anant Kanekar Marg, Bandra East, Mumbai-400051 Pan No. Aadca0702D Appellant .. Respondent

Section 143(2)Section 143(3)Section 147Section 148Section 14A

total income of Rs. Nil. Subsequently, the Assessing Officer has received the information that the income has been under assessed and has a reason to believe that the income has escaped in assessment and issued notice ITA .No.342/M/2021 under Section 148 of the Act and the assessee was also provided

Sivakumaran Pugazhendhi, Chennai vs. PCIT, Chennai-4

In the result, the appeal of the assessee is allowed

ITA 27/CHNY/2022[2014-15]Status: DisposedITAT Chennai21 Sept 2022AY 2014-15

Bench: Shri Mahavir Singhand Shri Manoj Kumar Aggarwalआयकर अपील सं./Ita No.27/Chny/2022 िनधा"रण वष" /Assessment Year: 2014-15 Sivakumaran Pugazhendhi, The Principal Commissioner 70 Raja Agraharam Street, Vs. Of Income Tax, Poonamalle, Chennai-4. Chennai – 600 056. [Pan: Aiapp-7309-R] (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से/ Appellant By : Ms. T.V. Muthu Abirami, Advocate ""यथ" क" ओर से /Respondent By : Shri M. Rajan, Cit सुनवाई क" तारीख/Date Of Hearing : 05.09.2022 : 21.09.2022 घोषणा क" तारीख /Date Of Pronouncement आदेश / O R D E R

For Appellant: Ms. T.V. Muthu Abirami, AdvocateFor Respondent: Shri M. Rajan, CIT

Section 143(3)Section 147Section 263

cash deposits, it is clear that same has not been accounted in the books of the assessee. Therefore, I have the reason to believe that the amount of Rs. 50,00,000/-has escaped assessment within the meaning of explanation 2© of Section 147....." 8. In view of the above ... what constitutes escape of assessment. In order to invoke jurisdiction under Section 147(a) of the Act, the ITO must have reason to believe that some income chargeable to tax of an assessee has escaped assessment by reason of the omission or failure on the part of the assessee either

Asian Business Connections Pvt. Ltd, Mumbai vs. Comm of Income Tax-Central Circle 5(3), Mumbai

In the result, the appeal filed by the assesse is allowed for statistical purpose

ITA 917/MUM/2022[2012-13]Status: DisposedITAT Mumbai21 Sept 2022AY 2012-13

Bench: Shri Baskaran B.R& Shri Pavan Kumar Gadaleasian Business Connections Vs. Commissioner Of Income Tax, Pvt. Ltd. Central Circle 5(3), Fm-18 Mansarovar Complex No. 7 Shivaji Nagar, Bhopal Mumbai-400020 Madhya Pradesh - 462016

Section 133(6)Section 143(2)Section 148Section 250Section 294BSection 69Section 69C

917/M/2022 any submissions on the enquiries from the investigation wing and the assessee is one of the beneficiary. Therefore, the Assessing Officer has reason to believe that the income has escaped the Assesseement and after recording the reasons for reopening of assessment has issued notice under Section

Mr. Ankit Girishkumar Vasani, Mumbai vs. ITO 35(1) (2), Mumbai

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

ITA 1593/MUM/2021[2009-10]Status: DisposedITAT Mumbai21 Sept 2022AY 2009-10

Section 144Section 147Section 148

escape assessment of a part of its income. Prima facie, this appears to be a case of reason to suspect and not reason to believe that income chargeable to tax has escaped assessment. 5. In the above view, prima facie, we are of the view that the impugned notice ... without jurisdiction as it lacks reason to believe that income chargeable to tax has escaped assessment.” The facts in the present case are identical with the facts in the case decided by Hon’ble Bombay High Court. Accordingly, we hold that the reopening of assessment

Sai Shipping Company Pvt Ltd, Mumbai vs. Income Tax Officer/NFAC, Delhi

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

ITA 427/MUM/2022[2012-13]Status: DisposedITAT Mumbai20 Sept 2022AY 2012-13

Section 115JSection 139Section 139(1)Section 142Section 143Section 143(3)Section 144BSection 147Section 148

disclosed material facts necessary for his assessment for the year under consideration thereby necessitating reopening u/s. 147 of the Act. Thus I have reasons to believe that income to the extent of Rs. 6,07,62,673/- chargeable to tax has escaped assessment within the meaning of section ... from the end of the relevant year has expired in this case, the requirements to initiate proceeding us 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

Glowshine Builders & Developers Pvt Ltd., Mumbai vs. ITO 12(2)(3), Mumbai

The appeal of the assessee is partly allowed

ITA 1332/MUM/2020[2011-12]Status: DisposedITAT Mumbai20 Sept 2022AY 2011-12

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm Ito Glowshine Builders & Developers Ward 12(2)(3) Pvt. Ltd. Aaykar Bhavan, Cts 40-44, M.K. Road, Sahara India Point S V Road, Vs. Goregaon West, Churchgate, Mumbai-400 104 Mumbai-400 020 (Respondent) (Appellant) Pan No. Aaacg3422F Assessee By : None Revenue By : Shri Prabhat Kumar Gupta, Dr Date Of Hearing: 07.09.2022 Date Of Pronouncement : 20.09.2022

For Appellant: NoneFor Respondent: Shri Prabhat Kumar Gupta, DR

Section 144Section 147Section 148Section 68

Assessing Officer by holding that Ex-Parte order u/s 144 has been rightly passed by him. 4. That without prejudice there was no reason to believe that Income chargeable to tax has escaped assessment with the Assessing Officer and therefore the very reopening of the case of Assessment Year ... value of the Glowshine Builders & Developers Pvt. Ltd.; A.Y. 11-12 shares is merely face value. Therefore, the learned assessing officer recorded ‘reasons to believe’ u/s 147 of the act and issued notice for reopening of the assessment. The notice was issued to the last known address of the assessee

Arrow Grentech Ltd., Mumbai vs. DCIT 9 (1)92), Mumbai

In the result, appeals filed by the assessee are allowed

ITA 7849/MUM/2019[2015-16]Status: DisposedITAT Mumbai20 Sept 2022AY 2015-16

Bench: Shri Kuldip Singh, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

Section 115JSection 143(2)Section 35Section 35(1)(ii)

recognition was withdrawn on 6th September 2016 & 15th September 2016 respectively and the assessee was not aware of the same and had no reason to believe the Foundation was involved in facilitating bogus donation as mentioned by the Assessing Officer in his assessment order. Assessing Officer rejected submissions ... recognition was withdrawn on 6th September, 2016 & 15th September 2016 respectively and the Appellant were not aware of the same and had no reason to believe the Foundation was involved in facilitating bogus donation as mentioned by the Ld. A.O. in the assessment order. The moot question is whether

Arrow Grentech Ltd., Mumbai vs. DCIT 9 (1)92), Mumbai

In the result, appeals filed by the assessee are allowed

ITA 7848/MUM/2019[2014-15]Status: DisposedITAT Mumbai20 Sept 2022AY 2014-15

Bench: Shri Kuldip Singh, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

Section 115JSection 143(2)Section 35Section 35(1)(ii)

Sri M G Anand Reddy, Bangalore vs. The Assistant Commissioner of Income Tax, Central Circle-2(1), Bengaluru

In the result, the appeals by the assessee are partly allowed

ITA 762/BANG/2021[2015-16]Status: DisposedITAT Bangalore20 Sept 2022AY 2015-16

Bench: Shri N.V. Vasudevan & Ms Padmavathy S

For Appellant: Shri V. Srinivasan, AdvocateFor Respondent: Shri Manjunath Karkihalli, CIT(DR)(ITAT), Bengaluru

Section 10BSection 132Section 143(2)Section 153ASection 234B

Director or the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, in consequence of information in his possession, has reason to believe that— (a) any person to whom a summons under sub-section (1) of section 37 of the Indian Income ... books of account, other documents or assets to the requisitioning officer. Explanation.—For the removal of doubts, it is hereby declared that the reason to believe, as recorded by the income-tax authority under this sub-section, shall not be disclosed to any person or any authority or the Appellate

Sri M.G. Anand Reddy, Bengaluru vs. The Assistant Commissioner of Income Tax, Central Circle-2(1), Bengaluru

In the result, the appeals by the assessee are partly allowed

ITA 761/BANG/2021[2014-15]Status: DisposedITAT Bangalore20 Sept 2022AY 2014-15

Bench: Shri N.V. Vasudevan & Ms Padmavathy S

For Appellant: Shri V. Srinivasan, AdvocateFor Respondent: Shri Manjunath Karkihalli, CIT(DR)(ITAT), Bengaluru

Section 10BSection 132Section 143(2)Section 153ASection 234B

Sri M G Anand Reddy, Bengaluru vs. The Assistant Commissioner of Income Tax, Central Circle-2(1), Bengaluru

In the result, the appeals by the assessee are partly allowed

ITA 760/BANG/2021[2013-14]Status: DisposedITAT Bangalore20 Sept 2022AY 2013-14

Bench: Shri N.V. Vasudevan & Ms Padmavathy S

For Appellant: Shri V. Srinivasan, AdvocateFor Respondent: Shri Manjunath Karkihalli, CIT(DR)(ITAT), Bengaluru

Section 10BSection 132Section 143(2)Section 153ASection 234B

Sri M.G. Anand Reddy, Bengaluru vs. The Assistant Commissioner of Income Tax, Central Circle-2(1), Bengaluru

In the result, the appeals by the assessee are partly allowed

ITA 759/BANG/2021[2012-13]Status: DisposedITAT Bangalore20 Sept 2022AY 2012-13

Bench: Shri N.V. Vasudevan & Ms Padmavathy S

For Appellant: Shri V. Srinivasan, AdvocateFor Respondent: Shri Manjunath Karkihalli, CIT(DR)(ITAT), Bengaluru

Section 10BSection 132Section 143(2)Section 153ASection 234B

Sri M.G. Anand Reddy, Bengaluru vs. The Assistant Commissioner of Income Tax, Central Circle-2(1), Bengaluru

In the result, the appeals by the assessee are partly allowed

ITA 758/BANG/2021[2011-12]Status: DisposedITAT Bangalore20 Sept 2022AY 2011-12

Bench: Shri N.V. Vasudevan & Ms Padmavathy S

For Appellant: Shri V. Srinivasan, AdvocateFor Respondent: Shri Manjunath Karkihalli, CIT(DR)(ITAT), Bengaluru

Section 10BSection 132Section 143(2)Section 153ASection 234B

Sri M.G. Anand Reddy, Bengaluru vs. The Assistant Commissioner of Income Tax, Central Circle-2(1), Bengaluru

In the result, the appeals by the assessee are partly allowed

ITA 757/BANG/2021[2010-11]Status: DisposedITAT Bangalore20 Sept 2022AY 2010-11

Bench: Shri N.V. Vasudevan & Ms Padmavathy S

For Appellant: Shri V. Srinivasan, AdvocateFor Respondent: Shri Manjunath Karkihalli, CIT(DR)(ITAT), Bengaluru

Section 10BSection 132Section 143(2)Section 153ASection 234B

Sri. M.G. Anand Reddy, Bengaluru vs. The Assistant Commissioner of Income Tax, Central Circle-2(1), Bengaluru

In the result, the appeals by the assessee are partly allowed

ITA 756/BANG/2021[2009-10]Status: DisposedITAT Bangalore20 Sept 2022AY 2009-10

Bench: Shri N.V. Vasudevan & Ms Padmavathy S

For Appellant: Shri V. Srinivasan, AdvocateFor Respondent: Shri Manjunath Karkihalli, CIT(DR)(ITAT), Bengaluru

Section 10BSection 132Section 143(2)Section 153ASection 234B

M/S Macmillan Publishers India Pvt Ltd, Chennai vs. ITO, Corporate Circle 4 (1), Chennai

In the result, the appeal filed by assessee is allowed

ITA 2784/CHNY/2019[2011-12]Status: DisposedITAT Chennai19 Sept 2022AY 2011-12

Bench: Shri Mahavir Singhand Shri G. Manjunathaआयकर अपील सं./Ita No.: 2784/Chny/2019 िनधा"रण वष" /Assessment Year: 2011-12 Macmillan Publishers India The Acit, Pvt. Ltd., V. Corporate Circle 4(1), No.21, Patullos Road, Chennai. Chennai – 600 002. Pan: Aafcm 5564R (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से/Appellant By : Shri R. Vijayaraghavan, Advocate ""यथ" क" ओर से/Respondent By : Shri P. Sajit Kumar, Jcit सुनवाई क" तार"ख/Date Of Hearing : 19.09.2022 घोषणा क" तार"ख/Date Of Pronouncement : 19.09.2022 आदेश /O R D E R Per Mahavir Singh: This Appeal By The Revenue Is Arising Out Of The Order Of Commissioner Of Income Tax (Appeals)-8, Chennai In Ita No.69/18- 19 Dated 16.07.2019. The Re-Assessment Was Framed By The Acit, Company Circle 4(1), Chennai For The Assessment Year 2011-12 U/S.143(3) R.W.S.147 Of The Income-Tax Act, 1961 (Hereinafter The ‘Act’) Vide Order Dated 30.12.2018. I.T.A. No.2784/Chny/2019 2 2. The First Issue In This Appeal Of Assessee Is As Regards To The Order Of Cit(A) Confirming The Action Of Ao In Reopening Of Assessment U/S.147 R.W.S 148 Of The Act Even Though There Is No Failure On The Part Of The Assessee To Disclose Fully & Truly The Material Fact Necessary For Its Assessment For The Relevant Assessment Year & The Original Assessment Was Completed U/S.143(3) Of The Act. For This, Assessee Has Raised Various Grounds Regarding Reopening Which Are Exhaustive & Argumentative, Hence Need Not To Be Reproduced.

For Appellant: Shri R. Vijayaraghavan, AdvocateFor Respondent: Shri P. Sajit Kumar, JCIT

Section 143(3)Section 147Section 148

return rights. The assessee has only made a mere provision towards return rights and not actually incurred.” 4) Hence, I have every reason to believe that the income chargeable to tax has escaped assessment under the provisions of section 147 of the Income- tax Act, 1961.” I.T.A. No.2784/Chny/2019 ... with effect from April 1, 1989. The relevant part of the new Section 147 is as follows : "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 sections

Kitir Laxmichand Lapsia, Mumbai vs. ACIT 17(2), Mumbai

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

ITA 1202/MUM/2020[2014-15]Status: DisposedITAT Mumbai15 Sept 2022AY 2014-15

Bench: Shri Pavan Kumar Gadale & Shri Amarjit Singhkirit Laxmichand Lapsia Vs. Acit-17(2) A-43, Bharat Thirth Chs, R.No. 137, Aayakar V. N. Purav Marg, Bhavan, M.K. Road, Chembur – 400 071 Mumbai - 400020

For Appellant: M.SubramaianFor Respondent: Tejinder Pal Singh Anand

Section 143(3)Section 148Section 35Section 35(1)(ii)

There is no subjective and specific confirmation from any person in regard to commissions or cash backs received by your assessee. (e) The reason to believe has not brought any subjective concrete findings in order to allege income escapement in your assessee. (f) There is no evidence to draw

Surplus Finvest P. Ltd, Mumbai vs. Pr. CIT-11, Mumbai

In the result, appeal by the assessee is dismissed

ITA 1971/MUM/2020[2015-16]Status: DisposedITAT Mumbai14 Sept 2022AY 2015-16

Bench: Shri G.S. Pannu & Shri Sandeep Singh Karhail

For Appellant: Shri Vipul Joshi, Advocate, a/wFor Respondent: Shri Ashok Kumar Kardam, CIT - DR

Section 143Section 143(3)Section 144BSection 147Section 253(3)Section 263

No.1971/Mum./2020 4. Section 147 of the Act contemplates three primary conditions for the initiation of reassessment proceedings:  There should be a reason to believe, that  Income chargeable to tax, has  Escaped assessment 5. As per explanation 1 of the section 147 of the IT Act 1961, mere production before ... necessarily amount to disclosure within the meaning of the foregoing provisions of section 147 of the IT Act. Hence I have a reason to believe that the income chargeable to tax has escaped assessment under the meaning of section 147 of the Income tax Act, 1961. 6. The under signed

Harvinder Oberai, Mumbai vs. Income Tax Officer 23(1) (5), Mumbai

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

ITA 1840/MUM/2022[2013-14]Status: DisposedITAT Mumbai12 Sept 2022AY 2013-14

Bench: Shri Pavan Kumar Gadale & Shri Amarjit Singhharvinder Oberai Vs. Ito-23(1)(5), 11, Tulsi Mahal, Room No. 114, Matru Opp Teresa School, Mandir, Tardeo , 26Th Road, Bandra, Mumbai -400007. Mumbai-400050 Pan/Gir No. Aasop2065R Appellant .. Respondent Appellant By : Ms.Neelam C Jadav.Ar Respondent By : Mr.Tejinder Pal Singh.Dr Date Of Hearing 08.09.2022 Date Of Pronouncement 12.09.2022 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Assessee Has Filed The Appeal Against The Order Of The Cit(A)- National Faceless Appeal Centre (Nfac), Delhi Passed U/S 144 & 250 Of The Act. The Assessee Has Raised The Following Grounds Of Appeal:

For Appellant: Ms.Neelam C Jadav.ARFor Respondent: Mr.Tejinder Pal Singh.DR

Section 133(6)Section 142(1)Section 144Section 148

issued notice u/s 142(1) of the Act and there was no compliance to the notice. Therefore the A.O. has reason to believe that the income has escaped assessment and has issued notice u/s 148 of the Act and served by way of affixture. Further the A.O. has issued

Sabari Foundations P Ltd., Chennai vs. ITO Corporate Ward 6(1), Chennai

In the result, the appeal of the Assessee in I

ITA 2744/CHNY/2017[2010-11]Status: DisposedITAT Chennai09 Sept 2022AY 2010-11

Bench: Shri Mahavir Singhand Shri Manoj Kumar Aggarwalआयकर अपील सं./I.T.A No.:2744/Chny/2017 िनधा"रण वष"/ Assessment Year 2010 - 2011

For Appellant: Mr. N. Arjun Raj, AdvocateFor Respondent: Mr. P. Sajit Kumar, JCIT

Section 143(3)Section 147Section 148

assess income on the basis of the same materials that were available with the authority as part of the record. 11. The phrase ‘reason to believe’ in Section 147 relates to such other new or tangible material as may have come to the knowledge of the Assessing Officer pursuant