“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

Ashvinbhai Bhavanbhai Kyada, Rajkot vs. Assistant Commissioner, Income Tax

In the result, the appeal (ITA No

ITA 729/RJT/2024[2012-13]Status: DisposedITAT Rajkot21 May 2025AY 2012-13

Bench: Dr. Arjun Lal Saini & Shri Dinesh Mohan Sinhaआयकरअपीलसं./Ita Nos.729/Rjt/2024 ("नधा"रणवष" /Assessment Years: (2012-13) Ashvinbhai Bhavanbhai Assistant Commissioner, Kyada Income Tax, Circle – 2(2)(1), Vs. Nr. Pitroda Nivas, Opp. Rajkot - 360005 Sadguru Jyot Complex, Pedak Road, Rajkot – 360003 "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Aitpk7924Q (अपीलाथ" /Appellant) (""यथ" /Respondent)

For Appellant: Shri Darshan Rakholiya, Ld. ARFor Respondent: Shri Abhimanyu Singh Yadav, Ld. Sr. DR

Section 139Section 143(3)Section 147Section 148

That, the learned Assessing Officer has erred in invoking Section 147 merely relying upon borrowed satisfaction and also failed to justify the expression "reasons to believe" whereby the reasons recorded must demonstrate link between tangible material and formation of reason to believe that income had escaped assessment. Further, the ruling ... reopening proceedings of assessment are without independent inquiry, that reopening of assessment also upon borrowed satisfaction and also failed to justify the expression “reasons to believe” that income had escaped assessment. No, tangible link between materials to believe that income escaped between the assessment. We note that the no opportunity

Balithal Gram Seva Sahakari Samiti Limited, Tonk vs. Rjn-W-(107)(5), Tonk

In the result, the appeal of the assessee is allowed

ITA 1306/JPR/2024[2019-20]Status: DisposedITAT Jaipur21 May 2025AY 2019-20

Bench: Dr. S. Seethalakshmi & Shri Gagan Goyalbalithal Gram Seva Sahakari Samiti Limited, Balithal Uniara Tonk, 304024 Pan No.: Aabab4614R ...... Appellant Vs.

For Appellant: Mr. Hemang Gargieya, Adv., Ld. ARFor Respondent: Mr. Gautam Singh Choudhary, Addl. CIT, Ld. Sr. DR

Section 139Section 139(1)Section 147Section 148Section 148ASection 234ASection 234FSection 250Section 80P

four years but within a period of eight years from the end of the relevant year, viz., (1) the ITO must have reason to believe that income chargeable to tax has escaped assessment, and (2) he must have reason to believe that such income has escaped assessment by reason ... existence of the belief can be challenged by the assessee but not the sufficiency of the reasons for the belief. The expression "reason to believe" does not mean a purely subjective satisfaction on the part of the ITO. The reason must be held in good faith. It cannot be merely

M/S. Bna Commerce Pvt. Ltd., Kolkata vs. ITO, Ward 5(1), Kolkata

In the result, the appeal of the assessee is allowed

ITA 155/KOL/2025[2014-15]Status: DisposedITAT Kolkata21 May 2025AY 2014-15

Bench: Shri Rajesh Kumar, Am & Shri Sonjoy Sarma, Jm

For Appellant: Shri Sunil Surana, FCAFor Respondent: Shri Ankur Goyal, DR

Section 132Section 143(3)Section 144BSection 147Section 148

Rs.38,00,000/- from M/s. Pearltree Dealmark Pvt. Ltd. managed and controlled by Shri Dilip Kumar Gupta. Under the circumstances, I have reason to believe that the above income of the assessee has escaped assessment within the meaning of provisions of sec. 147 of the I.T. Act, 1961." 06. Therefore ... assessee was reopened u/s 147 of the Act by issue of notice u/s 148 of the Act on 30.03.2020 after recording the reasons to believe u/s 148(2) of the Act. Thereafter, the assessee complied with the said notice by fling the return of income

M/S. Bna Commerce Pvt. Ltd., Kolkata vs. ITO, Ward 5(1), Kolkata

In the result, the appeal of the assessee is allowed

ITA 154/KOL/2025[2013-14]Status: DisposedITAT Kolkata21 May 2025AY 2013-14

Bench: Shri Rajesh Kumar, Am & Shri Sonjoy Sarma, Jm

For Appellant: Shri Sunil Surana, FCAFor Respondent: Shri Ankur Goyal, DR

Section 132Section 143(3)Section 144BSection 147Section 148

Rs.38,00,000/- from M/s. Pearltree Dealmark Pvt. Ltd. managed and controlled by Shri Dilip Kumar Gupta. Under the circumstances, I have reason to believe that the above income of the assessee has escaped assessment within the meaning of provisions ... assessee was reopened u/s 147 of the Act by issue of notice u/s 148 of the Act on 30.03.2020 after recording the reasons to believe u/s 148(2) of the Act. Thereafter, the assessee complied with the said notice by fling the return of income

O.K. Auto Components Pvt Ltd, Haryana vs. DCIT Circle-1, Haryana

In the result, the appeal filed by the assesee stand allowed

ITA 5358/DEL/2024[2013-14]Status: DisposedITAT Delhi21 May 2025AY 2013-14

Bench: Shri Shamim Yahya & Shri Vimal Kumarm/S O.K. Auto Components Vs. Dcit, Circle-1, (P) Ltd., Haryana A-131, Sgm Nagar, Faridabad Haryana – 121001 (Pan: Aaac05770E) (Appellant) (Respondent)

For Appellant: Shri Vijay Kumar Singla, CAFor Respondent: Sh. Choudhary N.C. Roy, Sr. DR

Section 133ASection 142(1)Section 143(3)Section 147Section 148ASection 68

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 ... materials facts necessary for his assessment for the assessment 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 above have carefully considered the assessment records containing the submissions made by the assessee

Nakul Singh, Uttar Pradesh vs. ITO, Ward -2(2)(5), Uttar Pradesh

The appeal of the assessee is allowed

ITA 5323/DEL/2024[2012-13]Status: DisposedITAT Delhi21 May 2025AY 2012-13

Bench: Ms. Madhumita Roynakul Singh Vs. Ito, Ward 2(2)(5) House No. 100, Penga-1, House No. 100, Penga-1 Penga Modinagar, Penga Modinagar Dist. Ghaziabad Dist. Ghaziabad Uttar Pradesh – 201204 Uttar Pradesh – 201204 "थायीलेखासं./जीआइआरसं./Pan/Gir No:Dqmps3893G Appellant .. Respondent

For Appellant: Sh. Shantanu Kanungo, Adv &For Respondent: Sh. Sanjay Kumar, Sr. DR

Section 133(6)Section 143(2)Section 144Section 148

Rs.64,00,00,000/- was taken as capital gain income on the sale of the said properties found to have been undisclosed and reason to believe of escaping assessment to the tune of Rs.64,00,00,000/- was made and proceeding under 147 of the Act was initiated

Chetan Prabhakar, New Delhi vs. ITO Ward 41(5), New Delhi

In the result, impugned order is set aside and appeal of the assessee is allowed

ITA 3194/DEL/2024[2010-11]Status: DisposedITAT Delhi21 May 2025AY 2010-11

Bench: SHRI VIKAS AWASTHY (Judicial Member)

For Appellant: Shri Abhishek Jain, Chartered Accountant and Ms. Sunidi Sharma, AdvocateFor Respondent: Shri Manoj Kumar, Sr. DR

Section 139(1)Section 148Section 151

Income Tax Return for A.Y. 2010-11. As such cash of Rs. 21,50,000/- remains unexplained. Under such a situation I have reason to believe that income at least to the extent of Rs. 21,50,000/- has escaped assessment in the hands of assessee within the meaning ... such cash of Rs.21,50,000/- deposited in the bank account remains unexplained. Under such situation the AO has reason to believe that income to the extent of Rs.21,50,000/- has escaped assessment. The assessee has placed on record a copy of acknowledgment of return of income

Vinod Kohli, Gurgaon vs. ACIT Circle 35(1), New Delhi

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

ITA 896/DEL/2021[2012 - 2013]Status: DisposedITAT Delhi21 May 2025

Bench: Shri S. Rifaur Rahman

For Appellant: Ms. Monalisa Maity, AdvocateFor Respondent: Shri Sanjay Kumar, Sr. DR

Section 148Section 148(2)Section 292B

clothes the AO with jurisdiction to reopen an assessment on satisfaction of the following: (a) The AO must have reason to believe that (b) Income chargeable to tax has escaped the assessment and (c) In cases where the assessment sought to be reopened is beyond the period of four years ... Sec.147 of the Act, no action for initiation of reassessment proceedings for A.Y. 2011-12 could have been taken unless the AO had reason to believe that income chargeable to tax had escaped the assessment for a reason of failure on the part of assessee to disclose fully and truly

Shri Jainarayan Hariram Goel Charitable Trust, Raipur vs. Deputy Commissioner of Income Tax (Exemption), Bhopal

Appeal is dismissed as withdrawn

ITA 190/RPR/2025[2011-12]Status: DisposedITAT Raipur20 May 2025AY 2011-12

Bench: Shri Partha Sarathi Chaudhury, Jm & Shri Arun Khodpia, Am आयकर अपील सं. / Ita No: 190/Rpr/2025 (िनधा"रण वष" Assessment Year: 2011-12)

For Appellant: None (VSVS Application)For Respondent: Dr. Priyanka Patel, Sr. DR

Section 12ASection 147Section 250Section 68

Learned Assessing Officer ('AO'), wherein the Assessing Officer has incorrectly initiated the re-assessment proceedings for the second time without a valid reason to believe. The reopening of the assessment without a legitimate reason to believe is contrary to the provisions of the law and, as such, the re-assessment ... erred by passing the order without providing the copies of document/enquiry report on which the AO has relied upon while forming the reason to believe and thus has violated the principal of natural justice. Any order passed against the principal of natural justice

Tangudu Ananda Rao, Srikakulam vs. Income-Tax Officer, Ward-1, Srikakulam

In the result, appeal of the assessee is allowed

ITA 182/VIZ/2025[2017-18]Status: DisposedITAT Visakhapatnam20 May 2025AY 2017-18

Bench: Shri Vijay Pal Rao, Hon’Ble & Shri S Balakrishnan, Hon’Bleआयकर अपील सं./ I.T.A. No. 182/Viz/2025 (धनिाारण िर्ा / Assessment Year: 2017-18) Tangudu Ananda Rao, Vs. Income Tax Officer, Srikakulam. Ward-1, Pan: Abipt5195K Srikakulam. (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent) अपीलार्थी की ओर से/ Assessee By : Sri I. Kama Sastry, Ca प्रत्यार्थी की ओर से / Revenue By : Dr. Aparna Villuri, Sr. Ar सुनिाई की तारीख / Date Of Hearing : 29/04/2025 घोर्णा की तारीख/Date Of : 20/05/2025 Pronouncement O R D E R

For Appellant: Sri I. Kama Sastry, CAFor Respondent: Dr. Aparna Villuri, Sr. AR

Section 133(6)Section 142(1)Section 143(2)Section 143(3)Section 69A

more than the closing cash balance as on 31st March 2016 in the return for AY 2016-17. However, if the AO has reason to believe that the closing cash balance as on 31st March, 2016 has been increased by revising the return or backdating transactions in the books

Sita Rama Raju Sagi, Bhimavaram vs. ITO Ward 1 Bhimavaram, Bhimavaram

In the result, appeal of the assessee is allowed

ITA 154/VIZ/2025[2020-21]Status: DisposedITAT Visakhapatnam20 May 2025AY 2020-21

Bench: Shri Vijay Pal Rao, Hon’Ble & Shri S Balakrishnan, Hon’Bleआयकर अपील सं./ I.T.A. No.154/Viz/2025 (धनिाारण िर्ा / Assessment Year : 2020-21) Sita Rama Raju Sagi, Vs. Income Tax Officer, Bhimavaram – 534202. Ward-1, Pan: Egapa3925J Bhimavaram. (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent) अपीलार्थी की ओर से/ Assessee By : Mrs. Hema Latha K, Ca प्रत्यार्थी की ओर से / Revenue By : Dr. Satyasai Rath, Cit-Dr सुनिाई की तारीख / Date Of Hearing : 30/04/2025 घोर्णा की तारीख/Date Of : 20/05/2025 Pronouncement O R D E R

For Appellant: Mrs. Hema Latha K, CAFor Respondent: Dr. Satyasai Rath, CIT-DR

Section 143(2)Section 143(3)Section 263Section 44A

limited scrutiny has been initiated it cannot be termed as inadequate or improper enquiry by the Ld. AO. Thus, there is no reason to believe that the Ld. AO did not examine the issue at the assessment stage. Since the scrutiny was based on the sole reason for examining

Aksh Optifibre Limited, New Delhi vs. ACIT, Circle - 2, Alwar

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

ITA 170/JPR/2024[2010-11]Status: DisposedITAT Jaipur20 May 2025AY 2010-11

For Appellant: Shri Akul Agarwal, C.A. (thr. V.C.)For Respondent: Shri Arvind Kumar, CIT-DR

Section 143(3)Section 147Section 148Section 156Section 234ASection 250

merit. 7.7 Appellant had further contested the validity of proceedings u/s 148 that the initiation of assessment proceedings was without any valid "reason to believe that the income has escaped assessment. Appellant has submitted that reassessment is bad in law as it was based on 'change of opinion' I have

DCIT, Circle-2(1)(1), Ahmedabad vs. Navnirman Co Op. Bank Ltd, Ahmedabad

In the result, the appeal of the Revenue is hereby dismissed

ITA 1974/AHD/2024[2017-18]Status: DisposedITAT Ahmedabad20 May 2025AY 2017-18

Bench: Shri Sanjay Garg & Shri Narendra Prasad Sinhaआयकर अपील सं /Ita No.1974/Ahd/2024 िनधा"रण वष" /Assessment Year : 2017-18 The Dcit Navnirman Co-Op. Bank Ltd. बनाम/ Circle-2(1)(1) Navnirman Bhawan V/S. Ahmedabad – 380 015 Opp. Hdfc Bank Ahmedabad City Ahmedabad – 380 009 "थायी लेखा सं./Pan: Aabfn 2975 L (अपीलाथ'/ Appellant) (!( यथ'/ Respondent) Assessee By : Shri Hem Chhajed, Ar Revenue By : Shri C. Dharani Nath, Sr.Dr सुनवाई की तारीख/Date Of Hearing : 13/05/2025 घोषणा की तारीख /Date Of Pronouncement: 20/05/2025

For Appellant: Shri Hem Chhajed, ARFor Respondent: Shri C. Dharani Nath, Sr.DR

Section 143(2)Section 147Section 148Section 68

from assessee/other related parties. Thereafter, on the basis of above, AO will summarise his findings and will come to ‘basis of reasons to believe’. The AO is expected to draw ‘nexus’ between his findings and reasons to believe. It appears from the reasons recorded that Ld.AO has not analyzed ... Bank is beneficiary or only banking channel through which transactions are carried out between two parties. There is no nexus between findings and reason to believe. Ld. AO failed to analyze and establish live link between information and reasons involving to appellant. The onus is on the AO to establish

Jigneshkumar Jivrajbhai Patel, Ahmedabad vs. National Faceless Assessment Centre (NFAC), Delhi Present Jurisdiction the ITO, Ward-7(2)(1), Ahmedabad

In the result, all the captioned three appeals of the assessee are hereby allowed

ITA 1624/AHD/2024[2016-17]Status: DisposedITAT Ahmedabad20 May 2025AY 2016-17

Bench: Shri Sanjay Garg & Shri Narendra Prasad Sinha1. आयकर अपील सं /Ita No.1622/Ahd/2024 – Asst.Year 2013-14 2. आयकर अपील सं /Ita No.1623/Ahd/2024 – Asst.Year 2015-16 3. आयकर अपील सं /Ita No.1624/Ahd/2024 – Asst.Year 2016-17

For Appellant: Shri Biren Shah, ARFor Respondent: Shri Amit Pratap Singh, Sr.DR

Section 143(1)(a)Section 148Section 148ASection 250

amount of Rs 1,81,75,577/- for taxation 6. In view, of the above facts narrated in above paras, I have reason to believe that income upto the extent of Rs.1,61,75,577/- which is chargeable to tax, has escaped assessment for the A.Y. 2013-14. within ... undertaken unexplained credits in his bank account of Rs.1,61,75,577/-, which were received from Kiran Gems Pvt.Ltd. The AO formed his reasons to believe that the income of the assessee has escaped assessment only on the basis of above information, without verifying as to whether the assessee

Jigneshkumar Jivrajbhai Patel, Ahmedabad vs. National Faceless Assessment Centre(NFAC), Delhi Present Jurisdiction the ITO, Ward-7(2)(1), Ahmedabad

In the result, all the captioned three appeals of the assessee are hereby allowed

ITA 1623/AHD/2024[2015-16]Status: DisposedITAT Ahmedabad20 May 2025AY 2015-16

For Appellant: Shri Biren Shah, ARFor Respondent: Shri Amit Pratap Singh, Sr.DR

Section 143(1)(a)Section 148Section 148ASection 250

Jigneshkumar Jivrajbhai Patel, Ahmedabad vs. National Faceless Assessment Centre, Delhi Present Jurisdiction : the ITO, Ward-7(2)1), Ahmedabad

In the result, all the captioned three appeals of the assessee are hereby allowed

ITA 1622/AHD/2024[2013-14]Status: DisposedITAT Ahmedabad20 May 2025AY 2013-14

For Appellant: Shri Biren Shah, ARFor Respondent: Shri Amit Pratap Singh, Sr.DR

Section 143(1)(a)Section 148Section 148ASection 250

ACIT Cental Circle 8(2) Mumbai, Mumbai vs. Subhkam Ventures (I) Private Limited, Mumbai

Appeals of the revenue are dismissed and the C

ITA 5657/MUM/2024[2015-16]Status: DisposedITAT Mumbai20 May 2025AY 2015-16

Bench: Shri Anikesh Banerjee, Jm & Ms Padmavathy S, Am

For Respondent: Shri Mahendra Bishnoi

Section 10(35)Section 132Section 250Section 94(7)

mere pretence. The powers of the ITO to reopen assessment though wide are not plenary. The words of the statute are reason to believe and not reason to suspect. The reopening of the assessment after the lapse of many years is a serious matter. The Act, no doubt, contemplates

ACIT Central Circle 8(2) Mumbai, Mumbai vs. Subhkam Ventures (I) Private Limited, Mumbai

Appeals of the revenue are dismissed and the C

ITA 5622/MUM/2024[2018-19]Status: DisposedITAT Mumbai20 May 2025AY 2018-19

Bench: Shri Anikesh Banerjee, Jm & Ms Padmavathy S, Am

For Respondent: Shri Mahendra Bishnoi

Section 10(35)Section 132Section 250Section 94(7)

ACIT Central Circle 8(2) Mumbai, Mumbai vs. Subhkam Ventures (I) Private Limited, Mumbai

Appeals of the revenue are dismissed and the C

ITA 5620/MUM/2024[2016-17]Status: DisposedITAT Mumbai20 May 2025AY 2016-17

Bench: Shri Anikesh Banerjee, Jm & Ms Padmavathy S, Am

For Respondent: Shri Mahendra Bishnoi

Section 10(35)Section 132Section 250Section 94(7)

Saurashtra Gramin Bank, Rajkot vs. Assistat Commissioner of Income Tax NFAC, National Faceless Assessment Centre Delhi

In the result, the appeal of the assessee is allowed

ITA 183/RJT/2024[2014-15]Status: DisposedITAT Rajkot19 May 2025AY 2014-15

Bench: Dr. Arjun Lal Saini & Shri Dinesh Mohan Sinha

For Appellant: Ms. A.D. Vyas, ARFor Respondent: Shri Sanjay Punglia, CIT-DR

Section 143(3)Section 147Section 148Section 250Section 36(1)(viia)

respect of allowance of the provision of bad and doubtful debts u/s 36(1)(viia) has remained unexplained. I have, therefore reason to believe that as above discussion Rs.5,23,94,935/- (Rs.448.09 lacs + Rs.75,85,935/-) has escaped assessment within the meaning of section ... officer, sufficient details were not furnished by the assessee, therefore as discussed in details in the reasons for reopening, the assessing officer had reason to believe that the assessee has claimed excess provision for Bad and doubtful debts amounting to Rs. 75,85,935/-. In view of the above