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“escapement of income”

ReassessmentSection 147Section 1473,765 judgments

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

Leading authorities on escapement of income

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.

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.

CIT v. Sun Engineering Works (P) Ltd.
198 ITR 297 · 1992 · Supreme Court
814
citing judgments

A court's pronouncement derives its scope and color from the specific questions involved in the case, thus, due regard must always be given to the questions framed before the court when interpreting its judgment.

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.

Hindustan Lever Ltd. v. R.B. Wadkar
268 ITR 332 · 2004 · High Court
695
citing judgments

The validity of reassessment proceedings initiated under Section 147, by issuing a notice under Section 148, must be judged solely on the reasons originally recorded by the Assessing Officer. These recorded reasons cannot be supplemented, improved upon, or modified at any later stage.

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.

Judgments citing escapement of income

Amrik Singh So Ujjagar Singh Vill Koolhi Khura, Po Lehal Nr Punjab Mata Nagar Ludhiana, Ludhiana, Punjab vs. Income Tax Officer Ward-1(2), Ludhiana Jurisdiction Officer Ward 3(1), Ludhiana, Punjab

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

ITA 792/CHANDI/2024[2011-2012]Status: DisposedITAT Chandigarh23 Dec 2024AY 2011-2012

Bench: SHRI. VIKRAM SINGH YADAV (Accountant Member), SHRI. PARESH M. JOSHI (Judicial Member)

For Appellant: Shri Sudhir Sehgal, AdvocateFor Respondent: Shri Vivek Vardhan, JCIT, Sr. DR
Section 144Section 148Section 69A

believe, which was formed by the Assessing Officer in, as much as, in the reasons so recorded, it has been mentioned that the escapement of income is on account of deposit in the bank account to the tune of Rs. 22,00,500/-, instead of correct amount ... failed to appreciate that even the PCIT has accorded wrong sanction with regard to approval for issuance of notice u/s 148 on the escapement of income at Rs. 22,00,500/-, without any application of mind. 4. That the approval as given by the Ld. PCIT for giving sanction

Savitri Devi Agrawal, Kolkata vs. ITO, Ward 63(4), Kolkata

In the result, appeal of the assessee stands allowed

ITA 765/KOL/2024[2010-11]Status: DisposedITAT Kolkata23 Dec 2024AY 2010-11

Bench: Shri Sanjay Garg

Section 250

supposed to co-relate the said information with the accounts of the assessee and thereafter, he was supposed to form the belief regarding escapement of income, if any, of the assessee. The Ld. AO, in this case, on receipt of alleged information without application of mind, straightaway reopened the assessment ... belief formed by the AO in this case of escapement of income was not based on any reliable material and the mere uncorroborated information received by the AO would not constitute a valid reason to form the belief of escapement of income. 7. It has been held time and again

Deputy Commissioner of Income Tax, Central Circle - 4(1), Kolkata, Income Tax Kolkata vs. Lakhotia Transport Co. Private Limited, Kolkata

In the result, both the appeals of the Revenue are dismissed and the Cross Objections of the assessee are allowed

ITA 1699/KOL/2024[2015]Status: DisposedITAT Kolkata20 Dec 2024

Bench: Shri Rajesh Kumar, Am & Shri Pradip Kumar Choubey, Jm

For Appellant: Shri Sunil Surana, ARFor Respondent: Shri Sailen Samadder, DR
Section 1Section 143(1)Section 143(3)Section 147Section 148Section 151(1)Section 151(2)Section 68

assessee to disclose any information truly and materially during the assessment proceedings or in the return of income which led to escapement of income in that particular assessment year. In the present case, though the ld. AO mentioned that there was failure on the part of the assessee

Deputy Commissioner of Income Tax, C.C. - 4(1), Income Tax, Kolkata vs. Lakhotia Transport Co. Private Limited, Kolkata

In the result, both the appeals of the Revenue are dismissed and the Cross Objections of the assessee are allowed

ITA 1698/KOL/2024[2013]Status: DisposedITAT Kolkata20 Dec 2024

Bench: Shri Rajesh Kumar, Am & Shri Pradip Kumar Choubey, Jm

For Appellant: Shri Sunil Surana, ARFor Respondent: Shri Sailen Samadder, DR
Section 1Section 143(1)Section 143(3)Section 147Section 148Section 151(1)Section 151(2)Section 68

assessee to disclose any information truly and materially during the assessment proceedings or in the return of income which led to escapement of income in that particular assessment year. In the present case, though the ld. AO mentioned that there was failure on the part of the assessee

M/S. Toyota Kirloskar Motor Pvt Ltd, Bengaluru vs. Assistant Commissioner of Income Tax, Ltu, Circle-1, Bengaluru

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

ITA 1333/BANG/2024[2011-12]Status: DisposedITAT Bangalore20 Dec 2024AY 2011-12

Bench: Shri Laxmi Prasad Sahu & Shri Keshav Dubeyassessment Year: 2011-12 M/S. Toyota Kirloskar Motor Pvt. Ltd. Plot No.1, Bidadi Industrial Area So Bidadi Acit Vs. Ramanagar Ltu, Circle-1 Bengaluru 562 109 Banalore Pan No : Aaact5415B Appellant Respondent Appellant By : Sri Padam Chand Kincha, A.R. Respondent By : Smt. Kumutha D., D.R. Date Of Hearing : 24.09.2024 Date Of Pronouncement : 20.12.2024

For Appellant: Sri Padam Chand Kincha, A.RFor Respondent: Smt. Kumutha D., D.R
Section 143(1)Section 143(3)Section 147Section 148Section 234BSection 234B(3)Section 250

April, 1989, Assessing Officer has power to re-open, provided there is "tangible material" to come to the conclusion that there is escapement of income from assessment. Reasons must have a live link with the formation of the belief. Our view gets support from the changes made to Section

DCIT Circle- 15(1)(2), Mumbai vs. Hrel Real Estate Ltd, Mumbai

In the result, all the three appeals of the Revenue as well as In the result, all the three appeals of the Revenue as well as cross-objection of the assessee are dismissed

ITA 2837/MUM/2024[2013-14]Status: DisposedITAT Mumbai20 Dec 2024AY 2013-14

Bench: Shri Om Prakash Kant () & Shri Raj Kumar Chauhan ()

For Appellant: Mr. Biswanath Das, CIT-DRFor Respondent: Ms. Priyanka Jain

that the appellant had incorrectly claimed the expenditures ief that the appellant had incorrectly claimed the expenditures without commencement of business leading to escapement of income for commencement of business leading to escapement of income for commencement of business leading to escapement of income for AY.2012-13. What 13. What

DCIT Circle- 15(1)(2), Mumbai vs. Hrel Real Estate Ltd, Mumbai

In the result, all the three appeals of the Revenue as well as In the result, all the three appeals of the Revenue as well as cross-objection of the assessee are dismissed

ITA 2825/MUM/2024[2014-15]Status: DisposedITAT Mumbai20 Dec 2024AY 2014-15

Bench: Shri Om Prakash Kant () & Shri Raj Kumar Chauhan ()

For Appellant: Mr. Biswanath Das, CIT-DRFor Respondent: Ms. Priyanka Jain

that the appellant had incorrectly claimed the expenditures ief that the appellant had incorrectly claimed the expenditures without commencement of business leading to escapement of income for commencement of business leading to escapement of income for commencement of business leading to escapement of income for AY.2012-13. What 13. What

DCIT, Central Circle- 4(1), Mumbai vs. Kanakia Spaces Realty Pvt. Ltd., Mumbai

In the result, appeal of the revenue is dismissed and cross-

ITA 1639/MUM/2024[2011-12]Status: DisposedITAT Mumbai20 Dec 2024AY 2011-12

Bench: Shri Narendra Kumar Billaiya, Hon’Ble

For Appellant: Shri Vijay Mehta, A/RFor Respondent: Shri Biswanath Das, CIT, D/R
Section 143(3)Section 148Section 35A

purchases in its books, through such bogus bills. The inflation of purchases has therefore led reduction in profits and has led to the escapements of income to the above extent. ‘Therefore, there is a reason to believe that the income chargeable to tax to the extent of Rs.13 ... initiation stage, what is required to the Assessing Officer for reopening the case is reason to believe, but not the established fact of escapement of income. At the stage of issue of notice, the only question is whether there was relevant material on record which a reasonable person could have

Pankaj Chandrakant Pimple, Borivali (West), Mumbai vs. Int Tax Ward 3(3)(1), Mumbai

ITA 1577/MUM/2024[2017-18]Status: DisposedITAT Mumbai20 Dec 2024AY 2017-18

Bench: Ms. Kavitha Rajagopal, Jm & Smt. Renu Jauhri, Am

Section 143(2)Section 144Section 144C(1)Section 148Section 148ASection 151Section 56Section 56(2)Section 69

IN THE INCOME TAX APPELLATE TRIBUNAL “I” BENCH, MUMBAI BEFORE MS. KAVITHA RAJAGOPAL, JM AND SMT. RENU JAUHRI, AM ITA

DCIT, Circle-15(1)(2), Mumbai, Aayakar Bhavan, Churchgarte vs. Hrel Real Estate Ltd, Hincon House, Vikhroli West

In the result, all the three appeals of the Revenue as well as In the result, all the three appeals of the Revenue as well as cross-objection of the assessee are dismissed

ITA 1531/MUM/2024[2012]Status: DisposedITAT Mumbai20 Dec 2024

Bench: Shri Om Prakash Kant () & Shri Raj Kumar Chauhan ()

For Appellant: Mr. Biswanath Das, CIT-DRFor Respondent: Ms. Priyanka Jain

that the appellant had incorrectly claimed the expenditures ief that the appellant had incorrectly claimed the expenditures without commencement of business leading to escapement of income for commencement of business leading to escapement of income for commencement of business leading to escapement of income for AY.2012-13. What 13. What

ACIT - 14(1)(2), Mumbai vs. D Thakkar Developers Pvt. Ltd., Mumbai

In the result, both the appeals are partly allowed for statistical purposes

ITA 3477/MUM/2023[2014-15]Status: DisposedITAT Mumbai20 Dec 2024AY 2014-15

Bench: Smt. Beena Pillai & Smt. Renu Jauhrid Thakkar Developers Pvt. V/S. Dcit 14(1)(2), Mumbai Ltd. बनाम Aayakar Bhavan, D1 & D2, 4Th Floor, Court Churchgate, Mumbai Chambers, Vitthaldas Maharashtra-400020 Thackersey Marg, 35 New Marine Lines, Marine Lines, Maharashtra-400020 स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aadcp6396E Appellant/अपीलार्थी .. Respondent/प्रतिवादी Acit 14(1)(2), Mumbai V/S. D Thakkar Developers Pvt. Room No. 455, 4Th Floor, बनाम Ltd. Aayakar Bhavan, M K. 1105/1106, Universal Road, Mumbai Magestic, Behind Rbk Maharashtra-400020 International School, P. L. Lokhande, Marg, Chembur West, Mumbai-400043 स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aadcp6396E Appellant/अपीलार्थी .. Respondent/प्रतिवादी

For Appellant: Shri Kirith ShethFor Respondent: Shri R. R. Makwana
Section 143Section 143(3)Section 148Section 250Section 263Section 35Section 35(1)Section 35(1)(ii)Section 35(1)(vii)

subsequently withdrawn. Thus, withdrawal of approval can not be considered as a fresh tangible material for formation of opinion, as regards the escapement of income, before the issue of notice u/s. 148. Even otherwise, withdrawal notification was issued prior to the completion of original assessment vide order

D Thakkar Developers Private Limited, Mumbai vs. Deputy Commissioner of Income Tax 14(1)(2), Mumbai

In the result, both the appeals are partly allowed for statistical purposes

ITA 2975/MUM/2023[2014-15]Status: DisposedITAT Mumbai20 Dec 2024AY 2014-15

Bench: Smt. Beena Pillai

For Respondent: Shri R. R. Makwana
Section 143Section 143(3)Section 148Section 250Section 263Section 35Section 35(1)Section 35(1)(ii)Section 35(1)(vii)

subsequently withdrawn. Thus, withdrawal of approval can not be considered as a fresh tangible material for formation of opinion, as regards the escapement of income, before the issue of notice u/s. 148. Even otherwise, withdrawal notification was issued prior to the completion of original assessment vide order

B.R. Gopi, HUF, Thanjavur vs. ITO, Ward-1, Thanjavur

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

ITA 2628/CHNY/2024[2017-18]Status: DisposedITAT Chennai19 Dec 2024AY 2017-18

Bench: Hon’Ble Shri Manoj Kumar Aggarwal & Hon’Ble Shri Manu Kumar Giriआयकरअपील सं./ Ita No.2628/Chny/2024 (िनधा"रणवष" / Assessment Year: 2017-2018) B. R. Gopi (Huf) Vs. The Income Tax Officer, 1081C, Mission Street, Ward 1, M. Chavady, Thanjavur Thanjavur 613 001. [Pan: Aaihb 1928G] (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से/ Appellant By : Shri. N. Arjun Raj, Advocate ""यथ" क" ओर से /Respondent By : Ms. D. Komali Krishna, Irs, Cit. सुनवाई क" तार"ख/Date Of Hearing : 17.12.2024 घोषणा क" तार"ख /Date Of Pronouncement : 19.12.2024 आदेश / O R D E R Per Manu Kumar Giri ()

For Appellant: Shri. N. Arjun Raj, AdvocateFor Respondent: Ms. D. Komali Krishna, IRS, CIT
Section 139(1)Section 142(1)Section 144Section 69A

bank account(s) during the demonetisation period (9th November, 2016 to 30th December, 2016). The AO was of the opinion that there was escapement of income to the tune of Rs. 13,64,350/-. The case was then re-opened with a reason for Huge Cash deposit. During the assessment

Insurance Brokers Association of India, Mumbai vs. Income Tax Officer (Exemption) Ward-1(3), Mumbai

In the result, both the appeals filed by the assessee stands partly allowed

ITA 3957/MUM/2024[2011-12]Status: DisposedITAT Mumbai19 Dec 2024AY 2011-12

Bench: Hon’Ble Shri Sandeep Gosain

Section 11Section 2(15)Section 250

been initiated with a view to make further enquiries or investigate the facts or make roving enquiries, without formation of the belief of escapement of income 4. The learned Commissioner (Appeals) ought to have appreciated that the Assessing Officer had failed to arrive at a subjective satisfaction that income

Insurance Brokers Association of India, Mumbai vs. Income Tax Officer (Exemption ) Ward -1(3), Mumbai

In the result, both the appeals filed by the assessee stands partly allowed

ITA 3956/MUM/2024[2012-13]Status: DisposedITAT Mumbai19 Dec 2024AY 2012-13

Bench: Hon’Ble Shri Sandeep Gosain

Section 11Section 2(15)Section 250

been initiated with a view to make further enquiries or investigate the facts or make roving enquiries, without formation of the belief of escapement of income 4. The learned Commissioner (Appeals) ought to have appreciated that the Assessing Officer had failed to arrive at a subjective satisfaction that income

Jagjit Singh, Patiala vs. Income Tax Officer, Ward-2, Patiala

In the result we set aside the impugned order and remand the case back to the file of Ld

ITA 105/CHANDI/2024[2011-12]Status: DisposedITAT Chandigarh18 Dec 2024AY 2011-12

Bench: This Tribunal. The Assessee Is Aggrieved By The Order Bearing No. Itba/Nfac/S/250/2023- 24/1058720011(1) Dt. 13/12/2023 Of The Ld. Cit(A) Passed Under Section 250 Of The Act Which Is Hereinafter Referred To As The “Impugned Order”. The Relevant Assessment Year Is 2011-12 & The Corresponding Previous Year Period Is From 01/04/2010 To 31/03/2011. 2. Factual Matrix

For Appellant: Shri Tejmohan Singh, AdvocateFor Respondent: Shri Vivek Vardhan, JCIT, Sr. DR
Section 142(1)Section 144Section 147Section 148Section 17Section 22Section 250Section 253

upholding the assessment framed by the Assessing Officer in as much as there has been no reason to believe that there was an escapement of income in as much as the reasons recorded are based only on borrowed information, incorrect facts and conjectures as such the order passed is illegal

Amit Khatri, Sonipat vs. ITO, Ward 1, Sonipat

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

ITA 2430/DEL/2023[2012-13]Status: DisposedITAT Delhi18 Dec 2024AY 2012-13

Bench: Shri Challa Nagendra Prasadआ.अ.सं/.I.T.A No.2430/Del/2023 िनधा"रणवष"/Assessment Year: 2012-13 बनाम Amit Khatri Income Tax Officer Ward No.30, Garhi Bhraman, Vs. Ward-1, Sonipat, Haryana. Sonipat, Haryana. Pan No. Bdspk3438G अपीलाथ" Appellant ""यथ"/Respondent

Section 147Section 148Section 151

page 27 and para 21 at page 31 also which led the AO to form a prima facie view of escapement of income chargeable to tax. 5. From these discussions, it is evident that the AO had no material to initiate action u/s 147 except for the material relating

DCIT, CC-1(3), Kolkata vs. Raic Integrated Sponge and Power Pvt. Ltd., Kolkata

In the result, the appeal of the revenue is dismissed

ITA 863/KOL/2024[2011-12]Status: DisposedITAT Kolkata17 Dec 2024AY 2011-12

Bench: Shri Rajesh Kumar&Shri Pradip Kumar Choubey]

Section 142(1)Section 147Section 148Section 2(24)(x)Section 68

already considered the entire receipt from M/s Shroff Tradelink Pvt. Ltd. in its books of account. Thus, in our view there is no escapement of income. We have gone through the operative portion of the Ld. CIT(A) which according to us it is essential to reproduce herein below ... books of accounts. Further, these receipts have been accounted as revenue receipts in the Proft and loss account. Thus, there is no escapement of income by non-reporting, under-reporting or mis-reporting of receipts from M/s Shroff Tradelink Pvt. Ltd. AO has held the profit earned in commodity market

M/S. Novelty Commotrade Private Ltd., Kolkata vs. ITO, Ward-15(3), Kolkata.

In the result, appeal of the assessee is allowed

ITA 1166/KOL/2023[2011-12]Status: DisposedITAT Kolkata17 Dec 2024AY 2011-12

Bench: Shri Sanjay Garg & Shri Rakesh Mishrai.T.A. No.1166/Kol/2023 Assessment Year: 2011-12

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

Wing was supposed to corelate the same with the records and other facts of the case and thereafter should have satisfied himself of escapement of income. Reopening is not permissible on the basis of borrowed satisfaction of the Assessing Officer. It does not mean a purely subjective satisfaction ... direct nexus or live link between the material coming to the notice of the Assessing Officer and the formation of belief regarding escapement of income. The powers of Assessing Officer to reopen an assessment, though wide, are not plenary. The words of the statute are "reason to believe

Subaitha Khani Sagul Hameethu, Manamelkudi vs. ITO, Ward-1, Pudukottai

The appeal stand allowed in terms of our above order

ITA 2498/CHNY/2024[2016-17]Status: DisposedITAT Chennai17 Dec 2024AY 2016-17

Bench: Hon’Ble Shri Manoj Kumar Aggarwal, Am & Hon’Ble Shri Manu Kumar Giri, Jm आयकरअपील सं./ Ita No.2498/Chny/2024 (िनधा:रणवष: / Assessment Year: 2016-17) Mrs. Subaitha Khani Sagul Hameethu Ito बनाम/ L/H Of Late A.Sagul Hameethu Ward-1, #681, Kottaipattinam, Pudukottai. Vs. Manamelkudi-614 619. "थायीलेखासं./जीआइआरसं./Pan/Gir No. Bjqph-6104-Q (अपीलाथ"/Appellant) : (" थ" / Respondent) अपीलाथ" कीओरसे/ Appellant By : Shri Y. Sridhar (Fca)- Ld.Ar " थ"कीओरसे/Respondent By : Shri S. Easwar (Jcit)-Ld. Sr. Dr सुनवाई की तारीख/Date Of Hearing : 16-12-2024 घोषणा की तारीख /Date Of Pronouncement : 17-12-2024 आदेश / O R D E R Manoj Kumar Aggarwal ()

For Appellant: Shri Y. Sridhar (FCA)- Ld.ARFor Respondent: Shri S. Easwar (JCIT)-Ld. Sr. DR
Section 147Section 148Section 149Section 149(1)(b)Section 56Section 56(2)(vii)

representation from the assessee. 4. It is quite clear that the case has been reopened beyond 3 years and the quantum of escapement of income is less than the prescribed threshold limit of Rs.50 Lacs. The same clearly contravene the statutory provisions of Sec. 149(1)(b). Our view