“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

Satyabir Singh Yadav, Gurgaon vs. ITO, Gurgaon

In the result all the three appeals of the assessees are partly allowed, as indicated above

ITA 3022/DEL/2017[2010-11]Status: DisposedITAT Delhi13 Jul 2023AY 2010-11

Bench: Shri Shamim Yahya & Shri Challa Nagendra Prasadआ.अ.सं .I.T.A No. 3024/Del/2017 िनधा"रण वष"/Assessment Year: 2010-11 Shri Satya Pal, Income Tax Officer, बनाम S/O. Late Maha Singh, Ward : 4 (1) Vs. Vill. & P.O. Nakhrola, Tehsil Gurgaon. Manesar, Distt. Gurgaon, Haryana – 122 001. Pan No. Aabpy6152A A N D आ.अ.सं .I.T.A No. 3022/Del/2017 िनधा"रण वष"/Assessment Year: 2010-11 Shri Satyabir Singh, Income Tax Officer, बनाम S/O. Late Maha Singh, Ward : 4 (1) Vs. Vill. & P.O. Nakhrola, Tehsil Gurgaon. Manesar, Distt. Gurgaon, Haryana – 122 001. Pan No. Aacpy7890A A N D आ.अ.सं .I.T.A No. 3023/Del/2017 िनधा"रण वष"/Assessment Year: 2010-11 Shri Rati Ram, Income Tax Officer, बनाम S/O. Late Maha Singh, Ward : 4 (1) Vs. Vill. & P.O. Nakhrola, Tehsil Gurgaon. Manesar, Distt. Gurgaon, Haryana – 122 001. Pan No. Aaopy3440Q अपीलाथ"/ Appellants ""थ"/ Respondents

For Appellant: Shri K. Sampath, Advocate; &

Section 143(3)Section 147Section 234ASection 253Section 54B

charge of Other Ranks of the Army Personnel. If at all any action had to be taken against the Appellant for any alleged escapement of income then it was for the Army Salary Circle AO holding authority over the Appellant who could have done so. Clearly the Income-tax Officer ... issued the notice u/s 148 of the Act to the Appellant on 30.03.2015 after having recorded a satisfaction as to the alleged escapement of income of the Appellant. The ITO Ward 3(5) Gurugram does not seem to have made any inquiry or the relevant issues before issuing a notice

Sandeep, Panipat vs. ITO, Ward- 4, Panipat

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

ITA 414/DEL/2019[2009-10]Status: DisposedITAT Delhi12 Jul 2023AY 2009-10

For Appellant: Shri J.B. Sharma, AdvocateFor Respondent: Ms. Kajal Singh, Sr. DR

Section 144Section 147Section 148

considered at that stage. The A.O. has squarely applied his mind to the information received and arrived at a logical satisfaction regarding escapement of income. Moreover, the Addl. CIT vide her letter dated 10/11.10.2018 while forwarding the A.O.'s report has also mentioned that before initiating proceedings

Shri Avinash Nivrutti Bhosale, Pune vs. Dy CIT Central Cir-2(3), Mumbai

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

ITA 531/MUM/2021[2010-11]Status: DisposedITAT Mumbai10 Jul 2023AY 2010-11

Bench: Shri Kuldip Singh & Shri Gagan Goyal & Shri Avinash Nivrutti Bhosale, 2, Abil House, Ganesh Khind Road, Range Hill Corner, Pune-411 007 ...... Appellant Vs. Dcit Cent. Cir 2(3) 8Th Floor, R. No. 803, Old Cgo Bldg, Pratistha Bhavan, M. K. Road, Mumbai-400 020 Pan – Abtpb8151F ..... Respondent

For Appellant: Shri Madhur Agarwal, Ld. ARFor Respondent: Smt. Shailja Rai, Ld. DR

Section 143(3)Section 153ASection 250

received and paid unaccounted cash loan, which has to be added to the income of the assessee after verification and also the escapement of income by unaccounted cash loan is more than Rs. 50,00,000/- in each of the relevant year

M/S A J Coal Pvt Ltd., Mumbai vs. ITO 6 (1)(1), Mumbai

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

ITA 7289/MUM/2019[2009-10]Status: DisposedITAT Mumbai10 Jul 2023AY 2009-10

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal () Assessment Year: 2009-10 Ito-6(1)(1), M/S A.J. Coal Pvt. Ltd., Aayakar Bhavan, 24A, Coal Depot, Sewree (E), Vs. Room No. 503, 5Th Floor, M.K. Mumbai-400015. Road, New Marine Lines, Mumbai-400020. Pan No. Aabca 0386 M Appellant Respondent Assessment Year: 2009-10 M/S A.J. Coal Pvt. Ltd., Ito-6(1)(1), C/O M/S Jayesh Sanghrajka & Aayakar Bhavan, Room No. 503, Co. Llp, 405, Hind Rajasthan Vs. 5Th Floor, M.K. Road, New Marine Centre, Ds Phalke Road, Dadar Lines, Mumbai-400020. (East), Mumbai-400014. Pan No. Aabca 0386 M Appellant Respondent

For Appellant: Mr. Shubham Shah, ARFor Respondent: Ms. Indira Adakil, DR

Section 148Section 151

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “SMC” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND MS. KAVITHA

ITO 6 (1)(1), Mumbai vs. M/S A J Coal Pvt Ltd., Mumbai

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

ITA 5718/MUM/2019[2009-10]Status: DisposedITAT Mumbai10 Jul 2023AY 2009-10

For Appellant: Mr. Shubham Shah, ARFor Respondent: Ms. Indira Adakil, DR

Section 148Section 151

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “SMC” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND MS. KAVITHA

Yogesh Goyal, Dhamtari vs. Principal Commissioner of Income Tax, Raipur-1, Raipur

In the result, appeal of the assessee is partly allowed in terms of our observations hereinabove,

ITA 57/RPR/2022[2012-13]Status: DisposedITAT Raipur10 Jul 2023AY 2012-13

Bench: SHRI RAVISH SOOD (Judicial Member), SHRI ARUN KHODPIA (Accountant Member)

For Appellant: Shri Praveen KhandelwalFor Respondent: Shri V.K.Singh, CIT-DR

Section 143(3)Section 147Section 148Section 263

since there was no addition on the basis of reasons to believe initially formed by the ld. AO, shows that there was no escapement of income, however, there was a different ground or reason to believe based on which ld. Pr.CIT has initiated the proceedings u/s.263 of the Act which ... Pr.CIT u/s.263 of the Act were on an issue which was not forming a belief of the revenue that there was some escapement of income on the basis of sch reason. The original issue forming the reason to believe that the escaped assessment was relating to certain transactions with

Hukum Singh, Ambikapur vs. Principal Commissioner of Income Tax, Raipur-1, Raipur

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

ITA 136/RPR/2022[2015-16]Status: DisposedITAT Raipur10 Jul 2023AY 2015-16

Bench: Shri Ravish Sood & Shri Arun Khodpiaआयकर अपील सं. / Ita No.136/Rpr/2022 "नधा"रण वष" / Assessment Year : 2015-16 Hukum Singh Near Pahuna Shop, Kedarpur, Ambikapur, Sarguja (C.G.) Pan : Atpps6279P .......अपीलाथ" / Appellant बनाम / V/S. The Pr. Commissioner Of Income Tax, Raipur-1 (C.G.) ……""यथ" / Respondent

For Appellant: Shri R.B Doshi, CAFor Respondent: Shri V.K Singh, CIT-DR

Section 143(3)Section 263Section 44A

case the A.O in the course of the limited scrutiny assessment proceedings felt that apart from the CASS information there was potential escapement of income of more than Rs.10 lac, then the same could be taken for complete scrutiny with the approval of the administrative Principal Commissioner of Income Tax/Commissioner

K R Packaging (P) Ltd, New Delhi vs. ACIT Circle-5(1), New Delhi

In the result the appeal of the assessee in ITA No

ITA 71/DEL/2021[2003-04]Status: DisposedITAT Delhi07 Jul 2023AY 2003-04

Bench: Shri N.K. Billaiya & Ms. Astha Chandra

For Appellant: Dr. Rakesh Gupta, AdvFor Respondent: Shri Om Prakash, Sr. DR

Section 143(2)Section 147Section 148Section 234BSection 68

reasons for the formation of opinion should have a rational connection with the formation of the belief that there has been an escapement of income chargeable to tax (See: ITO v. Lakhmani Mewal Das, 1976 3 SCC 757] (ii) The expression "reason to believe" is stronger than the word "satisfied

Satyamurti Ramasundar, Gurgaon vs. ACIT Circle-4(1), Gurgaon

In the result, appeal of the assessee is allowed

ITA 371/DEL/2021[2012-13]Status: DisposedITAT Delhi07 Jul 2023AY 2012-13

Bench: Shri Saktijit Dey, Vice- & Shri Girish Agrawalassessment Year: 2012-13 Satyamurti Ramasunder, Acit, D-502, Ivy Complex, Circle 4(1), Vs. Sushant Lok, 1-Blocka, Gurgaon Gurgaon (Haryana). (Pan: Aaapr0741H) (Appellant) (Respondent)

For Appellant: Shri Satyen Sethi & Arta Trana Panda, AdvsFor Respondent: Shri Ram Dhan Meena, Sr. DR

Section 143(3)Section 147Section 148Section 54Section 54F

seriatim, and the same are noted as under: i) During pendency of proceedings under Section 154, reassessment proceedings cannot be initiated; ii) Alleged escapement of income was not on account of omission or failure on the part of the assessee to disclose fully and truly all the material facts necessary

Shri Amarjeet Singh Bhatia, Raipur vs. Assistant Commissioner of Income Tax, Circle 3(1), Raipur

In the result, appeal of the assessee is allowed in terms of our observations hereinabove

ITA 63/RPR/2018[2007-08]Status: DisposedITAT Raipur07 Jul 2023AY 2007-08

Bench: SHRI RAVISH SOOD (Judicial Member), SHRI ARUN KHODPIA (Accountant Member)

For Appellant: Shri Sunil Kumar AgrawalFor Respondent: Shri Piyush Tripathi, Sr. DR

Section 119Section 143(2)Section 143(3)Section 147Section 148Section 151

opening balance sheet for the alleged two accounts are duly reflected in the books of accounts of the assessee. Thus, there is no escapement of income which is chargeable to tax as escaped assessment in the year under consideration. The explanation submitted by the AR of the assessee

Mr. Anthony P Lewis, Mumbai vs. ITO-22(1)(1), Mumbai

ITA 1813/MUM/2020[2009-10]Status: DisposedITAT Mumbai06 Jul 2023AY 2009-10

For Appellant: Ms. Aarti Sathe &For Respondent: Smt Sailja Rai

Section 143(3)Section 147Section 54

material facts for framing the assessment under Section 143(3) of the Act were before the CIT(A) and therefore there was no escapement of income as contemplated under the provisions of Section 147 of the Act. Further, the fact that the sale of property at Peddar road ... relevant. In other words, at the initiation stage, what is required 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 which a reasonable person could have formed a requisite

Kala Ramesh Parmar, Mumbai vs. ITO Ward- 23(2)(6), Mumbai

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

ITA 581/MUM/2023[2012-13]Status: DisposedITAT Mumbai05 Jul 2023AY 2012-13

Bench: Shri Pavan Kumar Gadalekala Ramesh Parmar Ito Ward – 23(2)(6), 2/21,Kishorebuilding, Room No.303, बनाम/ Opp Edward Cinema, 3Rd Floor, Vs. 2Nd Floor, 521, Earnest House, Kalbadevi Road, Nariman Point, Mumbai- 400002. Mumbai- 400021. "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aadpp6229M (""थ" / Respondent) (अपीलाथ" /Appellant)

For Appellant: Shri.Jitendra Singh.ARFor Respondent: Shri.Abhishek Kumar Singh, DR

Section 143(1)Section 143(3)Section 148Section 234BSection 250Section 68

formation of the belief that income chargeable to tax has escaped assessment must have a material bearing on the question of escapement of income of the assessee from assessment because of his failure or omission to disclose fully and truly all material facts. Once there exists reasonable grounds ... every material howsoever vague and indefinite or distant, remote and far-fetched which would warrant formation of the belief relating to escapement of income. Moreover, powers of the Income-tax Officer to reopen assessment, though wide are not plenary. The words of the statute are "reason to believe

Durga Shankar Chodhery, Saraipali, Mahasamund vs. Income Tax Officer, Ward-Mahasamund, Mahasamund

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

ITA 195/RPR/2023[2011-12]Status: DisposedITAT Raipur05 Jul 2023AY 2011-12

Bench: SHRI RAVISH SOOD (Judicial Member), SHRI ARUN KHODPIA (Accountant Member)

For Appellant: Shri Nikhilesh Begani, CAFor Respondent: Shri Choudhary N.C.Roy, Sr. DR

Section 147Section 148Section 250Section 68

r.w.s.144 of the Act is highly provisions of the law since, the reasons recorded by the Ld.AO lacks formation of belief of escapement of income thereby vitiating the entire reassessment order. Hence, it is earnestly prayed that the Reassessment Order may please be quashed and cancelled on this ground alone

DCIT, CC-2(2), Mum vs. Shri Narendra S Shah, Mumbai

ITA 2566/MUM/2022[2013-14]Status: DisposedITAT Mumbai30 Jun 2023AY 2013-14

Bench: Shri Vikas Awasthy () & Shri Om Prakash Kant ()

For Appellant: Karan JainFor Respondent: Kamble Minal Mohan

Section 143(3)Section 147Section 271(1)(c)Section 40

case was reopene was reopened Ws.147 of the Act for the reasons d Ws.147 of the Act for the reasons escapement of income of Rs. 24,26,156/ escapement of income of Rs. 24,26,156/-under section under section 40(a)(ia) of the IT Act 1961. The objection