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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

Suntcoppa Vyavasaya Seva Sahakara Bank Limited, Kodagu vs. The Principal Commissioner of Income Tax, Mysore

ITA 487/BANG/2021[2015-16]Status: DisposedITAT Bangalore30 Jun 2022AY 2015-16
For Appellant: None
Section 143(3)Section 260Section 263Section 80P(2)(a)

facts and circumstances and on law, the Hon'ble Pr.CIT assumed the jurisdiction u/s 263 on the issues on which the escapement of income are on probability and further based on pure guess-work which is not permissible u/s 263 and therefore improper assumption jurisdiction on surmises and conjectures

Assistant Commissioner of Income Tax 17(2)), Mumbai vs. Navjbai Ratan Tata Trust, Mumbai

In the result, appeal by the assessee is partly allowed, while appeal by the Revenue is dismissed

ITA 1315/MUM/2018[2010-11]Status: DisposedITAT Mumbai27 Jun 2022AY 2010-11
Section 11Section 11(1)Section 11(1)(a)Section 11(5)Section 13(1)(d)Section 143(1)Section 143(3)Section 147Section 148Section 164(2)

Page 8 of 10 15. In the present case the reasons disclose that the Assessing Officer reached the belief that there was escapement of income "on going through the return of income" filed by the assessee after he accepted the return under Section 143(1) without scrutiny, and nothing more ... April, 1989, the Assessing Officer has power to reopen, provided there is "tangible material" to come to the conclusion that there is escapement of income from assessment. Reasons must have a link with the formation of the belief.... " …………… 12. Thus, there was, in our opinion, no tangible material before

Navjbai Ratan Tata Trust, Mumbai vs. Additional Director of Income Tax (Exemptions) Range-II(Now Assessed by the Assistant Commissioner of Income Tax 17(2)), Mumbai

In the result, appeal by the assessee is partly allowed, while appeal by the Revenue is dismissed

ITA 1300/MUM/2018[2010-11]Status: DisposedITAT Mumbai27 Jun 2022AY 2010-11
Section 11Section 11(1)Section 11(1)(a)Section 11(5)Section 13(1)(d)Section 143(1)Section 143(3)Section 147Section 148Section 164(2)

Page 8 of 10 15. In the present case the reasons disclose that the Assessing Officer reached the belief that there was escapement of income "on going through the return of income" filed by the assessee after he accepted the return under Section 143(1) without scrutiny, and nothing more ... April, 1989, the Assessing Officer has power to reopen, provided there is "tangible material" to come to the conclusion that there is escapement of income from assessment. Reasons must have a link with the formation of the belief.... " …………… 12. Thus, there was, in our opinion, no tangible material before

Ghanshyam Vashishta, Surat vs. ACIT CC-1(3), Mumbai

In the result, all the appeals filed by the different assessees are allowed in terms as indicated above

ITA 341/MUM/2022[2015-16]Status: DisposedITAT Mumbai24 Jun 2022AY 2015-16

Bench: Shri Amit Shukla, Jm & Shri Amarjit Singh, Am

Section 143(3)

deleted, which matter has already attained finality. Accordingly, the AO cannot assume jurisdiction u/s 147 to make protective addition once there is no escapement of income and secondly his reasoning is based on wrong assumption of facts. On this ground, we hold that reopening itself

Hitesh Chhatwal, Mumbai vs. DCIT CC -5(4), Mumbai

In the result, the appeals of the assessee are allowed while for the appeal of the revenue are dismissed

ITA 6418/MUM/2019[2011-12]Status: DisposedITAT Mumbai24 Jun 2022AY 2011-12

Bench: Shri Pavan Kumar Gadale & Shri Amarjit Singh

For Appellant: Mani JainFor Respondent: Vinay Sinha
Section 54F

11 Appeals Shri Hitesh Chhatwal Vs. DCIT, CC-5(4) 1 IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI

ACIT - 2(3)(1), Mumbai vs. Lord Krishna Bank Ltd. (No Merged With Hdfc Bank Ltd.), Mumbai

In the result, the appeal of the revenue is dismissed

ITA 6186/MUM/2016[2002-03]Status: DisposedITAT Mumbai24 Jun 2022AY 2002-03
For Appellant: Shri Yogesh Thar/Chaitanya JoshiFor Respondent: Shri Ashish Deharia (Sr. AR)
Section 143(3)Section 147Section 148Section 2Section 36(1)(vii)Section 36(1)(viia)

power to re-open an assessment, provided there is “tangible material” to come to the conclusion that there is escapement of income from assessment. The reasons must have a live link with the formation of belief in the garb of reassessment, the AO is not permitted to review his order ... April, 1989, Assessing Officer has power to re-open, provided there is "tangible material" to come to the conclusion that there is escapement SJ income from assessment. Reasons must have a live link with the formation of the belief.” 7. Moreover, it was also brought to our notice that

Ambaji Resources & Credit P. Ltd., Mumbai vs. ITO-3(1)(2), Mumbai

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

ITA 1390/MUM/2021[2007-08]Status: DisposedITAT Mumbai23 Jun 2022AY 2007-08

Bench: Shri Pavan Kumar Gadale & Shri Gagan Goyal

For Appellant: Shri.AK Tibrewal.ARFor Respondent: Shri.Pramod Nikalje.DR
Section 143(3)Section 147Section 148(2)Section 68Section 69

jurisdiction of reopening the assessment when there was nothing recorded in the impugned assessment order that there was reasons to believe of escapement of income but on the other hand the Assessing Officer himself admitted in Para 2 of the assessment order that the case was reopened for examination ... confirming the additions/disallowances referred to in Ground Nos. 7 to 9 being unconnected issues, when the Assessing Officer did not find any escapement of income in respect for which reasons were recorded. 11. That the impugned order passed by Ld. Commissioner of Income Tax (Appeals) is against law and facts

M/S Artendz Pabs Pvt Ltd., Mumbai vs. DCIT Circle-12(1)(1), Mumbai

In the result, ground of appeal No

ITA 2475/MUM/2019[2013-14]Status: DisposedITAT Mumbai21 Jun 2022AY 2013-14

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

For Appellant: NoneFor Respondent: Shri Mehul Jain
Section 148Section 36(1)(iii)

circumstances beyond their control. 2. The Hon. CIT(A) and the Ld. A.O. erred in assuming and presuming that there was escapement of income. 3. The Ld. A.O. erred in re-opening the assessment U/S. 148. 4. The Hon. CIT(A) was not justified in confirming the addition made

M/S Artendz Pabs Pvt Ltd., Mumbai vs. DCIT Circle-12(1)(1), Mumbai

In the result, ground of appeal No

ITA 2474/MUM/2019[2012-13]Status: DisposedITAT Mumbai21 Jun 2022AY 2012-13

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

For Appellant: NoneFor Respondent: Shri Mehul Jain
Section 148Section 36(1)(iii)

circumstances beyond their control. 2. The Hon. CIT(A) and the Ld. A.O. erred in assuming and presuming that there was escapement of income. 3. The Ld. A.O. erred in re-opening the assessment U/S. 148. 4. The Hon. CIT(A) was not justified in confirming the addition made

M/S Artendz Pabs Pvt Ltd., Mumbai vs. DCIT Circle-12(1)(1), Mumbai

In the result, ground of appeal No

ITA 2473/MUM/2019[2011-12]Status: DisposedITAT Mumbai21 Jun 2022AY 2011-12

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

For Appellant: NoneFor Respondent: Shri Mehul Jain
Section 148Section 36(1)(iii)

circumstances beyond their control. 2. The Hon. CIT(A) and the Ld. A.O. erred in assuming and presuming that there was escapement of income. 3. The Ld. A.O. erred in re-opening the assessment U/S. 148. 4. The Hon. CIT(A) was not justified in confirming the addition made

M/S. Century Bangalore City Centre Private Limited, Bangalore vs. The Deputy Commissioner of Income Tax, Central Circle- 1(3), Bangalore

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

ITA 357/BANG/2020[2014-15]Status: DisposedITAT Bangalore21 Jun 2022AY 2014-15

Bench: Shri N.V. Vasudevanand Ms. Padmavathy S

For Appellant: Shri. R. Ramakrishnan, CAFor Respondent: Shri. Praveen Karanth, CIT(DR)(ITAT), Bengaluru
Section 131Section 132Section 153C

calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating Material and draw inference that there is escapement of income by way of interest by the assessee. this evidence cannot be considered for reopening assessment under 153C r.w.s. 153A to determine any concealed income ... calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating material and draw inference that there is escapement of income by way of interest by the assessee. The agreement for sale dated 08.04.2008 point no. 23(b), page  no. 20 clearly says that advance

M/S. Century Bangalore City Centre Private Limited, Bangalore vs. The Deputy Commissioner of Income Tax, Central Circle- 1(3), Bangalore

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

ITA 356/BANG/2020[2013-14]Status: DisposedITAT Bangalore21 Jun 2022AY 2013-14

Bench: Shri N.V. Vasudevanand Ms. Padmavathy S

For Appellant: Shri. R. Ramakrishnan, CAFor Respondent: Shri. Praveen Karanth, CIT(DR)(ITAT), Bengaluru
Section 131Section 132Section 153C

calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating Material and draw inference that there is escapement of income by way of interest by the assessee. this evidence cannot be considered for reopening assessment under 153C r.w.s. 153A to determine any concealed income ... calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating material and draw inference that there is escapement of income by way of interest by the assessee. The agreement for sale dated 08.04.2008 point no. 23(b), page  no. 20 clearly says that advance

M/S. Century Bangalore City Centre Private Limited, Bangalore vs. The Deputy Commissioner of Income Tax, Central Circle- 1(3), Bangalore

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

ITA 355/BANG/2020[2012-13]Status: DisposedITAT Bangalore21 Jun 2022AY 2012-13

Bench: Shri N.V. Vasudevanand Ms. Padmavathy S

For Appellant: Shri. R. Ramakrishnan, CAFor Respondent: Shri. Praveen Karanth, CIT(DR)(ITAT), Bengaluru
Section 131Section 132Section 153C

calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating Material and draw inference that there is escapement of income by way of interest by the assessee. this evidence cannot be considered for reopening assessment under 153C r.w.s. 153A to determine any concealed income ... calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating material and draw inference that there is escapement of income by way of interest by the assessee. The agreement for sale dated 08.04.2008 point no. 23(b), page  no. 20 clearly says that advance

M/S. Century Bangalore City Centre Private Limited, Bangalore vs. The Deputy Commissioner of Income Tax, Central Circle- 1(3), Bangalore

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

ITA 354/BANG/2020[2011-12]Status: DisposedITAT Bangalore21 Jun 2022AY 2011-12

Bench: Shri N.V. Vasudevanand Ms. Padmavathy S

For Appellant: Shri. R. Ramakrishnan, CAFor Respondent: Shri. Praveen Karanth, CIT(DR)(ITAT), Bengaluru
Section 131Section 132Section 153C

calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating Material and draw inference that there is escapement of income by way of interest by the assessee. this evidence cannot be considered for reopening assessment under 153C r.w.s. 153A to determine any concealed income ... calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating material and draw inference that there is escapement of income by way of interest by the assessee. The agreement for sale dated 08.04.2008 point no. 23(b), page  no. 20 clearly says that advance

M/S. Century Bangalore City Centre Private Limited, Bangalore vs. The Deputy Commissioner of Income Tax, Central Circle- 1(3), Bangalore

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

ITA 353/BANG/2020[2010-11]Status: DisposedITAT Bangalore21 Jun 2022AY 2010-11

Bench: Shri N.V. Vasudevanand Ms. Padmavathy S

For Appellant: Shri. R. Ramakrishnan, CAFor Respondent: Shri. Praveen Karanth, CIT(DR)(ITAT), Bengaluru
Section 131Section 132Section 153C

calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating Material and draw inference that there is escapement of income by way of interest by the assessee. this evidence cannot be considered for reopening assessment under 153C r.w.s. 153A to determine any concealed income ... calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating material and draw inference that there is escapement of income by way of interest by the assessee. The agreement for sale dated 08.04.2008 point no. 23(b), page  no. 20 clearly says that advance

M/S. Century Bangalore City Centre Private Limited, Bangalore vs. The Deputy Commissioner of Income Tax, Central Circle- 1(3), Bangalore

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

ITA 352/BANG/2020[2009-10]Status: DisposedITAT Bangalore21 Jun 2022AY 2009-10

Bench: Shri N.V. Vasudevanand Ms. Padmavathy S

For Appellant: Shri. R. Ramakrishnan, CAFor Respondent: Shri. Praveen Karanth, CIT(DR)(ITAT), Bengaluru
Section 131Section 132Section 153C

calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating Material and draw inference that there is escapement of income by way of interest by the assessee. this evidence cannot be considered for reopening assessment under 153C r.w.s. 153A to determine any concealed income ... calculation blocked in the advance of the assessee company. This material cannot be treated as incriminating material and draw inference that there is escapement of income by way of interest by the assessee. The agreement for sale dated 08.04.2008 point no. 23(b), page  no. 20 clearly says that advance

Bombay Real Estate Development Co. P. Ltd., Mumbai vs. ITO Ward-1(1)-3, Mumbai

In the result, appeal by the assessee is allowed

ITA 513/MUM/2021[2010-11]Status: DisposedITAT Mumbai14 Jun 2022AY 2010-11

Bench: Shri Pramod Kumar & Shri Sandeep Singh Karhail

For Appellant: Shri K. Gopal a/wFor Respondent: Shri C.T. Mathews, Sr. A.R
Section 115JSection 143Section 143(3)Section 147Section 148Section 148(1)Section 14ASection 250Section 40

four elements viz. some tangible material or materials to establish that income has escaped assessment; nexus between such material and the belief of escapement of income from assessment as envisaged under Section 147; application of mind by the Bombay Real Estate Development Co. P. Ltd. ITA No.513/Mum./2021 Assessing Officer

Chouhan Builders India Housing Development P. L Td vs. Mumbai

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

ITA 4793/MUM/2019[2016-17]Status: DisposedITAT Mumbai13 Jun 2022AY 2016-17

Bench: Shri Aby T Varkey & Shri Gagan Goyalchouhan Builders India Housing Development P. Ltd. 104A, Sajid Tower, Amboli, Andheri (W), Mumbai-400058 Pan: Aaccc1839Q ...... Appellant Vs. Dcit -9(2)(1), R.No. 665A, Aayakar Bhavan, M.K. Road, Mumbai-400020. ..... Respondent Appellant By : Sh. K. Shivram With Ms. Neelam Jadhav Respondent By : Sh. Pankaj Kumar Date Of Hearing : 10/06/2022 Date Of Pronouncement : 13/06/2022 Order Per Gagan Goyal, A.M: This Appeal By The Assessee Is Directed Against The Order Of Commissioner Of Income Tax (Appeals)-16, Mumbai [Hereinafter Referred To As ‘The Cit(A)’] Vide Order Dated 31.05.2019 For The Assessment Year (Ay) 2016-17. The Assessee Has Raised The Following Grounds Of Appeal: “1. The Learned Cit (A) 16 (Hereinafter Referred To As The Cit (A)) Erred In Law & On Facts In Confirming The Assessment Of The Total Income Of The Appellant At Rs.15,00,000/- As Against Loss Of Rs. 89,84,401.24 Returned By The Appellant. 2. Order Dt.31/05/19 Passed By Ld. Cit(A) As Well As Order Dt.27/12/18 Passed By Ld. Ao Were Bad In Law As The Same Were Not Based On Facts But Were Based On Assumptions Or Surmises Or Erroneous Findings & Has Not Considered Submissions Made By Appellant Or Authorities Cited By Appellant.

For Appellant: Sh. K. Shivram with Ms. Neelam JadhavFor Respondent: Sh. Pankaj Kumar
Section 143(3)Section 147Section 148Section 151(2)Section 69A

alleged part Statement, Akshay J. Doshi has admitted that no data belongs to any period from 2012 onwards therefore question of any escapement of income for A.Y.16-17 do not arise. 4. The Ld. CIT (A) has erred in law and on facts in not adjudicating ground No.3 that Reassessment Order

Ibm India Private Limited, Bengaluru vs. Assistant Commissioner of Income Tax, Circle- 3(1)(1), Bengaluru

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

ITA 584/BANG/2020[2006-07]Status: DisposedITAT Bangalore13 Jun 2022AY 2006-07
For Appellant: Shri Ajay Rotti, CA
Section 143(3)Section 147Section 250Section 29Section 36(1)(vii)Section 50B

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

Vilas Sadashiv Nalawade, Mumbai vs. ITO 25(3)(5), Mumbai

In the result, the appeal is allowed in the terms indicated above

ITA 336/MUM/2020[2007-08]Status: DisposedITAT Mumbai09 Jun 2022AY 2007-08
Section 139Section 147Section 54F

incorrect inasmuch while, in the reassessment proceedings, it is indeed “not open to the assessee to seek review of items unconnected with the escapement of income for the purpose of computation of the income escaping assessment”, as was held in Sun Engineers Works (supra), the claim of exemption under section