“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

V Ramakrishnan, Chennai vs. DCIT Central Circle III(4), Chennai

In the result, the appeal for the A

ITA 2197/CHNY/2005[1999-2000]Status: DisposedITAT Chennai26 Dec 2025AY 1999-2000

Bench: Shri Manu Kumar Giri & Shri S. R. Raghunatha

For Appellant: Shri. N. Arjun Raj, AdvocateFor Respondent: Shri. Bipin. C.N., C.I.T

Section 132Section 148Section 15Section 158BSection 17(1)(iv)

became irrecoverable and becomes a capital loss to be set off against the purported capital gains and as a result the presumption of escapement of income in the hands of the assessee was wrong. 44. Furthermore, the Ld.AR argued that on facts and in the circumstances of the present case

Buniya Amin, Kota vs. ITO WD-2(2), Kota

ITA 1324/JPR/2025[2017-18]Status: HeardITAT Jaipur24 Dec 2025AY 2017-18

Bench: SMT. ANNAPURNA GUPTA (Accountant Member), SHRI NARINDER KUMAR (Judicial Member)

For Appellant: Shri Kushal Soni, C.A. (through V.C.)For Respondent: Mrs. Anita Rinesh, JCIT

Section 147Section 148Section 69A

Jaipur Total 76,31,100/- 3. Arguments heard. File perused. Case of the Assessee is re-opened due to escapement of income 4. A perusal of assessment order would reveal that initially the information available as per record was about deposit of cash to the tune

Hiteshbhai Rameshbhai Patel, Surat vs. ITO Ward, 2, Bardoli

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

ITA 484/SRT/2025[2012-13]Status: DisposedITAT Surat23 Dec 2025AY 2012-13

Bench: Shri Sandeep Gosain () & Shri Om Prakash Kant () Assessment Year: 2012-13 Hiteshbhai Rameshbhai Patel Income Tax Officer, 466 Kanbivad, Goddha Mahuwa, Ward-2, Bardoli, Income Tax Taluka Valod, Dist. Surat 394630 Vs. Office, 2Nd Floor, Bsnl Gujarat, Building, Opp. Jalaram Temple, Station Road, Bardoli- 394601 Pan No. Avdpp 6788 Q Appellant Respondent Assessee By : Mr. Sakar Sharma, Ar Revenue By : Mr. J.K. Chandani, Sr-Dr

For Appellant: Mr. Sakar Sharma, ARFor Respondent: Mr. J.K. Chandani, Sr-DR

Section 143(3)Section 147Section 148Section 151(1)Section 68

erred on facts and in law in upholding issuance of notice u/s 147 and assessment u/s 147 without appreciating that there was no escapement of income. Hiteshbhai Rameshbhai Patel 2 2. The Ld. CIT(A)-NFAC erred on facts and in law in confirming addition ... cash deposit per-se, by itself, does not constitute income and, therefore, could not form the basis for recording a valid belief of escapement of income. It was submitted that the reasons recorded by the Assessing Officer were founded on mere suspicion, were vague and far-fetched, and disclosed

Mehmud Ahmed Mian Ahmed Pothigara, Himatnagar vs. The ITO, Ward-1, Himatnagar

In the result, all the appeals filed by the assessee are partly allowed for statistical purposes

ITA 1810/AHD/2025[2016-17]Status: DisposedITAT Ahmedabad23 Dec 2025AY 2016-17

Bench: Ms. Suchitra R. Kamble

Section 148Section 234Section 250Section 44ASection 69A

same into the books of account. Accordingly, the case of the assessee was re-opened with a reason to belief that there was escapement of income to the tune of Rs.8,20,273/-. Consequently, notice under section 148 of the Act was issued on 31.03.2021 after obtaining the requisite approval ... appeal of the assessee. 5. The Ld. AR submitted that the reason for reopening of the assessment was based solely on the alleged escapement of income to the tune of Rs.8,20,273/- arising from the search conducted at the premises of the Mehta Soni Group

Mehmud Ahmed Mian Ahmed Pothigara, Himatnagar vs. The ITO, Ward-1, Himatnagar

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

ITA 1809/AHD/2025[2015-16]Status: DisposedITAT Ahmedabad23 Dec 2025AY 2015-16

Bench: Ms. Suchitra R. Kamble

Section 148Section 234Section 250Section 44ASection 69A

Mehmud Ahmed Mian Ahmed Pothigara, Himatnagar vs. The ITO, Ward-1, Himatnagar

In the result, all the appeals filed by the assessee are partly allowed for statistical purposes

ITA 1808/AHD/2025[2014-15]Status: DisposedITAT Ahmedabad23 Dec 2025AY 2014-15

Bench: Ms. Suchitra R. Kamble

Section 148Section 234Section 250Section 44ASection 69A

Mehmud Ahmed Mian Ahmed Pothigara, Himatnagar vs. The ITO, Ward-1, Himatnagar

In the result, all the appeals filed by the assessee are partly allowed for statistical purposes

ITA 1807/AHD/2025[2013-14]Status: DisposedITAT Ahmedabad23 Dec 2025AY 2013-14

Bench: Ms. Suchitra R. Kamble

Section 148Section 234Section 250Section 44ASection 69A

Khazana Stores Pvt. Ltd., Ahmedabad vs. The ITO, Ward-2(1)(1), Ahmedabad

ITA 1506/AHD/2025[2017-18]Status: DisposedITAT Ahmedabad23 Dec 2025AY 2017-18

Bench: Shri Sanjay Garg & Shri Makarand Vasant Mahadeokarआयकर अपील सं/Ita No. 1506/Ahd/2025 निर्धारण वर्ष / Assessment Year : 2017-18 Khazana Stores Pvt. Ltd. The Ito Gf 2 Commerce House 2 बनाम/ Ward 2(1)(1) Judges Bunglow Road, V/S. Ahmedabad 380 015 Bodakdev, Ahmedabad 380 054 स्थायी लेखा सं./Pan: Aaack 7880 R (अपीलार्थी/ Appellant) (प्रत्यर्थी / Respondent) Assessee By: Shri S.N. Divatia & Shri Samir Vora, Ars Revenue By : Shri Kalpesh Rupavatia, Sr. Dr सुनवाई की तारीख/Date Of Hearing : 30/09/2025 घोषणा की तारीख / Date Of Pronouncement: 23/12/2025 आदेश/Order Per Sanjay Garg: The Present Appeal Has Been Preferred By The Assessee Against The Order Of The Learned Commissioner Of Income Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi [Hereinafter Referred To As 'Cit(A)'] Dated 07/07/2025 For Assessment Year (Ay) 2017-18. 2. The Assessee, In This Appeal Has Taken The Following Grounds Of Appeal:

For Appellant: Shri S.N. Divatia &For Respondent: Shri Kalpesh Rupavatia, Sr. DR

Section 143(1)Section 147Section 148Section 250Section 69A

assessment proceedings. Your, Honour is, therefore, requested to kindly consider the same for approval. BASIS OF FORMING REASON TO BELIEVE AND DETAILS OF ESCAPEMENT OF INCOME As per the information received from the credible sources and preliminary investigation clearly reveal that the assessee has received in his bank account cash ... reproduced reasons recorded, the Ld. AR has submitted that the only reason on the basis of which the AO formed the belief of escapement of income of the assessee was that there were huge cash deposits in the bank account of the assessee as per the information received

Arcoy Industries (India) Private Limited, Ahmedabad vs. The DCIT, Circle-1(1)(1), Ahmedabad

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

ITA 427/AHD/2024[2017-18]Status: DisposedITAT Ahmedabad23 Dec 2025AY 2017-18

Bench: Shri Sanjay Garg & Shri Narendra Prasad Sinha

For Respondent: Shri Alpesh Parmar, CIT-DR

Section 147Section 148Section 153CSection 250Section 68

claimed non-genuine expenses of Rs.40,02,325/- in form of commission expense. Therefore, I have reasons to believe that there is an escapement of income from tax of Rs.40,02,325/- and it is a fit case for issuing notice u/s. 148 of the Act. 6. Basis of forming ... reason to believe and details of escapement of income: In this regard, it is stated that the information was not in the possession of the undersigned earlier. The said information/scheme of tax evasion could be unearthed only after investigation was done by Investigation Wing Ahmedabad after carrying out search

Arcoy Industries (India) Private Limited, Ahmedabad vs. The DCIT, Circle-1(1)(1), Ahmedabad

In the result, all the captioned four appeals of the assessee are hereby

ITA 426/AHD/2024[2015-16]Status: DisposedITAT Ahmedabad23 Dec 2025AY 2015-16

Bench: Shri Sanjay Garg & Shri Narendra Prasad Sinha

For Appellant: Shri S.N. Soparkar, Sr.AdvocateFor Respondent: Shri Alpesh Parmar, CIT-DR

Section 147Section 148Section 153CSection 250Section 68

claimed non-genuine expenses of Rs.40,02,325/- in form of commission expense. Therefore, I have reasons to believe that there is an escapement of income from tax of Rs.40,02,325/- and it is a fit case for issuing notice u/s.148 of the Act. 6. Basis of forming reason ... believe and details of escapement of income: In this regard, it is stated that the information was not in the possession of the undersigned earlier. The said information/scheme of tax evasion could be unearthed only after investigation was done by Investigation Wing Ahmedabad after carrying out search and seizure operations

Arcoy Industries (India) Private Limited, Ahmedabad vs. The DCIT, Circle-1(1)(1), Ahmedabad

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

ITA 425/AHD/2024[2014-15]Status: DisposedITAT Ahmedabad23 Dec 2025AY 2014-15

Bench: Shri Sanjay Garg & Shri Narendra Prasad Sinha

For Respondent: Shri Alpesh Parmar, CIT-DR

Section 147Section 148Section 153CSection 250Section 68

Arcoy Industries (India) Private Limited, Ahmedabad vs. The DCIT, Circle-1(1)(1), Ahmedabad

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

ITA 424/AHD/2024[2013-14]Status: DisposedITAT Ahmedabad23 Dec 2025AY 2013-14

Bench: Shri Sanjay Garg & Shri Narendra Prasad Sinha

For Respondent: Shri Alpesh Parmar, CIT-DR

Section 147Section 148Section 153CSection 250Section 68

Deputy Commissioner of Income Tax, Central Circle-1(2), Kolkata vs. Siddheshwari Vyapaar Private Limited, Kolkata

In the result, appeal of the revenue is dismissed

ITA 2280/KOL/2025[2012-13]Status: DisposedITAT Kolkata23 Dec 2025AY 2012-13

Bench: Shri Rajesh Kumar & Shri Pradip Kumar Choubeyआयकर अपील सं/Ita No.2280/Kol/2025 (निर्धारणवर्ा/Assessment Years :2012-2013) Dcit, Central Circle-1(2), Vs Siddheshwarivyapaar Pvt Ltd Kolkata 2Nd Floor, 159, Ravindra Sarani Kolkata-700007 Pan No. :Aancs 2337 J (अपीलधर्थी /Appellant) .. (प्रत्यर्थी / Respondent) रधजस्वकीओरसे /Revenue By : Shri Sanat Kumar Raha, Cit-Dr निर्धाररतीकीओरसे /Assessee By : Shrisoumitra Choudhury & Rainak Jain, Advocates सुनवाई की तारीख / Date Of Hearing : 09/12/2025 घोषणा की तारीख/Date Of Pronouncement : 23.12.2025 आदेश / O R D E R Per Rajesh Kumar, Am: This Is An Appeal Filed By The Revenueagainst The Order Passed By The Ld. Cit(A), Kolkata-20, Dated 06.05.2025For The Assessment Year2012-2013. 2. The Appeal Of The Revenue Is Barred By 69 Days. Considering The Submissions Of The Ld. Cit-Dr & Looking To The Facts Of The Case, We Condone The Delay Of 69 Days In Filing The Present Appeal By The Revenue & The Appeal Is Admitted For Hearing. 3. The Only Issue Raised In This Appeal Is Against The Order Of The Ld. Cit(A) In Deleting The Addition Of Rs.6,82,00,000/- Made U/S.68 Of The Act On Account Of Unexplained Cash Credits Received From Shell Entities In The Guise Of Share Capital.

For Appellant: ShriSoumitra Choudhury and Rainak Jain, AdvocatesFor Respondent: Shri Sanat Kumar Raha, CIT-DR

Section 131Section 133(6)Section 143(2)Section 143(3)Section 148Section 68

escaped assessment. The court emphasized that the reasons for reopening should demonstrate the link between the information available and the belief of escapement of income, ensuring that the reopening process is not arbitrary and that there is a genuine basis for the belief. In the case

Arun Kumar Sarup, Mumbai vs. Dy. Commissioner of Income Tax Circle 1(1)(1), Mumbai

In the result, all the three appeals are treated as allowed for statistical purposes

ITA 4709/MUM/2025[2015-2016]Status: DisposedITAT Mumbai23 Dec 2025AY 2015-2016

Bench: Hon’Ble Shri Sandeep Gosain& Shri Prabhash Shankararun Kumar Sarup Vs. Dy. Commissioner Of 2Nd Floor, Amartara Pvt. Ltd. Income Tax Circle Saki Vihar Road, Powai, 1(1)(1), Mumbai Mumbai – 400072. 553, 5Th Floor, Aaykar Bhavn, Maharshi Karve Road, Mumbai - 400020 Pan/Gir No. Aahps2384Q (Applicant) (Respondent)

Section 250Section 271(1)(c)Section 69

view that the long term capital gains declared by the assessee is bogus in nature and accordingly formed the belief that there is escapement of income in the hands of the assessee herein in these three years. Hence, the AO reopened the assessment of these three years under consideration

Sunita Khandelwal, Mumbai vs. PCIT-Central -1, Mumbai

In the result, the grounds of appeal raised by the assessee are allowed

ITA 3541/MUM/2025[2019-20]Status: DisposedITAT Mumbai23 Dec 2025AY 2019-20

Bench: Shri Saktijit Dey & Shri Jagadish

For Appellant: Shri Ajay R. Singh &For Respondent: Shri Arun Kanti Datta – CIT(DR)

Section 132Section 142(1)Section 143(3)Section 153CSection 263

PCIT has specifically referred to any material which demonstrates the direct involvement of the assessee in any transaction, resulting in escapement of income at her hands, thereby, resulting in prejudice to the Revenue. In fact, in the order passed u/s. 263 of the Act, ld. PCIT has merely reproduced

Sunita Khandelwal, Mumbai vs. PCIT (Central)-1, Mumbai

In the result, the grounds of appeal raised by the assessee are allowed

ITA 3540/MUM/2025[2018-19]Status: DisposedITAT Mumbai23 Dec 2025AY 2018-19

Bench: Shri Saktijit Dey & Shri Jagadish

For Appellant: Shri Ajay R. Singh &For Respondent: Shri Arun Kanti Datta – CIT(DR)

Section 132Section 142(1)Section 143(3)Section 153CSection 263

Sunita Khandelwal, Mumbai vs. PCIT(Central)-1, Mumbai

In the result, the grounds of appeal raised by the assessee are allowed

ITA 3539/MUM/2025[2016-17]Status: DisposedITAT Mumbai23 Dec 2025AY 2016-17

Bench: Shri Saktijit Dey & Shri Jagadish

For Appellant: Shri Ajay R. Singh &For Respondent: Shri Arun Kanti Datta – CIT(DR)

Section 132Section 142(1)Section 143(3)Section 153CSection 263

Sunita Khandelwal, Mumbai vs. PCIT(Central)-1, Mumbai

In the result, the grounds of appeal raised by the assessee are allowed

ITA 3451/MUM/2025[2015-16]Status: DisposedITAT Mumbai23 Dec 2025AY 2015-16

Bench: Shri Saktijit Dey & Shri Jagadish

For Appellant: Shri Ajay R. Singh &For Respondent: Shri Arun Kanti Datta – CIT(DR)

Section 132Section 142(1)Section 143(3)Section 153CSection 263

Estate of Vandravan P Shah, Mumbai vs. Assistant Commissioner of Income Tax, Circle 19(3), Mumbai

In the result all the three captioned appeals are dismissed

ITA 5403/MUM/2024[2017-18]Status: DisposedITAT Mumbai23 Dec 2025AY 2017-18

Bench: Sandeep Gosain () & Shri Om Prakash Kant ()

For Appellant: Ms. Shivani ShahFor Respondent: Mr. Hemanshu Joshi, Sr. DR

Section 132Section 143(3)Section 147Section 148Section 153CSection 159Section 35A

such action of the assessing officer is at the best be consider as difference of opinion and there was no concrete evidence of escapement of income for reopening of assessment under section 143(3). The contention of the appellant has been considered. I have gone through the facts and found ... added to the total income of Vandravan P Shah of AY 2012-13. 5. Basis of forming reason to believe and details of escapement of income: On the basis of the aforesaid information available with the undersigned, I have reason to believe that the assessee has escaped the income

Estate of Vandravan P Shah, Mumbai vs. Assistant Commissioner of Income Tax, Circle 19(3), Mumbai

In the result all the three captioned appeals are dismissed

ITA 5402/MUM/2024[2012-13]Status: DisposedITAT Mumbai23 Dec 2025AY 2012-13

Bench: Sandeep Gosain () & Shri Om Prakash Kant ()

For Appellant: Ms. Shivani ShahFor Respondent: Mr. Hemanshu Joshi, Sr. DR

Section 132Section 143(3)Section 147Section 148Section 153CSection 159Section 35A