“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

Muhammed Arif Shaikh, Vejalpur vs. Asst. Unit. Income Tax Dept. (Present Juri. - ITO, Ward 3(3)(2) Ahmedabad), Vejalpur

In the result, the appeal filed by the Assessee is hereby allowed

ITA 1806/AHD/2025[2018-19]Status: DisposedITAT Ahmedabad25 Feb 2026AY 2018-19

Bench: DR. BRR Kumar (Vice President), Shri T. R. Senthil Kumar (Judicial Member)

Section 131Section 143Section 143(1)Section 147Section 148Section 148A

assessee as per provisions of section 148A(b) of the Act to show cause why the transactions may not be treated as escapement of income. However, the assessee failed to explain the above transactions, therefore order u/s.148A[d] of the Act dated 31-03- 2022 was passed that unexplained transaction

Chandrakant Patel, Ahmedabad vs. The ITO, Ward-3(3)(6), Ahmedabad

In the result, the appeal filed by the Assessee is dismissed

ITA 1468/AHD/2025[2011-12]Status: DisposedITAT Ahmedabad25 Feb 2026AY 2011-12

Bench: DR. BRR Kumar (Vice President), Shri T. R. Senthil Kumar (Judicial Member)

Section 143(3)Section 148Section 271(1)(c)

Rs.77,75,31,930/- during Asst. Year 2011-12 and not filed the Return of Income. Therefore notice u/s. 148 was issued for escapement of income. The additions made by the assessing officer are as follows: “The assessees contention that he has only acted as a broker on behalf

Jadagadder Pakkerappa, Legal Heir Sarojamma, Shikaripura vs. Income Tax Officer, Ward-1 & Tps, Shimoga

In the result, appeal filed by the assessee is allowed

ITA 1406/BANG/2025[2016-17]Status: DisposedITAT Bangalore25 Feb 2026AY 2016-17

Bench: Shri Waseem Ahmed & Shri Keshav Dubeyassessment Year : 2016-17

For Appellant: Sri Varun Bhat, A.RFor Respondent: Sri Balusamy N., D.R

Section 142(1)Section 144Section 147Section 148Section 15Section 250

deceased if he had survived. 14. In the present facts, admittedly, the proceedings are initiated under section 148 for reassessment relating to escapement of income of late Kurkal Gopal Shetty and such proceedings as has been initiated in the year 2018 by when Kurkal Gopal Shetty had already died

Basaveshwer Devalay English Medium Higher Primary School Basavanabagewadi, Bijapur vs. Income Tax Officer, Ward-1 & Tps, Bijapur

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

ITA 1409/BANG/2025[2016-17]Status: DisposedITAT Bangalore24 Feb 2026AY 2016-17

Bench: Shri Prashant Maharishi, Vice – & Shri Soundararajan K.

Section 10Section 139(1)Section 142(1)Section 143(2)Section 148Section 148ASection 271(1)(b)Section 271F

IN THE INCOME TAX APPELLATE TRIBUNAL 'A' BENCH : BANGALORE BEFORE SHRI PRASHANT MAHARISHI, VICE – PRESIDENT AND SHRI SOUNDARARAJAN K., JUDICIAL

Shailesh Asalraj Jain, Mumbai vs. Principal Commissioner of Income Tax, Mumbai 20, Mumbai

In the result, the appeal of the assessee is allowed

ITA 2559/MUM/2025[2018-2019]Status: DisposedITAT Mumbai24 Feb 2026AY 2018-2019

Bench: Shri Om Prakash Kant () & Shri Rahul Chaudhary () Assessment Year: 2018-19

For Appellant: Mr. Devendra JainFor Respondent: 03/12/2025

Section 147Section 148ASection 263

inquiry and verification which should have been made to detailed inquiry and verification which should have been made to examine the issue of escapement of income and that the action of examine the issue of escapement of income and that the action of examine the issue of escapement of income ... verification which should have bee should have been made to examine the issues of escapement of n made to examine the issues of escapement of income. 8. In view of the above discussion from Para 1 to 7, it is evident that 8. In view of the above discussion from

Palak Designer Diamond Jewellery, Mahidharpura, Surat vs. Ld. AO, NFAC, Delhi

In the result, the appeal of the assessee for AY 2016-17 is dismissed

ITA 955/SRT/2024[2018-19]Status: DisposedITAT Surat23 Feb 2026AY 2018-19

Bench: Dr. B.R.R. Kumar, Vice-Ms. Suchitra Kamble

Section 147Section 148Section 250

even a partner of the assessee firm. According to the assessee, there was no live nexus between the alleged jewellery valuation and escapement of income. The assessee relied on the following case-laws:- ITA Nos. 953 to 955/SRT/2024 Palak Designer Diamond Jewellery Vs. ITO Asst. Year

Palak Designer Diamond Jewellery, Mahidharpura, Surat vs. Ld. AO, NFAC, Delhi

In the result, the appeal of the assessee for AY 2016-17 is dismissed

ITA 954/SRT/2024[2017-18]Status: DisposedITAT Surat23 Feb 2026AY 2017-18

Bench: Dr. B.R.R. Kumar, Vice-Ms. Suchitra Kamble

Section 147Section 148Section 250

Palak Designer Diamond Jewellery, Mahidharpura Surat vs. Ld. AO, NFAC, Delhi

In the result, the appeal of the assessee for AY 2016-17 is dismissed

ITA 953/SRT/2024[2016-17]Status: DisposedITAT Surat23 Feb 2026AY 2016-17

Bench: Dr. B.R.R. Kumar, Vice-Ms. Suchitra Kamble

Section 147Section 148Section 250

Rita Anil Kapoor, Mumbai vs. Income Tax Officer Ward 19(2)(4), Mumbai

In the result, the appeal is allowed

ITA 6640/MUM/2025[2013-14]Status: DisposedITAT Mumbai23 Feb 2026AY 2013-14

Bench: Shri Saktijit Dey & Shri Makarand Vasant Mahadeokarrita Anil Kapoor National Faceless Assessment Rowhouse No. 6, Grand Paradi, Centre, Delhi August Kranti Marg, Kemps Corner, Vs. [Present Jurisdiction Income-Tax Mumbai-400 036 Officer Ward 19(2)(4)-Mumbai] Pan/Gir No. Atvpk 7073 K (Appellant) : (Respondent) Appellant By : Shri M. P. Lohia Respondent By : Shri Annavaram Kosuri Date Of Hearing : 18.02.2026 Date Of Pronouncement : 23.02.2026 O R D E R Per Saktijit Dey: The Present Appeal By The Assessee, Arises Out Of Order Dated 19.08.2025 Passed By National Faceless Appeal Centre (‘Nfac’ For Short), Delhi For The Assessment Year (A.Y. For Short) 2013-14. 2. The Solitary Issue On Merit Is Concerning The Addition Of An Amount Of Rs.6,60,37,500/- U/S. 69 Of The Act, Representing Alleged Unexplained Investment In Purchase Of Immovable Property.

For Appellant: Shri M. P. LohiaFor Respondent: Shri Annavaram Kosuri

Section 147Section 69

year under consideration, the assessee had purchased an immovable property investing huge amount. Whereas, she had not filed any return of income. Alleging escapement of income, the A.O. reopened the assessment u/s. 147 of the Act. In course of assessment proceeding, the A.O. called upon the assessee to explain

Ronak Ashok Shah, Mumbai vs. ITO Ward 41(3)(3), Mumbai

In the result, the appeal is allowed for statistical purpose

ITA 6639/MUM/2025[2018-19]Status: DisposedITAT Mumbai23 Feb 2026AY 2018-19

Bench: Shri Saktijit Dey & Shri Makarand Vasant Mahadeokarronak Ashok Shah Ito-41(3)(3) 1803, Raj Hans Apt., Kautilya Bhavan, Jitendra Road, Malad (E) Vs. Mumbai Mumbai-400 097 Pan/Gir No. Bdjps 9744 J (Appellant) : (Respondent) Appellant By : Shri Rajesh Kothari Respondent By : Shri Annavaram Kosuri (Sr. Ar) Date Of Hearing : 18.02.2026 Date Of Pronouncement : 23.02.2026 O R D E R Per Saktijit Dey: This Is An Appeal By The Assessee Against Order Dated 10.03.2025, Passed By National Faceless Appeal Centre (‘Nfac’ For Short), Delhi For The Assessment Year (A.Y. For Short) 2018-19. 2. In Ground No. 1, The Assessee Has Raised Grievance Against The Ex Parte Disposal Of The Appeal By Ld. First Appellate Authority. Whereas, Ground Nos. 2 To 5 Are On The Issue Of Validity Of Reopening Of Assessment. Ground Nos. 6 & 7 Are On The Authority Of The Jurisdictional Assessing Officer (Jao) In Completing The Assessment. Whereas, Ground Nos. 8 To 11 Are On Merits.

For Appellant: Shri Rajesh KothariFor Respondent: Shri Annavaram Kosuri (Sr. AR)

Section 139(1)Section 147Section 148

assessee, they were found to be penny stock companies. Since, the assessee was a non-filer of income tax return, the A.O. alleging escapement of income, reopened the assessment u/s. 147 of the Act. In response to notice issued u/s. 148 of the Act, the assessee furnished his return ... reopening of assessment u/s. 147 of the Act is wholly without jurisdiction, as the reasons recorded do not make out a case of escapement of income. He further submitted, without providing reasonable opportunity of being heard, ld. First appellate authority decided the appeal ex parte by dismissing all the grounds

DCIT, Central Circle 7(1), Mumbai vs. Balaji Bullions and Commodities India Private Limited, Mumbai

ITA 3915/MUM/2025[2017]Status: DisposedITAT Mumbai23 Feb 2026

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal ()

Section 131Section 133ASection 143(1)Section 147Section 148

what is required is the existence of a “reason to believe” based on prima-facie material, and not conclusive proof of escapement of income at the stage of issuance of notice. Reliance was placed on settled principles governing reassessment, noting that the sufficiency or correctness of the material cannot ... assessment. 7.2 The expression “reason to believe” postulates the existence of tangible material having a rational connection with the formation of belief regarding escapement of income. The belief must be that of a reasonable person based on relevant material; it cannot be arbitrary, mechanical, or based on mere suspicion

Balaji Bullions and Commodities India Private Limited, Mumbai vs. DCIT Central Circle 7(1), Mumbai

The appeal of the Revenue is allowed for statistical purposes

ITA 3755/MUM/2025[2017-18]Status: DisposedITAT Mumbai23 Feb 2026AY 2017-18

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal () Assessment Year: 2017-18

For Appellant: Shri Sharwan Kumar Jha, Adv

Section 133ASection 143(1)

facie material, and not conclusive proof of escapement of material, and not conclusive proof of escapement of material, and not conclusive proof of escapement of income at the stage o income at the stage of issuance of notice. Reliance was placed on f issuance of notice. Reliance was placed ... tangible material having a rational connection with the formation of tangible material having a rational connection with the formation of belief regarding escapement of income. The belief must be that of a g escapement of income. The belief must be that of a g escapement of income. The belief must

Chandra Khilwani, Vadodara vs. Income Tax Officer, Ward 3(1)(4), Vadodara, Aayakar Bhavan, Baroda

In the result, the appeal filed by the Assessee is hereby allowed

ITA 2234/AHD/2025[2019-20]Status: DisposedITAT Ahmedabad20 Feb 2026AY 2019-20

Bench: Shri T.R. Senthil Kumar (Judicial Member), Shri Narendra Prasad Sinha (Accountant Member)

Section 133ASection 147Section 148Section 148A

purchase of shop no. 19 and other income not disclosed by the assessee. Therefore it is a fit case to issue notice for escapement of income for the Asst. Year 2019-20 and issued notice u/s. 148 of the Act. The assessing officer completed the reassessment by making assessed income

Rohitkumar Chinubhai Modi, Ahmedabad vs. The ACIT, Cir. 5(2) Now DCIT, Circle-2(1)(1), Ahmedabad

The appeal of the assessee is hereby dismissed

ITA 1961/AHD/2025[2009-10]Status: DisposedITAT Ahmedabad20 Feb 2026AY 2009-10

Bench: Shri Siddhartha Nautiyal & Shri Narendra Prasad Sinha

For Appellant: Shri Satish Solanki, ARFor Respondent: Shri Yogesh Mishra, Sr. DR

Section 143(3)Section 147Section 148Section 263

judicial precedents, the CIT(Appeals) observed that at the stage of reopening, it is not necessary for the Assessing Officer to conclusively establish escapement of income and that prima facie material is sufficient. Accordingly, the grounds challenging the validity of reopening were dismissed. ITA Nos. 1961 & 1960/Ahd/2025 Rohitkumar Chinubhai Modi ... believe that income chargeable to tax had escaped assessment. At the stage of reopening, the Assessing Officer is not required to conclusively prove escapement of income. It is sufficient if there exists prima facie material leading to formation of such belief. This legal position is well settled

Saurabhbhai Rohitbhai Modi, Ahmedabad vs. The ACIT, Cir. 5(2) Now DCIT, Circle-2(1)(1), Ahmedabad

The appeal of the assessee is hereby dismissed

ITA 1960/AHD/2025[2009-10]Status: DisposedITAT Ahmedabad20 Feb 2026AY 2009-10

Bench: Shri Siddhartha Nautiyal & Shri Narendra Prasad Sinha

For Appellant: Shri Satish Solanki, ARFor Respondent: Shri Yogesh Mishra, Sr. DR

Section 143(3)Section 147Section 148Section 263

Prafulla Kumar Malakar, Income Tax Officer, Ward-12(1), Kolkata vs. Kalawati Investments & Trading P Ltd., Kolkata

In the result, the appeal filed by the Revenue is dismissed

ITA 134/KOL/2025[2015-16]Status: DisposedITAT Kolkata20 Feb 2026AY 2015-16

Bench: Shri George Mathan & Shri Rakesh Mishra

Section 144Section 147Section 148Section 250Section 69

platform of BSE & USE. The nature & source of such transactions remained unexplained and hence the AO had reason to believe that there was escapement of income. After recording reasons in writing & obtaining prior approval of the competent authority, the AO initiated action u/s 148 of the Act and subsequently passed ... platform of BSE & USE. The nature & source of such transactions remained unexplained and hence the AO had reason to believe that there was escapement of income. Accordingly, the case was re-opened u/s 147 of the Act and notice u/s 148 of the Act was issued to the appellant company

ACIT, CC 6(2), Mumbai vs. Overseas Infrastructure Alliance (India) Private Limited, Mumbai

In the result, appeal by the assessee is allowed

ITA 4321/MUM/2025[2016-17]Status: DisposedITAT Mumbai20 Feb 2026AY 2016-17

Bench: Shri Sandeep Gosain & Shri Girish Agrawal

For Appellant: Shri Harsh Kothari and Shri Ronak Vasavada, CAsFor Respondent: Shri R. A. Dhyani, CIT DR and Shri Virabhadra S. Mahajan, Sr. DR

Section 1

Hence, after1.4.1989, the 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. This is supported by Circular No.549 dated 31.10.1989 which clarified