“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

Jagdish Malhotra, New Delhi vs. ACIT, Circle-16(1), Jhandewalan

ITA 4546/DEL/2025[2012-13]Status: DisposedITAT Delhi26 Sept 2025AY 2012-13

Bench: Ms. Madhumita Roy & Shri Naveen Chandra

For Appellant: Sh. Gaurav Jain, Adv. &For Respondent: Sh. Shrikant Namdeo, CIT, DR

Section 142(1)Section 143(1)Section 143(2)Section 143(3)Section 147Section 148

case made out by the assessee as mentioned hereinabove, the reason recorded is required to be reproduced herein below: “Information received regarding escapement of Income Information was received from office of the Deputy Director of Income Tax (Inv.), Unit 2(4), Kolkata vide letter date 28.02.2019 received in this office ... recorded the reasons for his belief that the assessee had not fully and truly disclosed particulars of his income and hence there was escapement of income. Held that the reopening of the case was valid." 15.3 Also, in the case of Raymond Woollen Mills

Lexus Softmac, Surat vs. DCIT, Circle 1(1)(1), Surat

In the result, assessee’s appeal ITA No

ITA 703/SRT/2024[2015-16]Status: DisposedITAT Surat25 Sept 2025AY 2015-16

Bench: Ms. Suchitra Raghunath Kamble & Shri Bijayananda Prusethआयकर अपील सं./Ita Nos.702 & 703/Srt/2024 Ays: (2014-15 &2015-16) (Hybrid Hearing) Lexus Softmac, Deputy Commissioner Of F -3 To F-6, Gujarat Hira Bourse, Income-Tax, Circle 1(1)(1), बनाम/ Gems & Jewellery Park, Surat Room No.108, Vs. Ichchhapore, Aayakar Bhawan, Majura Surat - 394510 Gate, Opp. New Civil Hospital, Surat-395 001 "थायीलेखासं./जीआइआरसं./Pan/Gir No: Aabfl 0495 P (अपीलाथ"/Appellant) (""थ" /Respondent) िनधा"रती की ओर से /Appellant By Shri Deven K Kapadia, C.A. राज" की ओर से /Respondent By Shri Ajay Uke, Sr. Dr सुनवाई की तारीख/Date Of Hearing 19/08/2025 उद्घोषणा की तारीख/Date Of Pronouncement 25/09/2025

Section 143(3)Section 234ASection 250Section 271(1)(c)Section 69C

read to mean that the Assessing Officer should have finally ascertained the fact by legal evidence or conclusion. Whether material would conclusively proved escapement of income ITA Nos.702 & 703/SRT/2024/AYs 14-15 & 2015-16 Lexus Softmac is not the concern at that stage. In view of the facts discussed above

Lexus Softmac, Surat vs. DCIT, Circle1(1)(1), Surat

In the result, assessee’s appeal ITA No

ITA 702/SRT/2024[2014-15]Status: DisposedITAT Surat25 Sept 2025AY 2014-15

Section 143(3)Section 234ASection 250Section 271(1)(c)Section 69C

Naman Vidyapati Patel, Ahmedabad vs. The Pr.CIT, Central, Ahmedabad

In the result, the appeal of the assessee stands allowed

ITA 1008/AHD/2025[2021-22]Status: DisposedITAT Ahmedabad25 Sept 2025AY 2021-22

Bench: Shri Sanjay Garg & Annapurna Guptaआयकर अपील सं /Ita No.1008/Ahd/2025 िनधा"रण वष" /Assessment Year : 2021-22 Naman Vidyapati Patel The Pr.Cit (Central) बनाम/ M/S.Markettic Ahmedabad – 380 009 V/S. Mahalaxmi Compound Opp. Rustom Mills Dudheshwar Road Ahmedabad – 380 004 "थायी लेखा सं./Pan: Acopp 9233 C (अपीलाथ(/ Appellant) ()* यथ(/ Respondent) Assessee By : Shri S.N.Divatia, Ar & Shri Samir Vora, Ar Revenue By : Shri Alpesh Parmar, Cit-Dr सुनवाई की तारीख/Date Of Hearing : 30/07/2025 घोषणा की तारीख /Date Of Pronouncement: 25/09/2025 आदेश/O R D E R Per Sanjay Garg: The Present Appeal Preferred By The Assessee Is Against The Order Of Learned Principal Commissioner Of Income-Tax (Central), Ahmedabad [Hereinafter Referred To As “Ld. Pcit” For Short] Dated 27/03/2025 Passed In Exercise Of His Revision Jurisdiction Under Section 263 Of The Income-Tax Act, 1961 [Hereinafter Referred To As "The Act" For Short] For Assessment Year (Ay) 2021-22. Naman Vidyapati Patel Vs. The Pr.Cit Central Asst. Year : 2021-22

For Appellant: Shri S.N.Divatia, AR &For Respondent: Shri Alpesh Parmar, CIT-DR

Section 143(3)Section 263

taken the timely step to cancel the deed. Therefore, under the circumstances, at this stage, it is not a case of any escapement of income. At the most, it can be summed up that the assessee was clever enough to take the timely step of cancellation of deed to avoid

Bhavesh Jayanti Sondarwa, Mumbai vs. ITO Ward 19(1)(1), Mumbai

ITA 3009/MUM/2025[2017-18]Status: DisposedITAT Mumbai25 Sept 2025AY 2017-18

Bench: Shri Rahul Chaudhary (Jm) & Shri Omkareshwar Chidara (Am) Bhavesh Jayanti Sondarwa Ito Ward 19(1)(1) A/1, 6Th Floor, Room No. 603 Room No. 501 Samrat Ashok Chs, S.K. Vs. Piramal Chambers Rathod Marg, Ambedkar Lalbaug, Parel Nagar, Mahalaxmi Mumbai-400 012. Mumbai-400 034. Pan : Cnpps2949G Appellant Respondent

For Appellant: Shri Pravin SalunkheFor Respondent: Shri Navin Gandhi, CA

Section 147Section 148Section 148ASection 149(1)(a)Section 149(2)Section 56(2)(vii)Section 69

under section 148A(b) of the Act. The appellant challenged this show-cause notice, order under section 148A(d) dated 26.7.2022, notice of escapement of income under section 148 dated 26.7.2022 and reassessment proceedings alongwith reassessment order under section 147 of the Act by stating that the same

S K N Sikshan Sansthan, Bhadhadhar vs. Dy. Commissioner Income Tax (Central)-1, Jaipur

In the result, the appeal of the assessee is allowed

ITA 445/JPR/2025[2015-16]Status: DisposedITAT Jaipur24 Sept 2025AY 2015-16

Bench: Shri Gagan Goyal & Shri Narinder Kumarskn Shikshan Sansthan, 1, N. H. 11 Bhadhadar Sikar 332 315 Pan No.: Aamts 1103L ...... Appellant Vs.

For Appellant: Mr. Shafi Mohammad, Adv., Ld. ARFor Respondent: Mr. Gautam Singh Choudhary, Addl. CIT

Section 10Section 115BSection 12ASection 143(3)Section 147Section 148Section 250Section 57

there was shortage of potatoes in the market, those powers of survey were invoked. If nothing had been found therein which would indicate escapement of income and chargeable to tax then the basis for reopening ought not to be such survey actions and the report. Something more was required ... time of issuing unsigned reasons the AO had not mentioned anything as what was the basis of arriving at the conclusion of escapement of income, that also in the reasons recorded he had not mentioned that the escapement of income was due to failure of the assessee to disclose truly

Whole Sale Cloth Merchant Association, Kota vs. Deputy Commissioner of Income Tax Central Circle Kota, Kota

ITA 962/JPR/2024[2015-2016]Status: DisposedITAT Jaipur24 Sept 2025AY 2015-2016

For Respondent: Mrs. Anita Rinesh, JCIT-DR

Section 11Section 11(2)Section 143(3)Section 147Section 40

stage of issue of notice under section 148 what is required is only reason to believe but not the established fact of escapement of income. The proposition laid down by the Supreme Court clearly goes to establish that the Assessing Officer is not confined to the grounds or reasons stated

Whole Sale Cloth Merchant Association, Kota vs. Deputy Commissioner of Income Tax Central Circle Kota, Kota

In the result, the appeal of the assessee is allowed in ITA No

ITA 961/JPR/2024[2014-2015]Status: DisposedITAT Jaipur24 Sept 2025AY 2014-2015

For Appellant: Shri Siddharth Ranka, Adv

Section 11Section 11(2)Section 143(3)Section 147Section 40

stage of issue of notice under section 148 what is required is only reason to believe but not the established fact of escapement of income. The proposition laid down by 15 ITA No. 961 To 963/JPR/2024 Whole Sale Cloth Merchant Association, Kota. the Supreme Court clearly goes to establish that

Prasanna Prabhakaran L/H of Late Vasava Panicker Prabhakaran Kavintavadakkadath, Ahmedabad vs. The Income Tax Officer, Ward-3(3)(5), Ahmedabad

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

ITA 1741/AHD/2024[2013-14]Status: DisposedITAT Ahmedabad24 Sept 2025AY 2013-14

Bench: Shri Siddhartha Nautiyal & Shri Narendra Prasad Sinhaassessment Year: 2013-14

Section 147Section 148

alive and the issuance of valid notice conferred power upon the AO to assume jurisdiction for initiation of proceedings for assessment of escapement of income. It is a cardinal proposition in law that not issuing notice at all or issuing that beyond statutory period or issue of an invalid notice

Nikhil Baban Nimbalkar, Pune vs. ITO, Ward 14(5), Pune

In the result both appeals of the assessee are allowed for statistical purposes

ITA 2526/PUN/2024[2019-20]Status: DisposedITAT Pune24 Sept 2025AY 2019-20

Bench: Dr. Manish Borad & Shri Vinay Bhamoreआयकर अपील सं / Ita No.2525&2526/Pun/2024 धििेंारण वर्ा /Assessment Year: 2018-2019 & 2019-2020 Nikhil Baban Nimbalkar, Ito, Ward 14(5), Nimbalkar Hospital, Patas Pune Road, Baramati, Pune- Vs. 413102 Maharashtra Pan-Ajdpn1546Q अपीलेंर्थी / Appellant प्रत्यर्थी/Respondent Assessee By: Shri Pratik Sandbhor Department By: Shri Ramnath P Murkunde Date Of Hearing: 24-09-2025 Date Of Pronouncement: 06-10-2025 आदीश/Order Per Dr. Manish Borad:- This Appeal At The Instance Of The Assessee Is Directed Against The Order Of Ld. Cit(A), Nfac, Delhi Passed U/S 250 Of The Income-Tax Act, 1961 Dated 04.10.2024 Which Is Arising Out Of Order Passed U/S 147 R.W.S 144 Of The Act Dated 29.02.2024. 2. Assessee Has Raised Following Grounds Of Appeal In Ita No. 2525/Pun/2024:- 1. On The Facts & In The Circumstances Of The Case & In Law The Id. Cit(A) Erred In Not Granting Sufficient Opportunities Of Hearing & Dismissing The Appeal Ex-Parte 2. On The Facts & In The Circumstances Of The Case & In Law The Appellant Prays Before The Hon'Ble Bench To Kindly Grant An Opportunity To Represent The Matter Before The Ld Cit(A).

For Appellant: Shri Pratik SandbhorFor Respondent: Shri Ramnath P Murkunde

Section 147Section 148Section 250Section 404(3)

contentions and perused the records placed before us. We observe that the assessee is an individual and based on the information about alleged escapement of Income, re-assessment proceedings u/s 147 r.w.s. 144B of the Act were carried out for A.Y. 2018-19 and 2019-20 and against the returned

Nikhil Baban Nimbalkar, Pune vs. ITO, Ward 14(5), Pune

In the result both appeals of the assessee are allowed for statistical purposes

ITA 2525/PUN/2024[2018-19]Status: DisposedITAT Pune24 Sept 2025AY 2018-19

For Appellant: Shri Pratik SandbhorFor Respondent: Shri Ramnath P Murkunde

Section 147Section 148Section 250Section 404(3)

Exel Rubber Private Limited, Hyderabad vs. ACIT., Central Circle-1(2), Hyderabad

In the result, all the appeals of the assessee for the

ITA 1233/HYD/2025[2019-20]Status: DisposedITAT Hyderabad24 Sept 2025AY 2019-20

Bench: Shri Vijay Pal Rao, Vice-

For Appellant: Shri M.V. Prasad, CA

Section 132Section 143(3)Section 148Section 148BSection 149Section 149(1)(b)Section 151

/Rjt/2024 A.Ys16-17 to 19-20 Mukesh M.Sheth SCN. The reason and the belief as also the information leading to allegation of escapement of income must be clear and explicit at the initial stage itself prior to recording of the reasons and then issue of notice pursuant to the reasons

Ace Tyres Private Limited, Hyderabad vs. ACIT., Central Circle-1(2), Hyderabad

ITA 1207/HYD/2025[2019-20]Status: DisposedITAT Hyderabad24 Sept 2025AY 2019-20

Bench: Shri Vijay Pal Rao, Vice- & Shri Manjunatha, G.

For Appellant: Shri M.V.Prasad, CA

Section 132Section 143(3)Section 148Section 148BSection 149Section 149(1)(b)Section 151

learned DR Page 11 of 78 has submitted that the reasons recorded by the Assessing Officer clearly set out the nature of the escapement of income in the form of asset and entry/entries in the books of account. The learned DR has referred to the reasons recorded placed at Page

Exel Rubber Private Limited, K.V.Rangareddy vs. ACIT., Central Circle-1(2), Hyderabad

ITA 1109/HYD/2025[2018-19]Status: DisposedITAT Hyderabad24 Sept 2025AY 2018-19

Bench: Shri Vijay Pal Rao, Vice- & Shri Manjunatha, G.

For Appellant: Shri M.V. Prasad, CA

Section 132Section 143(3)Section 147Section 148Section 148BSection 149Section 149(1)(b)Section 151

Exel Rubber Private Limited, Hyderabad vs. DCIT., Central Circle-1(2), Hyderabad

ITA 1108/HYD/2025[2017-18]Status: DisposedITAT Hyderabad24 Sept 2025AY 2017-18

Bench: Shri Vijay Pal Rao, Vice- & Shri Manjunatha, G.

For Appellant: Shri M.V. Prasad, CA

Section 132Section 143(3)Section 147Section 148Section 148BSection 149Section 149(1)(b)Section 151

/Rjt/2024_A.Ys16-17 to 19-20 Mukesh M.Sheth SCN. The reason and the belief as also the information leading to allegation of escapement of income must be clear and explicit at the initial stage itself prior to recording of the reasons and then issue of notice pursuant to the reasons. The show

Exel Rubber Private Limited, Hyderabad vs. ACIT., Central Circle-1(2), Hyderabad

ITA 1106/HYD/2025[2015-16]Status: DisposedITAT Hyderabad24 Sept 2025AY 2015-16

For Appellant: Shri M.V. Prasad, CA

Section 132Section 143(3)Section 147Section 148Section 148BSection 149Section 149(1)(b)Section 151

ITA Nos 1106 to 1109 and 1233 of 2025 Exel Rubber Pvt Ltd आयकर अपीलीय अधिकरण, हैदराबाद पीठ IN THE

Ace Tyres Private Limited, Hyderabad vs. ACIT., Central Circle-1(2), Hyderabad

ITA 1088/HYD/2025[2018-19]Status: DisposedITAT Hyderabad24 Sept 2025AY 2018-19

Bench: Shri Vijay Pal Rao, Vice- & Shri Manjunatha, G.

For Appellant: Shri M.V.Prasad, CAFor Respondent: : Dr. Sachin Kumar, Sr. AR

Section 132Section 143(3)Section 148Section 148BSection 149Section 149(1)(b)Section 151

Thus, the learned DR has submitted that the reasons recorded by the Assessing Officer clearly set out the nature of the escapement of income in the form of asset and entry/entries in the books of account. The learned DR has referred to the reasons recorded placed at Page Nos.9

Ace Tyres Private Limited, Hyderabad vs. DCIT., Central Circle-1(2), Hyderabad

ITA 1087/HYD/2025[2017-18]Status: DisposedITAT Hyderabad24 Sept 2025AY 2017-18

Bench: Shri Vijay Pal Rao, Vice- & Shri Manjunatha, G.

Section 132Section 143(3)Section 148Section 148BSection 149Section 149(1)(b)Section 151

Ace Tyres Private Limited, Hyderabad vs. ACIT., Central Circle-1(2), Hyderabad

ITA 1086/HYD/2025[2016-17]Status: DisposedITAT Hyderabad24 Sept 2025AY 2016-17

Bench: Shri Vijay Pal Rao, Vice- & Shri Manjunatha, G.

For Appellant: Shri M.V.Prasad, CAFor Respondent: : Dr. Sachin Kumar, Sr. AR

Section 132Section 143(3)Section 148Section 148BSection 149Section 149(1)(b)Section 151

Ace Tyres Private Limited, Hyderabad vs. ACIT., Central Circle-1(2), Hyderabad

ITA 1085/HYD/2025[2015-16]Status: DisposedITAT Hyderabad24 Sept 2025AY 2015-16

Bench: Shri Vijay Pal Rao, Vice- & Shri Manjunatha, G.आ.अपी.सं / Ita Nos.1084 To 1088 & 1027/Hyd/2025 (निर्धारण वर्ष/Assessment Years: 2014-15 To 2019-20)

For Appellant: Shri M.V.Prasad, CAFor Respondent: : Dr. Sachin Kumar, Sr. AR

Section 132Section 143(3)Section 148Section 148BSection 149Section 149(1)(b)Section 151