“borrowed satisfaction”

ReassessmentSection 147Section 1471,326 judgments

The decision most relied on for borrowed satisfaction is PCIT v. Meenakshi Overseas Pvt. Ltd. (395 ITR 677), cited in 471 judgments on BharatTax.

Leading authorities on borrowed satisfaction

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.

394 ITR 146 (Guj.) 2. Varshaben S. Patel v. ITO

338 ITR 51 · 2011 · High Court

295

citing judgments

Reasons for reopening an assessment must be specific and not vague, scanty, or based on borrowed satisfaction. The Assessing Officer must quantify the escaped income.

222 Taxman 15 (Gujarat)(MAG.), Principal Commissioner of Income-tax-4 v. G & G Pharma India Ltd.

384 ITR 147 · 2016 · High Court

274

citing judgments

An assessment can be reopened if there is tangible material indicating escapement of income, demonstrating a live link between the material and the reasons recorded for reopening. The Assessing Officer must apply their mind to the material facts, and the sanction under section 151 should not be based on borrowed satisfaction.

CIT v. SFIL Stock Broking Ltd.

325 ITR 285 · 2010 · High Court

243

citing judgments

Reassessment proceedings under Section 147 are invalid and void ab initio if initiated based on 'borrowed satisfaction' without the Assessing Officer's independent application of mind, or merely on documents already available on record without fresh tangible material.

Sarthak Securities Co. Pvt. Ltd. v. ITO

329 ITR 110 · 2010 · High Court

217

citing judgments

Reassessment proceedings under Section 147 are invalid if the Assessing Officer records satisfaction based on borrowed satisfaction or information without independently applying their mind and forming their own 'reason to believe' that income has escaped assessment. The AO must arrive at an independent conclusion, not merely act on a report from an investigation wing without due diligence.

ITO v. Selected Dalurband Coal Co. (P.) Ltd.

217 ITR 597 · 1996 · Supreme Court

180

citing judgments

The Assessing Officer's belief that income has escaped assessment, leading to the reopening of an assessment, is a matter of subjective satisfaction. The materials available at the time of forming this belief do not need to conclusively prove the escapement of income.

CIT v. SPL’s Siddhartha Ltd.

345 ITR 223 · 2012 · High Court

164

citing judgments

Reassessment proceedings under Section 147 are invalid if the sanction required under Section 151 is obtained mechanically, without independent application of mind by the sanctioning authority, or is based on borrowed satisfaction.

CIT v. Atul Jain

299 ITR 383 · 2008 · High Court

147

citing judgments

Reassessment proceedings under section 147 are not valid if the information relied upon by the Assessing Officer is vague, scanty, and lacks specific details linking it to the assessee's transactions.

Judgments citing borrowed satisfaction

Ashok Kumar, Merrut vs. ITO, Meeut

In the result, the appeal of the assessee is partly allowed as indicated above

ITA 5090/DEL/2025[2011-12]Status: DisposedITAT Delhi17 Feb 2026AY 2011-12

Bench: Shri C.N. Prasadassessment Year 2011-12 Asok Kumar S/O Sher Singh Vs. Ito 24, Nagli, Azamabad Ward -1 (1) Meerut -250001 Meerut Pan No.Blapk3060J Appellant Respondent Appellant Sh. Manish Kumar, Advocate Respondent Sh. Manoj Kumar, Sr. Dr

Section 142Section 148

appreciating that in the instant proceedings the satisfaction of the A.O recorded before issuance of alleged notice u/s 148 is totally based on borrowed satisfaction on account of the fact that for A.Y 2011-12 no proceedings was pending concerning the assessee and therefore, for the purpose of enquiry notice

Shree Krishna Udyog, Raipur vs. Income Tax Officer, Ward-1(1), Raipur

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

ITA 841/RPR/2025[2018-19]Status: DisposedITAT Raipur16 Feb 2026AY 2018-19

Bench: Shri Partha Sarathi Chaudhury, Jm & Shri Avdhesh Kumar Mishra, Am आयकर अपील सं. / Ita No: 841/Rpr/2025 (िनधा"रण वष" Assessment Year: 2018-19) Shree Krishna Udyog, 17A, Vs Income Tax Officer, Ward 1(1), Bhanpuri Industrial Area, Aaykar Bhawan, Civil Lines, Raipur, Chhattisgarh, 492010 Raipur Chhattisgarh, 492001 Pan: Aapfs5659E (अपीलाथ"/Appellant) (""थ" / Respondent) : िनधा"रती की ओर से / Assessee By : Shri G. S. Agrawal, Ca राज" की ओर से / Revenue By : Dr. Priyanka Patel, Sr. Dr सुनवाई की तारीख / Date Of Hearing : 10/02/2026 घोषणा की तारीख / Date Of : 16/02/2026 Pronouncement आदेश / O R D E R Per Avdhesh Kumar Mishra, Am:

For Appellant: Shri G. S. Agrawal, CAFor Respondent: Dr. Priyanka Patel, Sr. DR

Section 145Section 147aSection 148ASection 148A(1)(a)Section 148A(1)(d)Section 151Section 250

cross-examine the vendor and the order was bad in law, without any specific information against the appellant and on the basis of borrowed satisfaction. However, as already discussed, the appellant remained non-compliant during the course of appeal proceedings and has not provided any clarification on these issues raised

Jadav Jewellers Pvt. Ltd., Chennai vs. ITO, Corporate Ward-2(3), Chennai

The appeal of the assessee is allowed

ITA 2911/CHNY/2025[2013-14]Status: DisposedITAT Chennai16 Feb 2026AY 2013-14

Bench: Shri Aby T. Varkey & Ms. Padmavathy.Sआयकर अपील सं./Ita No.2911/Chny/2025 िनधा"रण वष" /Assessment Year: 2013-14

For Appellant: Mr. D. Anand, AdvocateFor Respondent: Ms. R. Anitha, Addl. CIT

Section 143(3)Section 144BSection 147Section 148Section 154Section 250Section 68

reason to believe that income had escaped assessment and that the Jadav Jewellers Pvt. Ltd. :- 2 -: reopening was based on borrowed satisfaction and mere information received from another officer without any independent application of mind. 3. The Learned CIT(A) erred in holding that the reassessment was validly initiated under

M/S. Armstrong Energy Pvt Ltd, Mumbai vs. The DCIT 6(1)(1), Mumbai

ITA 3395/MUM/2025[2008-09]Status: DisposedITAT Mumbai16 Feb 2026AY 2008-09

Bench: Hon’Ble Shri Sandeep Gosain & Hon’Ble Shri Prabhash Shankarm/S Armstrong Energy Pvt. Vs. Dcit 6(1) (1), Mumbai Ltd. Room No. 504, 5Th 5Th Floor, Militia Apartment, Floor, Aayakar Bhavan, Mathur Pakhadi Road, M.K. Road, Mazgaon, Mumbai 400020 Mumbai - 400010 Pan/Gir No. Aafca3807R (Applicant) (Respondent) Acit 6(1) (1), Mumbai Vs. M/S Armstrong Energy Pvt. Room No. 504, 5Th Floor, Ltd. Aayakar Bhavan, M.K. 5Th Floor, Militia Road, Apartment, Mathur Mumbai 400020 Pakhadi Road, Mazgaon, Mumbai - 400010 Pan/Gir No. Aafca3807R (Applicant) (Respondent) Assessee By Shri Nishit Gandhi Revenue By Shri Rajesh Kumar Yadav (Cit-Dr) Date Of Hearing 10.12.2025 Date Of Pronouncement 16.02.2026 आदेश / Order Per Sandeep Gosain, Jm: M/S. Armstrong Energy Pvt. Ltd.

Section 143(1)Section 143(3)Section 144Section 147Section 148Section 151(2)Section 251(1)(a)Section 68

merely on the basis of information received by his office M/s. Armstrong Energy Pvt. Ltd. from DGIT (Inv.), Mumbai, which is nothing more than borrowed satisfaction as there was no independent finding of the Ld. A.O. before issuing the notice

ACIT-6(1)(1), Mumbai vs. Armstrong Energy Pvt. Ltd., Mumbai

ITA 2940/MUM/2025[2008-09]Status: DisposedITAT Mumbai16 Feb 2026AY 2008-09

Section 143(1)Section 143(3)Section 144Section 147Section 148Section 151(2)Section 251(1)(a)Section 68

Multi Mantech International Private Limited, Ahmedabad vs. DCIT Circle 17(1), New Delhi

In the result, appeal of assessee in ITA No

ITA 3480/DEL/2023[2014-15]Status: DisposedITAT Delhi16 Feb 2026AY 2014-15

Bench: Shri Satbeer Singh Godara & Shri Naveen Chandra

For Appellant: Shri Pallav, CAFor Respondent: Shri Ankush Kalra, Sr. DR

Section 12ASection 142(1)Section 143(2)Section 143(3)Section 14ASection 35Section 35(1)(ii)Section 80G

avail any opportunities to furnish its explanation on this issue. It is argued that at this juncture before the ITAT, raising the issue of borrowed satisfaction and cross examination is no more relevant. 14. We have heard the rival submissions and have perused the materials on record. We find that

Nilesh Ashanand Thacker, Bhuj vs. ITO Ward 4, Gandhidham (Bhuj)

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

ITA 377/RJT/2025[2012-13]Status: DisposedITAT Rajkot13 Feb 2026AY 2012-13

Bench: Dr. Arjun Lal Saini & Shri Dinesh Mohan Sinhaआयकर अपील सं./Ita No.377/Rjt/2025 (िनधा"रण वष" /Assessment Year: (2012-13) (Physical Hearing) Nilesh Ashanand Thacker, बनाम Income-Tax Officer, Ward-4, / Near-Laxmi Vekari Mahakali Gandhidham (Bhuj-2)-370 201 Vs. Shopping Mall, Jublee Circle, Bhuj, Kutch-300 001(Gujarat) "ायीलेखासं./जीआइआरसं./Pan/Gir No.: Adhpt 8610R (अपीलाथ"/ Appellant) (""थ"/Respondent)

For Appellant: Shri Kalpesh Doshi, ARFor Respondent: Shri Abhimanyu Singh Yadav, Sr. DR

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

Court held that while recording satisfaction, the designated authority must reflect independent application of mind and not merely a borrowed satisfaction. The approval is given by simply relying on reasons without applying mind and recording objective satisfaction stating documents perused, conclusion drawn based on report, return of income filed ... which reasons are recorded. There is no objective satisfaction recorded by approving authority which reflects that there is application of mind and not borrowed satisfaction of assessing officer (AO). The ld Counsel also relied on the judgement of Hon’ble Rajkot Tribunal in case of Shri Dhanji Murji Hirani

Nirman, Ahmedabad vs. DCIT, Circle-2(1)(1), Ahmedabad

In the result, the appeal of the assessee is allowed

ITA 1509/AHD/2025[2014-15]Status: DisposedITAT Ahmedabad13 Feb 2026AY 2014-15

Bench: Dr. B.R.R. Kumar, Vice-Shri Siddhartha Nautiyalnirman, Vs. 35, Vasantkunj Society, New Dcit, Sharda Mandir Road, Paldi, Circle-2(1)(1), Ahmedabad-380007 Ahmedabad [Pan :Aabfn 7155 L] (Appellant) .. (Respondent) Appellant Represented By : Shri Parin Shah, Ar Respondent Represented By: Shri C. Dharani Nath, Sr Dr Date Of Hearing 03.02.2026 Date Of Pronouncement 13.02.2026 O R D E R Per Dr. B.R.R. Kumar, Vice-:-

Section 132Section 148Section 250Section 69A

assessee is now in appeal before the Tribunal. 9. Before us, the Ld. AR submitted that the reopening was based on borrowed satisfaction without independent application of mind by the Assessing Officer. It was also submitted that the addition was made merely on the basis of general investigation reports without ... been issued, bank account in which the cheques have been encashed are flagrantly missing. Such reopening, based on vague and non-specific information, reflects borrowed satisfaction and not an independent formation of belief as required under section 147 of the Act. 11.1 We also find blatant inconsistencies in the stand

Mithlesh Amarnath Maurya, Navi Mumbai vs. Ward 28(2)(1), Mumbai, Vashi

The appeal of the assessee is allowed

ITA 7731/MUM/2025[2013-14]Status: DisposedITAT Mumbai13 Feb 2026AY 2013-14

Bench: Shri Saktijit Dey & Shri Makarand Vasant Mahadeokarmithlesh Amarnath Ito Ward-28(2)(1), Maurya It Office, Vasi Flat No.302, Plot No. 17 & Vs. Railway Station 18, Hari Darshan Chs, Building, Navi Sector-9, Ulve, Mumbai-400 703 Maharashtra-410 206, Navi Mumbai Pan/Gir No. Asxpm2717M (Applicant) (Respondent) Assessee By Ms. Prajakta Arote, Ld. Ar Revenue By Shri Annavaram Kosuri, Ld. Dr Date Of Hearing 10.02.2026 Date Of Pronouncement 13.02.2026

Section 142(1)Section 144Section 144BSection 147Section 148

reopening the assessment u/s 147 without recording an independent “reason to believe” that income had escaped assessment. The reopening is based purely on borrowed satisfaction from information received from the Investigation Wing regarding M/s Bhagwati Developers, without any direct nexus with the appellant. 5 Mithlesh Amarnath Maurya B. Section

Surat Goods Transport Pvt Ltd, Mumbai vs. DCIT Circle 16(2), Mumbai

ITA 7556/MUM/2025[2018-19]Status: DisposedITAT Mumbai13 Feb 2026AY 2018-19

Bench: Smt. Beena Pillai, Jm & Shri Arun Khodpia, Am

Section 143(3)Section 144Section 144BSection 147Section 148Section 148ASection 154Section 68

erred in uploading validity of the reopening notice u/s 148 r.w.s. 148A of the Act has been issued on the basis of the borrowed satisfaction of the DDIT whereby the statement of Shri Rajesh G. Mehta was recorded and used against the appellant. [Refer Bombay High Court in the case

Amit Prabhunath Jaiswal, Navi Mumbai vs. ITO Ward -28(1)(1), Mumbai

In the result, the appeal is allowed with cost for statistical

ITA 5280/MUM/2025[2017-2018]Status: DisposedITAT Mumbai12 Feb 2026AY 2017-2018

Bench: Shri Sandeep Gosain

For Respondent: Shri Surendra Mohan, (Sr. DR)

Section 143(3)Section 147Section 148Section 148ASection 151Section 153CSection 68

business transactions but simply proceeded to initiate proceedings on the basis of information received which is nothing but a classic case of borrowed satisfaction recorded to initiate proceedings u/s 147 is not valid. Thus, such action fallacious assumption, without reason to believe, without own application of mind on the part ... while recording the reason and JAO has initiated proceedings on the basis of information received which is nothing but a classic case of borrowed satisfaction is liable to be quashed. 9. The learned AO has erred in issuing the Demand Notice u/s 156 of the Act before passing the assessment

Sanjay Rawat, Dehradun vs. ACIT Central Cricle, Dehradun

In the result, appeal of the assessee is allowed

ITA 95/DDN/2024[2013-14]Status: DisposedITAT Dehradun11 Feb 2026AY 2013-14

Bench: Shri Yogesh Kumar U.S & Shri Manish Agarwal[Through Virtual Mode] Ita Nos.90, 95 & 104/Ddn/2024 [Assessment Years : 2015-16, 2013-14 & 2013-14] Sanjay Rawat Vs Acit 18S Ats Colony, Central Circle Sahastradhara Road, Dehradun, Dehradun, Uttarakhand-248001 Uttarakhand Pan-Ahopr5244E Appellant Respondent Assessee By Shri Ajay Wadhwa, Adv. Shri Shivam Garg, Adv. & Shri Raghav Sharma, Ca Revenue By Ms. Poonam Sharma, Cit Dr Date Of Hearing 08.12.2025 Date Of Pronouncement 11.02.2026 Order Per Manish Agarwal, Am :

Section 139(1)Section 142(1)Section 143(2)Section 147Section 148Section 151Section 250Section 271

action of the Ld AO of reopening of the impugned case as the same was done on the basis of wrong facts and borrowed satisfaction without application of independent mind. 4. On the facts and circumstances of the case, Ld. CIT(A) has erred in affirming the jurisdiction ... believe and the re-assessment proceedings so initiated, is invalid. 9. Ld.AR further submits that AO has recorded the reasons on the basis of borrowed satisfaction, based on the information received from Investigation Wing in the case of Amit Sharma, Ram Asrey Sharma Group and no independent inquiry or verification

Sanjay Rawat, Dehradun vs. ACIT Central Circle, Dehradun

In the result, appeal of the assessee is allowed

ITA 90/DDN/2024[2015-16]Status: DisposedITAT Dehradun11 Feb 2026AY 2015-16

Section 139(1)Section 142(1)Section 143(2)Section 147Section 148Section 151Section 250Section 271

Sh.Sanjay Rawat, Dehradun vs. ACIT, Circle, Dehradun

In the result, appeal of the assessee is allowed

ITA 104/DDN/2024[2013-14]Status: DisposedITAT Dehradun11 Feb 2026AY 2013-14

Section 139(1)Section 142(1)Section 143(2)Section 147Section 148Section 151Section 250Section 271

Shri Suchha Singh Through L/R Ranjit Singh, Kaputhalla vs. Principal Commissioner of Income Tax -1, Jalandhar

ITA 36/ASR/2021[2011-12]Status: HeardITAT Amritsar11 Feb 2026AY 2011-12

Bench: Hon’Ble Shri Manoj Kumar Aggarwal, Am & Shri Udayan Dasgupta, Jm

For Appellant: Sh. Sandeep Vijh (CA) – Ld. ARFor Respondent: Sh. Farhat Khan (Ld. CIT) - DR

Section 133(6)Section 142(1)Section 143(3)Section 148Section 263

allegation of escapement of income. There was no material to record to make belief of escapement of income. The reassessment was initiated on mere borrowed satisfaction and therefore, the order could not be subjected to revision u/s 263. The assessee denied having undertaken any such transaction. This being

H J Enterprise, Rajkot vs. ACIT, Circle-1(1), Rajkot

In the result, the appeal of the assessee is partly allowed, in above terms

ITA 543/RJT/2025[2009-10]Status: DisposedITAT Rajkot11 Feb 2026AY 2009-10

Bench: Dr. Arjun Lal Saini & Dr. Dinesh Mohan Sinha

For Appellant: Shri Mehul Ranpura, Ld. A.RFor Respondent: Shri Abhimanyu Singh Yadav, Ld. Sr. DR

Section 143(3)Section 147Section 148Section 44ASection 68Section 69C

income of the beneficiaries for assessment year 2009-10. It was alleged that the appellant was one of beneficiary of transactions. On the aforesaid borrowed satisfaction, the AO issued notice u/s. 148 of the Act on 31.03.2016. In response to said notice, the appellant vide letter dated 02.06.2016 requested

Gopal Krishan Bansal, Mandi Gobindgarh, Punjab vs. ITO Ward -1, Mandi Gobindgarh, Sirhind

In the result, appeal of the Assessee is allowed and cross appeal filed by the Revenue is dismissed

ITA 614/CHANDI/2025[2013-14]Status: DisposedITAT Chandigarh11 Feb 2026AY 2013-14

Bench: SHRI. LALIET KUMAR (Judicial Member), SHRI. KRINWANT SAHAY (Accountant Member)

For Appellant: Shri Sudhir Sehgal, AdvocateFor Respondent: Shri Vivek Vardhan, Addl. CIT, Sr. DR

Section 143(3)Section 148Section 149

course of assessment proceedings, the show cause notice was issued to the assessee and the assessee contented that it was a case of only borrowed satisfaction and submitted the invoices of the parties alongwith copies of account of the said parties and also stated that all the payments in respect

Income Tax Office, Ward-I Mandi Gobindgarh Hq Sirhind vs. Gopal Krishan Bansal, Aggarwal Steel Tubes

In the result, appeal of the Assessee is allowed and cross appeal filed by the Revenue is dismissed

ITA 478/CHANDI/2025[2013-14]Status: DisposedITAT Chandigarh11 Feb 2026AY 2013-14

Bench: SHRI. LALIET KUMAR (Judicial Member), SHRI. KRINWANT SAHAY (Accountant Member)

For Appellant: Shri Sudhir Sehgal, AdvocateFor Respondent: Shri Vivek Vardhan, Addl. CIT, Sr. DR

Section 143(3)Section 148Section 149

Meghji Mansukhlal Dodhia, Bhiwandi vs. DCIT-CC-3, Thane

ITA 2224/MUM/2025[2013-14]Status: DisposedITAT Mumbai11 Feb 2026AY 2013-14

Bench: Shri Amit Shukla & Shri Makarand Vasant Mahadeokar1. It(Ss)A No. 2226/Mum/2025 S.A. No. 79/Mum/2025 (Assessment Year: 2012-13) Mansukhlal Meghji Dodhia House No. 104, Dodhia House, New Mavji Compound, Narpoli, Maharashtra-421 302 (Applicant) Dcit Cc-3, Thane Vs. Room No. 12, A Wing, 6Th Floor, Ashar It Park, Thane, West, Maharashtra - 400 604 Pan/Gir No. Aaspd6746L (Respondent) 2. Ita No. 2224/Mum/2025 S.A. No. 80/Mum/2025 (Assessment Year: 2013-14) 3. It(Ss)A No. 2223/Mum/2025 S.A. No. 81/Mum/2025 & 4. It(Ss)A No. 2222/Mum/2025 S.A. No. 82/Mum/2025 (Assessment Year: 2015-16) 5. It(Ss)A No. 2225/Mum/2025 S.A. No. 83/Mum/2025 (Assessment Year: 2016-17) Meghji Mansukhlal Dodhia House No. 104, Dodhia House, New Mavji Compound, Narpoli, Maharashtra-421 302 (Applicant) Dcit Cc-3, Thane Vs. Room No. 12, A Wing, 6Th Floor, Ashar It Park, Thane, West, Maharashtra - 400 604 Pan/Gir No. Aaspd6746L (Respondent) (2) It(Ss)A No. 2226, 2223, 2222 & 2225/Mum/2025 &

Section 132Section 143(3)Section 153ASection 68Section 69D

Income Tax (Appeals) erred in not treating the re-opening of assessment as bad-in-law since the re- opening was entirely based on borrowed satisfaction and without application of mind on the part of the Ld. Assessing Officer. 2. On the facts and in the circumstances of the appellant ... Income Tax (Appeals) erred in not treating the re-opening of assessment as bad-in-law since the re- opening was entirely based on borrowed satisfaction and without application of mind on the part of the Ld. Assessing Officer. 2. On the facts and in the circumstances of the appellant

Gulmohar Towers Private Limited, Kolkata vs. Income Tax Officer, Ward 10(2), Kolkata

In the result, the appeal of the assessee is allowed

ITA 976/KOL/2025[2011-12]Status: DisposedITAT Kolkata10 Feb 2026AY 2011-12

Bench: Shri Rajesh Kumar, Am & Shripradip Kumar Choubey, Jm

For Appellant: Shri S. Jhajharia, ARFor Respondent: Shri P.N. Barnwal, DR

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

merely acted on the information received from investigation wing without any independent application of mind and this in fact case of borrowed satisfaction which is not permissible under the Act. Therefore, considering these facts and circumstances the reopening of assessment is void ab initio and invalid in the eyes ... held that the conclusions of the AO are at best a reproduction of the conclusion in the investigation report. Indeed it is a borrowed satisfaction. Besides the case of the assessee_ is squarely covered by the decisions of CIT vs. SFIL Stock Broking