“limited scrutiny”

Assessment ProceduresSection 143(3)Section 143(3)2,866 judgments

The decision most relied on for limited scrutiny is Vipan Khanna v. CIT (255 ITR 220), cited in 140 judgments on BharatTax.

Leading authorities on limited scrutiny

Vipan Khanna v. CIT

255 ITR 220 · 2002 · High Court

140

citing judgments

Assessment proceedings conclude and become final if a scrutiny notice under Section 143(2) is not served within the prescribed statutory period. This case also clarified the historical position that reassessment under Section 147/148 was restricted to issues for which reasons were recorded, a view superseded by Explanation 3 to Section 147.

Duggal & Co. v. CIT

220 ITR 456 · 1996 · High Court

citing judgments

An assessment order becomes erroneous and prejudicial to the revenue under Section 263 if the Assessing Officer fails to conduct a proper inquiry or investigation, even if the return appears prima facie correct. The Income-tax Officer has a duty to investigate and cannot remain passive.

Amal Kumar Ghosh v. Asstt. CIT

361 ITR 458 · 2014 · High Court

citing judgments

The selection of cases for scrutiny must be completed within the time prescribed by CBDT instructions. The department is bound by its own standards and cannot act with discrimination or selectively apply them.

PCIT v. Weilburger Coatings (India) (P.) Ltd.

155 Taxmann.com 580 · 2023 · High Court

citing judgments

Assessing officers cannot introduce issues for inquiry that were not part of the original limited scrutiny, without adhering to mandatory procedural requirements.

Balvinder Kumar v. PCIT

125 Taxmann.com 83 · 2021 · High Court

citing judgments

An Assessing Officer cannot travel beyond the scope of issues selected for limited scrutiny during the assessment proceedings.

PCIT v. Shark Mines and Minerals (P.) Ltd.

151 Taxmann.com 71 · 2023 · High Court

citing judgments

Revisionary powers under Section 263 cannot be invoked to find fault with an assessment order on an issue not covered by 'limited scrutiny' where the Assessing Officer could not have examined such an issue.

CIT v. Smt. Padmavathi

120 Taxmann.com 187 · 2020 · High Court

citing judgments

An assessment order cannot be held erroneous and prejudicial to revenue if the Assessing Officer (AO) could not have travelled beyond the issues forming the subject matter of 'limited scrutiny'. The Principal Commissioner of Income Tax (PCIT) cannot invoke Section 263 to set aside an assessment on grounds not forming part of the limited scrutiny.

Mahanagar Telephone Nigam Ltd. v. Chairman, Central Board of Direct Taxes and Another

246 ITR 173 · 2000 · High Court

citing judgments

An Assessing Officer can initiate reassessment proceedings under Section 147 even if a scrutiny notice under Section 143(2) was not issued within the prescribed time, provided the conditions for Section 147 are met. An intimation under Section 143(1)(a) does not preclude recourse to Section 147.

Judgments citing limited scrutiny

Universal Auto Gears LLP, Kolar vs. ACIT, Circle-4(2)(1), Bangalore

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

ITA 1370/BANG/2025[2016-17]Status: DisposedITAT Bangalore12 Nov 2025AY 2016-17

Bench: Shri Laxmi Prasad Sahu & Shri Soundararajan K.Assessment Year : 2016-17

For Appellant: Shri Pranav Krishna, AdvocateFor Respondent: Shri Subramanian .S, JCIT-DR

Section 142(1)Section 143(1)Section 143(2)Section 2(22)(e)

Thereafter the return was processed u/s. 143(1) of the Act. The case of the assessee was selected Page 2 of 4 for limited scrutiny and notice u/s. 143(2) was issued on 17/07/2017. A notice u/s. 142(1) was also issued. Detailed explanations were offered by the assessee

Coffeeday Trading Limited, Bangalore vs. DCIT, Circle-2(2)(1), Bangalore

In the result, the Assessee’s appeal is allowed for statistical purposes in the aforesaid terms

ITA 1172/BANG/2025[2020-21]Status: DisposedITAT Bangalore12 Nov 2025AY 2020-21

Bench: Shri Narender Kumar Choudhry & Shri Waseem Ahmedassessment Year: 2020-21

For Appellant: Ms. Mega , Ld. CA/ARFor Respondent: Shri Balusamy N, Ld. JCIT D.R

Section 143(2)Section 250

20/2014 dated 29.12.2015, which mandates that in the cases selected through CASS, it must be clearly indicated “whether the case has been selected for ‘limited scrutiny’ or ‘complete scrutiny’ “ and therefore the notice issued under section 143(2) is liable to be quashed, which would entail the assessment order being

Udita Gupta, Delhi vs. ACIT, Central Circle-29, New Delhi

In the result, appeal filed by the assessee is allowed

ITA 2532/DEL/2022[2016-17]Status: DisposedITAT Delhi12 Nov 2025AY 2016-17

Bench: Shris.Rifaur Rahman & Shri Anubhav Sharmaudita Gupta, Vs. Acit, Central Circle 29, 43/1, Rajpur Road, Civil Lines, Delhi. Delhi – 110 054. (Pan : Advpa9481B) (Appellant) (Respondent) Assessee By : Shri Saubhagya Agarwal, Advocate Revenue By : Shri Ajay Kumar Arora, Sr. Dr Date Of Hearing : 27.10.2025 Date Of Order : 12.11.2025 O R D E R Per S.Rifaur Rahman, Am: 1. This Appeal Is Filed By The Assessee Against The Order Of Ld. Commissioner Of Income-Tax Appeals-30, New Delhi [Hereinafter Referred To As ‘Ld. Cit (A)] Dated 21.09.2024 For Assessment Year 2016-17. 2. Brief Facts Of The Case Are, The Case Of The Assessee Was Picked Up For Limited Scrutiny & During The Assessment Proceedings, The Assessee’S Claim Of Earning Capital Gain Amounting To Rs.57,11,085/- & Rs.46,95,755/- From Sale Of Shares Of M/S Yamini Investment Pvt. Ltd. & M/S. Goenka Business & Finance Ltd. Totaling Rs.1,04,06,840/- Were Examined. The Assessing Officer

For Appellant: Shri Saubhagya Agarwal, AdvocateFor Respondent: Shri Ajay Kumar Arora, Sr. DR

Section 147Section 151Section 250Section 68

dated 21.09.2024 for Assessment Year 2016-17. 2. Brief facts of the case are, the case of the assessee was picked up for limited scrutiny and during the assessment proceedings, the assessee’s claim of earning capital gain amounting to Rs.57,11,085/- & Rs.46,95,755/- from sale of shares

Lila Infotech, Junagadh vs. Assessing Officer, Income Tax Office, Junagadh

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

ITA 169/RJT/2025[2016-17]Status: DisposedITAT Rajkot10 Nov 2025AY 2016-17

Bench: Dr. Arjun Lal Saini, Am. & Dinesh Mohan Sinha, Jm आयकरअपीलसं./Ita No.169/Rjt/2025 "नधा"रणवष" / Assessment Year: (2016-17) (Hybrid Hearing) Lila Infotech, Vs. Assessing Officer Shop No. 128, Platinum Plaza, Income Tax Office, Bhootnath 1St Floor, Chamber, Junagadh - 362001 Junagadh - 362001 "थायीलेखासं./जीआइआरसं./Pan/Gir No.: Aaffl9258G (Appellant) (Respondent) Appellant By : Shri Chetan Agarwal, Ld. Ar Respondent By : Shri Abhimanyu Singh Yadav Ld. Sr. Dr Date Of Hearing : 13 / 08 /2025 Date Of Pronouncement : 10 / 11 /2025

For Appellant: Shri Chetan Agarwal, Ld. ARFor Respondent: Shri Abhimanyu Singh Yadav Ld. SR. DR

Section 143(3)Section 250Section 68

InfoTech. Return of income for A Y 2016-17 was filed on 12.10.2016 declaring total income of Rs.25,360/-. The case was selected for limited scrutiny for verifying the unsecured loans taken by the assessee notice were issued to the assessee. In response to notice various details were submitted

DCIT Central Circle-31, New Delhi vs. Sneh Quality Spices Pvt. Ltd., New Delhi

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

ITA 1740/DEL/2023[2014-15]Status: DisposedITAT Delhi10 Nov 2025AY 2014-15

Bench: Ms. Madhumita Roy & Shri Naveen Chandra

For Appellant: Shri Suresh Singhal, CAFor Respondent: Shri Mahesh Kumar, CIT-DR

Section 69B

Rs.11,12,94,857/- 7.1 The AO has observed in the assessment order that the case was selected for limited scrutiny under CASS and it was noted in the computation of income that the assessee has claimed deduction u/s 35AD. References to District Valuation Officer (DVO), Jaipur and Valuation Officer

Sneh Quality Spices Private Limited, Khari Baoli vs. DCIT Circle 24(1), New Delhi

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

ITA 1234/DEL/2023[2014-15]Status: DisposedITAT Delhi10 Nov 2025AY 2014-15

Bench: Ms. Madhumita Roy & Shri Naveen Chandra

For Appellant: Shri Suresh Singhal, CAFor Respondent: Shri Mahesh Kumar, CIT-DR

Section 69B

Gottimukkala Vidya Latha, Vijayawada vs. ITO, Ward-1(1), Vijayawada

In the result, appeal of the assessee is allowed

ITA 440/VIZ/2025[2017-18]Status: DisposedITAT Visakhapatnam07 Nov 2025AY 2017-18

Bench: Shri Ravish Sood, Hon’Ble

Section 131Section 133(6)Section 143(2)Section 143(3)Section 69A

assessee filed return of income for the A.Y. 2017-18 on 21.12.2017 admitting a total income of Rs.5,060/-. The case was selected for limited scrutiny through CASS on the issue of “cash deposits during demonetization period”. Notice under section 143(2) and 142(1) of the Act were issued

Jain Babulal Champatlal, Vijayawada vs. Income Tax Officer, Ward 2(1), Vijayawada

In the result, both the appeals filed by the assessee are 9

ITA 395/VIZ/2025[2017-18]Status: DisposedITAT Visakhapatnam07 Nov 2025AY 2017-18

Bench: Shri Ravish Sood, Hon’Ble & Shri S Balakrishnan, Hon’Bleआयकर अपीलसं./I.T.A.Nos.394 & 395/Viz/2025 (निर्धारणवर्ा/ Assessment Year:2017-18) Vs. Jain Babulal Champatlal Income Tax Officer – Ward – 2(1) Cr Building, 1St Floor Annex 40-1-155, Lgf Mg Road, Vijayawada – 520002 Ripples Mall, M.G. Road Andhra Pradesh Vijayawada-520010 Andhra Pradesh [Pan:Aefpc1220F]

Section 142(1)Section 143(2)Section 143(3)Section 270ASection 57

admitting a total income of Rs.22,43,340/- and agricultural income of Rs.57,900/-. Subsequently, the case was selected for limited scrutiny under CASS. Accordingly, statutory notices under section 143(2) and 142(1) of the Act were issued and served on the assessee. Thereafter, notice under section

Jain Babulal Champatlal, Vijayawada vs. Income Tax Officer, Ward 2(1), Vijayawada

In the result, both the appeals filed by the assessee are 9

ITA 394/VIZ/2025[2017-18]Status: DisposedITAT Visakhapatnam07 Nov 2025AY 2017-18

Section 142(1)Section 143(2)Section 143(3)Section 270ASection 57

Purna Chander Ragam, Hyderabad vs. ITO., Ward-11(1), Hyderabad

In the result, appeal filed by the assessee is allowed for statistical purposes in terms of our above observations

ITA 984/HYD/2025[2017-18]Status: DisposedITAT Hyderabad07 Nov 2025AY 2017-18

Bench: Us:

Section 143(2)Section 144Section 250

assessment year 2017-18 on 28/11/2017 declaring an income of Rs. 8,79,830/-. Subsequently, the case of the assessee was selected for limited scrutiny under CASS to examine and verify “large cash payments made for credit card purchases” during the subject year. Notice under section

Jagadishwar Barma, Hyderabad vs. ITO, Ward-11(2), Hyderabad

ITA 1436/HYD/2025[2017-18]Status: DisposedITAT Hyderabad07 Nov 2025AY 2017-18

Bench: Us:

Section 115BSection 143(3)Section 2(14)Section 294Section 69A

therefore, the proceeds are not taxable. 4. The authorities below erred in ignoring that the case was selected for limited scrutiny only to verify cash deposits during the demonetization period (08.11.2016 to 30.12.2016). Hence, inclusion of deposits made prior to demonetization (Rs. 10,00,000/- on 06.09.2016) is beyond jurisdiction ... declaring an income of Rs. 3,71,720/-. Subsequently, the case of the assessee was selected under CASS for “Limited scrutiny” for verifying the “Cash Deposits (Demonetization)”. 3. During the course of the assessment proceedings, the AO observed that the assessee had, during the subject year, made cash deposits

Viva Boards Private Limited, Nizamabad vs. DCIT., Circle-8(1), Hyderabad

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

ITA 1303/HYD/2025[2017-18]Status: DisposedITAT Hyderabad07 Nov 2025AY 2017-18

Bench: SHRI G. MANJUNATHA, HON’BLE (Accountant Member), SHRI RAVISH SOOD, HON’BLE (Judicial Member)

Section 115BSection 131Section 142(1)Section 143(2)Section 68

income for A.Y. 2017-18 on 30-10-2017, admitting total loss of Rs. 4,23,41,850/-. The case was selected for limited scrutiny through CASS and notice under Section 143(2) of the Income Tax Act, 1961, along with notice under Section

Right Way Logistics Pvt. Ltd., Chennai vs. ITO, Corporate Ward-5(3), Chennai

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

ITA 2915/CHNY/2024[2016-17]Status: DisposedITAT Chennai07 Nov 2025AY 2016-17

Bench: Shri Aby T. Varkey & Shri S.R.Raghunatha

For Appellant: Mr.N. Arjun Raj, Advocate

Section 143(3)Section 194CSection 40

relating to the import or export of goods at a customs station on behalf of its customers (Exporter or Importer). The AO during the limited scrutiny inter-alia asked the assessee ‘as to why’ the TDS hasn’t been deducted for the CFS charges/expenses claimed to have been incurred

Yusuf Ashraf Shaikh, Mumbai vs. Income Tax Officer - Ward 27(3)(1), Mumbai

In the result, the appeal stands allowed for statistical

ITA 2898/MUM/2025[2018-19]Status: DisposedITAT Mumbai07 Nov 2025AY 2018-19

Bench: Justice (Retd.) C. V. Bhadang & Shri Prabhash Shankar

For Appellant: Shri Chirayu Panarkar,ARFor Respondent: Shri Swapnil Choudhary, (Sr.AR)

Section 143(2)Section 143(3)Section 253Section 68Section 69A

Airtel. Return of income for the year under consideration was filed declaring total income of Rs.9,57,100/-. Subsequently, the case was selected for Limited scrutiny for the scrutiny of "high value cash deposits in SFT”. Notice u/s 143(2) of the Act was issued and served upon the assessee

Prashant Kumar, Delhi vs. Asst CIT, Circle 70(1), Delhi

Appeal is allowed in the aforesaid terms

ITA 5624/DEL/2025[2017-18]Status: DisposedITAT Delhi07 Nov 2025AY 2017-18

Bench: Shri Mahavir Singh, Hon’Bleasstt. Year : 2017-18

For Appellant: Sh. M.K. Bhatt, CA & Sh. Malav Gosowami, AdvFor Respondent: Shri Manoj Kumar, Sr. DR

Section 142(1)Section 143(2)Section 15BSection 69A

declaring total income of Rs. 30,48,160/-. The case was selected for scrutiny through CASS under "Limited Scrutiny” due to reasons 'Salary income and cash deposit and transaction in property". Notice u/s 143(2) dated 20.08.2018 was issued and served upon the assessee. Thereafter, the file of the appellant

Niraj Kumar Singh, Delhi vs. Income Tax Officer 70(5), Delhi

Appeal is partly allowed in the aforesaid terms

ITA 5556/DEL/2025[2017-18]Status: DisposedITAT Delhi07 Nov 2025AY 2017-18

Bench: Shri Mahavir Singh, Hon’Bleasstt. Year : 2017-18

For Appellant: NoneFor Respondent: Shri Manoj Kumar, Sr. DR

Section 115Section 115BSection 143(3)Section 69A

individual and filed his return of income for AY 2017-18 declaring total income on Rs. 4,44,400/-. The case was selected for Limited scrutiny under CASS for the reason “cash deposit during demonetization period”. Notices were issued from time to time and duly served upon the appellant

DCIT, Circle 4(2), New Delhi vs. Ms Communique Marketing Solutions Pvt Ltd, New Delhi

In the result, the appeal of Revenue is dismissed and cross-objection of Assessee is allowed

ITA 4762/DEL/2024[2017-18]Status: DisposedITAT Delhi07 Nov 2025AY 2017-18

Bench: Shri S Rifaur Rahman & Shri Vimal Kumarassessment Year: 2017-18 Deputy Commissioner Of Income Vs. Ms Commmunique Marketing Tax, Circle 4(2), Solutions (P) Ltd., 5407, Arya Samaj New Delhi. Road, Karol Bagh, New Delhi-110005 Pan :Aaccc3432F (Appellant) (Respondent)

Section 115Section 115BSection 142(1)Section 143(1)Section 143(2)Section 250Section 37Section 68

return was processed under Section 143(1) Act. The revised return of the assessee was selected by CASS for Limited Scrutiny for assessment year 2017-18 to verify two issues i.e. (i) Bonus or Commission Paid to Employee and (ii) Unsecured Loans. Notice under Section

Babubhai Kanjibhai Sakaria, Jetpur vs. ITO WD 1(2)(1), Rajkot

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

ITA 156/RJT/2025[2016-17]Status: DisposedITAT Rajkot06 Nov 2025AY 2016-17

Bench: Dr. Arjun Lal Saini & Shri Dinesh Mohan Sinhaआयकर अपील सं./Ita No. 156/Rjt/2025 (Assessment Year: 2016-17) Babubhai Kanjibhai Sakariya Vs. Ito, Wd 1(2)(1), Rajkot Plot No. 82 Satyam Park, Amarnagar Aaykar Bhavan, Race Course Ring Road, Jetpur,(Rajkot-Gujarat) -360370 Road, Rajkot 360001 "ायीलेखासं./जीआइआरसं./Pan/Gir No.: Agnps7407C (अपीलाथ"/Appellant) (""थ"/Respondent)

For Appellant: Shri Rajendra Singhal, Ld. ARFor Respondent: Shri Abhimanyu Singh Yadav, Ld. Sr. DR

Section 142(1)Section 143(1)Section 143(2)Section 143(3)Section 194ASection 250Section 28

processed u/s.143(1) of the Act accepting the returned income. Later on, the assessee`s case was selected for scrutiny through CASS for Limited scrutiny Page 2 of 19 Babubhai K. Sakaria and a notice u/s.143(2) of the Act, was issued on 13.07.2017 and duly served upon the assessee

Malini Jignesh Doshi, Ahmedabad vs. ITO Ward 5(3)(1), Ahmedabad

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

ITA 755/AHD/2025[2017-2018]Status: DisposedITAT Ahmedabad06 Nov 2025AY 2017-2018

Bench: Dr. Brr Kumar & Shri Siddhartha Nautiyal

For Appellant: Shri Ankit Choksi, ARFor Respondent: Shri Ravindra, Sr. DR

Section 115BSection 143(3)Section 271ASection 69A

income for Assessment Year 2017-18 declaring a total income of Rs. 3,51,900/-. The case of the assessee was selected for limited scrutiny for verification of cash deposits made during the demonetization period. During the course of assessment proceedings, the Assessing Officer observed that the assessee had deposited

Axiomatic Itech Pvt. Ltd., Ahmedabad vs. The ITO, Ward-1(1)(4), Ahmedabad

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

ITA 191/AHD/2025[2016-17]Status: DisposedITAT Ahmedabad06 Nov 2025AY 2016-17

Bench: Dr. Brr Kumar & Shri Siddhartha Nautiyal

For Appellant: Shri S N Divatia, ARFor Respondent: Shri C Dharani Nath, Sr. DR

Section 133(6)Section 143(1)Section 250Section 35(1)Section 35(1)(ii)

return was processed under section 143(1) of the Income- tax Act, 1961 (the “Act”), and later selected for limited scrutiny through CASS for the purpose of verifying the “large deduction claimed under section 35(1) of the Act.” During the scrutiny proceedings, the Assessing Officer (AO) noticed that