Section 147 of the Income Tax Act
Income-tax Act, 2025: s.279
Section 147 of the Income-tax Act, 1961 corresponds to section 279 (Income escaping assessment) of the Income-tax Act, 2025.
Read section 279 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 147 is National Thermal Power Co. Ltd. v. CIT (229 ITR 383), cited in 5,834 of the 49,210 judgments on BharatTax that turn on this section.
Leading authorities on Section 147
Appellate authorities can consider new claims and additional grounds if the relevant facts are already on record. The purpose of assessment is to correctly determine tax liability, allowing both parties to raise issues.
Delay in filing appeals, when supported by sufficient or justifiable cause, should be condoned with a liberal approach to ensure substantial justice. This principle prioritizes the cause of justice over mere technicalities.
In a search assessment under Section 153A, additions can only be made for completed or non-abated assessment years if incriminating material relevant to those years is found during the search, although notice under Section 153A(1) is mandatorily issued for six assessment years preceding the search.
For revision under Section 263, the Assessing Officer's order must be both erroneous and prejudicial to the interests of the revenue; if either condition is not met, the revisionary jurisdiction cannot be invoked. An order is not erroneous merely because the Assessing Officer did not record the details of enquiries conducted, provided due enquiries were made.
An assessment under section 153A is without jurisdiction if there is an absence of incriminating material for an unabated assessment year.
An appeal before the Income Tax Appellate Tribunal can be dismissed for non-prosecution or treated as unadmitted when the appellant fails to appear, cooperate, or show diligence, in accordance with Rule 19(2) of the Income-tax (Appellate Tribunal) Rules. The law aids the vigilant, not those who sleep on their rights.
Penalty under Section 271(1)(c) for furnishing inaccurate particulars or concealment of income is not automatically leviable if the assessee has made a full disclosure of all particulars and the addition or disallowance arises from a difference of opinion.
A court or tribunal is not bound to answer a reference or adjudicate an appeal on its merits if the party at whose instance the proceeding is made fails to appear at the hearing or take necessary steps for its proper conduct.
The Revenue is entitled to look behind the apparent form of a transaction to discover its true nature, applying the test of human probabilities and surrounding circumstances. If transactions defy logic or are unnatural, they can be treated as bogus, even if supported by some documentation, especially in cases of cash credits or unexplained investments.
An assessee cannot raise a new claim or a claim not made in the original or revised return of income for the first time directly before the Assessing Officer during assessment proceedings.
