Reassessment for mere verification is invalid when sections 147 and 148 lack a sustainable jurisdictional basis.

Reassessment under sections 147 and 148 of the Income-tax Act, 1961 cannot be initiated merely to verify transactions; a sustainable belief that income chargeable to tax has escaped assessment is required. Here, the Assessing Officer proceeded on verification of transactions rather than on a substantive jurisdictional basis, and the Revenue did not rebut that factual position. The ITAT Delhi held that such verification-driven reopening failed the legal threshold for valid reassessment and quashed the proceedings in favour of the assessee.

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Issues: Whether reopening of assessment under sections 147 and 148 of the Income-tax Act, 1961, initiated only to verify transactions, was valid.

Analysis: The reopening was founded on the Assessing Officer's stated object of verifying transactions, rather than on a substantive belief that income chargeable to tax had escaped assessment. On the record, this factual basis was unrebutted by the Revenue. Reassessment proceedings initiated merely for verification do not satisfy the legal threshold for valid invocation of sections 147 and 148.

Conclusion: The reopening was invalid and was quashed, in favour of the assessee.

Ratio Decidendi: Reassessment cannot be initiated under sections 147 and 148 of the Income-tax Act, 1961, merely for verification of transactions without a sustainable jurisdictional basis.

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