Reopening for wrongly granted exemption and remand-based limitation extend reassessment within a composite assessment framework.

Section 14(4)(cc) permits reopening where exemption was wrongly granted, and the assessing authority may issue notice to examine whether the exemption and its attached conditions were legally justified without first proving escaped turnover. The fact that the notice concerns possible wrong allowance does not make it a mere change of opinion on the facts noted. Limitation is also governed by the remand effect under section 14(7): when an assessment is set aside by a competent authority, fresh assessment may be completed within the enlarged period, and the proceeding is treated as a composite assessment. The reassessment was therefore within jurisdiction and time.

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Issues: (i) Whether the assessing authority had jurisdiction under section 14(4)(cc) to issue notice proposing withdrawal of exemptions already granted on the ground that they were wrongly allowed. (ii) Whether the proposed reassessment was barred by limitation in view of section 14(4-A) and section 14(7), and whether the earlier exemption order for part of the turnover stood outside the scope of the remand.

Issue (i): Whether the assessing authority had jurisdiction under section 14(4)(cc) to issue notice proposing withdrawal of exemptions already granted on the ground that they were wrongly allowed.

Analysis: The statutory power to reopen assessment under section 14(4)(cc) extends to cases where exemption has been wrongly granted. The notice was only for enquiry into whether the earlier exemptions were legally justified and whether the conditions attached to the Government order were established. The existence of escaped turnover or wrong exemption need not be proved as a condition precedent before initiating such enquiry, because those very questions are to be examined in the reassessment process. The contention that the notice reflected only a change of opinion or depended solely on non-maintenance of accounts was rejected on the facts found.

Conclusion: The assessing authority had jurisdiction to issue the notice and proceed under section 14(4)(cc).

Issue (ii): Whether the proposed reassessment was barred by limitation in view of section 14(4-A) and section 14(7), and whether the earlier exemption order for part of the turnover stood outside the scope of the remand.

Analysis: The court held that the limitation under section 14(4-A) is extended by section 14(7) when an assessment order is set aside by a competent authority, and the fresh assessment can be made within the enlarged period. The entire assessment proceeding was treated as one composite assessment, and the earlier allowance of exemption for part of the turnover was not a separate and final assessment immune from the effect of remand. The proposed action was therefore within time and not defeated by the argument that the earlier exemption had attained finality independently.

Conclusion: The proposed reassessment was not barred by limitation, and the remand covered the entire assessment proceedings including the disputed exemption.

Final Conclusion: The notice proposing to withdraw the exemptions was held to be within jurisdiction and within time, so the writ petition failed.

Ratio Decidendi: A reopening provision permitting reassessment for wrongly allowed exemption can be invoked without first proving escaped turnover as a condition precedent, and where an assessment is set aside by a competent authority the limitation for fresh assessment runs in accordance with the statutory exclusion applicable to the entire assessment proceeding.

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