Tribunal: Reassessment for 1970-71 invalid under Income-tax Act. Unauthorized change of opinion.

The Tribunal held that the reassessment for the assessment year 1970-71 under section 147(a) of the Income-tax Act was impermissible and unsustainable. Despite a third party disputing cash credits, the assessee had fully disclosed all material facts during the original assessment. The Income-tax Officer's attempt to reopen the assessment based on new evidence was deemed unauthorized as it amounted to a change of opinion, which is not permissible under the law. The Tribunal rejected the Revenue's claim for a referable question of law and denied costs, affirming that the reassessment was unjustified.

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Issues: Assessment year 1970-71 - Reopening of assessment under section 147(a) of the Income-tax Act, 1961 - Validity of cancellation of reassessment based on information provided by a third party.

Analysis:
The case involved a petition under section 256(2) of the Income-tax Act, 1961, concerning the assessment year 1970-71. The Commissioner of Income-tax sought a mandamus directing the Income-tax Appellate Tribunal to refer a question of law arising from the cancellation of reassessment. The original assessment revealed cash credits in the name of a third party, Basheshar Lal, which were later disputed by him. The Income-tax Officer reopened the assessment based on Basheshar Lal's complaints, leading to the addition of the cash credit as unexplained. The Tribunal, however, found that the assessee had disclosed all material facts during the original assessment and that the reopening was not justified. They concluded that the Income-tax Officer's attempt to revise his earlier finding with additional evidence was unauthorized under the Income-tax Act. Therefore, the reassessment was deemed impermissible and unsustainable.

The Tribunal's findings indicated that the assessee had fully disclosed primary facts during the original assessment, even though Basheshar Lal had become uncooperative. The indirect evidence provided by the assessee, such as sale deeds and bank account statements, had initially led the Income-tax Officer to accept the genuineness of the cash credit. The Tribunal emphasized that the Income-tax Officer's decision to reopen the assessment based on a change of opinion was not permissible. They highlighted that the assessee had not failed to disclose relevant information, and the Income-tax Officer could not rectify his own error through reassessment under section 147(a). Consequently, the Tribunal rejected the Revenue's claim for a referable question of law and declined to award costs in the matter.

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