Reassessment beyond four years barred where no failure to disclose material facts is shown and reopening reflects mere change of opinion.

Reassessment notice issued beyond four years from the end of the assessment year was invalid because the Revenue did not establish any failure by the assessee to fully and truly disclose all material facts necessary for assessment. The assessee's permanent establishment issue had already been examined in the earlier round, and no fresh or additional material supported the second reopening. On the recorded reasons, the reopening was therefore a mere change of opinion, and the jurisdictional requirement for invoking the proviso to Section 147 was not met. The notice was consequently barred by limitation and could not be sustained.

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Issues: Whether the notice for reopening the assessment under Section 148, issued beyond four years from the end of the relevant assessment year, was valid in the absence of any established failure by the assessee to fully and truly disclose all material facts necessary for assessment, and whether the reopening was vitiated by change of opinion.

Analysis: The reassessment notice was issued after the expiry of four years from the end of the assessment year, so the proviso to Section 147 applied. The issue of the assessee's permanent establishment in India had already been examined in the earlier round of proceedings, which culminated in an assessment at the lower rate of tax. No fresh or additional material was shown in support of the second reopening, and the recorded reasons did not explain how there had been any failure to disclose fully and truly all material facts on the very issue earlier considered. In these circumstances, the reopening amounted to a mere change of opinion and the jurisdictional condition for invoking the proviso to Section 147 was not satisfied.

Conclusion: The reassessment notice was barred by limitation and could not be sustained.

Ratio Decidendi: Where reassessment is sought beyond four years, the Revenue must establish a failure by the assessee to fully and truly disclose all material facts necessary for assessment, and reopening on an issue already examined earlier without fresh material is impermissible as a mere change of opinion.

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