Reassessment for escaped turnover upheld where the specific exemption issue was never examined in the original assessment.

Reopening of assessment is permissible where the assessing authority has relevant material giving rise to a rational belief that turnover escaped assessment or that an exemption was wrongly allowed. At the initiation stage, the writ court does not test the sufficiency of that material. Here, recorded CDs were not separately disclosed in the return or during assessment, and the specific question whether they were covered by the eligibility certificate had not been examined earlier. As no opinion on that issue had been formed in the original assessment, the reassessment notice was not barred as a mere change of opinion, and the challenge failed.

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Issues: Whether permission to reopen the assessment under Section 21 of the U.P. Trade Tax Act, 1948, on the basis that turnover of recorded CDs had escaped assessment and that exemption had been wrongly allowed, was legally justified or was barred as a mere change of opinion.

Analysis: Reopening under Section 21 is permissible where the assessing authority has reason to believe that turnover has escaped assessment or that an exemption has been wrongly allowed. The existence of relevant material at the initiation stage is sufficient; the writ court does not assess the sufficiency of that material. On the facts, the turnover of recorded CDs had not been separately disclosed in the return or during the assessment, the earlier assessment had proceeded only on the disclosed head of CDR, and the question whether recorded CDs were covered by the eligibility certificate had not been examined earlier. Since no opinion on that specific issue had been formed in the original assessment, the action could not be branded as a change of opinion.

Conclusion: The reopening was valid, the notice under Section 21 and the approval under Section 21(2) were upheld, and the challenge failed.

Ratio Decidendi: Reassessment is valid where there is relevant material giving rise to a rational belief of escaped assessment, and it is not barred as a change of opinion unless the very issue was earlier considered and decided in the original assessment.

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