Change of opinion bars reassessment where no fresh tangible material supports reopening of agricultural income treatment.

Reassessment under sections 147 and 148 could not be sustained where the original scrutiny assessment had already examined mushroom farming income and accepted it as agricultural income on the same material. The Revenue relied on a circular and a different view of "agriculture", but no fresh tangible material had emerged after the section 143(3) assessment. Applying the live-link requirement for reopening, the court treated the notice as founded on a mere change of opinion rather than new information. The section 148 notice and the consequent rejection order were quashed in favour of the assessee.

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Issues: Whether reassessment under sections 147 and 148 of the Income-tax Act, 1961 could be sustained when the original scrutiny assessment had accepted the assessee's mushroom farming income as agricultural income and no fresh tangible material had emerged thereafter.

Analysis: The original assessment under section 143(3) had examined the nature of the assessee's activity and, on the material placed before the Assessing Officer, treated the income from mushroom farming as agricultural income. The reopening was founded on the same material, with the Revenue relying principally on a circular and a different view of the word "agriculture". The governing test for reopening requires a live link between the formation of belief and new tangible material. A mere reappraisal of the same material amounts to change of opinion, which cannot justify reassessment. A pre-existing circular, especially when its relevance has not been shown to have newly emerged, does not constitute fresh tangible material.

Conclusion: The reopening was jurisdiction and could not be sustained; the notice under section 148 and the rejection order were liable to be quashed in favour of the assessee.

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