Change of opinion bars reassessment where scrutiny assessment already examined the same material and no fresh tangible material emerged.

Reassessment under sections 147 and 148 cannot rest on the same material already examined in a scrutiny assessment under section 143(3) where the Assessing Officer had issued detailed queries, considered the assessee's replies, and accepted the return. In that situation, reopening requires fresh tangible material giving a prima facie reason to believe that income has escaped assessment; otherwise it becomes a review under the guise of reassessment and is hit by the change of opinion principle. The proviso to section 147 also limits reopening beyond four years unless there was failure to disclose fully and truly all material facts. On the stated facts, the reopening was invalid.

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Issues: Whether reassessment under sections 147 and 148 of the Income-tax Act, 1961 was valid when the original assessment under section 143(3) had been completed after inquiry and the material relied upon for reopening was already on record, making the reopening a mere change of opinion.

Analysis: The original assessment was framed after issuance of a detailed questionnaire, replies from the assessee, and verification of books, accounts, computations, and share transactions. The record showed that the Assessing Officer had applied his mind and accepted the returned income. In such a situation, reopening is permissible only if there is new tangible material leading to a prima facie reason to believe that income has escaped assessment. Where the same material is reconsidered and no new fact or information emerges, reassessment amounts to a review under the guise of reassessment. The principle of change of opinion applies fully when the issue was raised during the original assessment, answered by the assessee, and accepted without addition. The decision also treated the statutory scheme and the proviso to section 147 as limiting reopening beyond four years in the absence of failure to disclose fully and truly all material facts.

Conclusion: The reopening was invalid as it was based on a mere change of opinion and lacked fresh tangible material; the assessee succeeded.

Ratio Decidendi: After a scrutiny assessment under section 143(3), reassessment under sections 147 and 148 cannot be sustained on reconsideration of the same material already examined, and the Assessing Officer must have fresh tangible material showing escapement of income rather than a mere change of opinion.

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