Reopening on same material rejected where no fresh information existed to justify reassessment under section 147(b).

Section 147(b) permitted reassessment only on the basis of information coming into the Income-tax Officer's possession after the original assessment, giving reason to believe that income had escaped assessment. A mere later realisation, on reconsideration of the same material already on record, that corporation tax rebate had been wrongly computed did not constitute fresh information. Because the reopening was founded only on an alleged mistake in the original computation without any new material, it was invalid and not sustainable under section 147(b).

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Issues: Whether the assessment could validly be reopened under section 147(b) of the Income-tax Act, 1961, on the basis of a later realisation that the corporation tax rebate had been wrongly computed on the same material already available at the original assessment.

Analysis: Section 147(b) permits reopening only where the Income-tax Officer has, in consequence of information in his possession, reason to believe that income chargeable to tax has escaped assessment. A mere discovery, on reconsideration of the same material, that an error or omission was committed in the original assessment does not amount to the requisite information. On the facts, the reopening was founded on the belief that rebate had been allowed in excess because the original computation had overlooked the effect of the dividend and loss figures already on record. There was no fresh material brought to the notice of the Income-tax Officer after the assessment so as to justify action under section 147(b).

Conclusion: The reopening was invalid and was not sustainable under section 147(b); the issue was decided in favour of the assessee.

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