Reassessment under U.P. VAT Act needs concrete material and reason to believe; mere change of opinion cannot justify action.

Reassessment under the U.P. VAT Act requires an objective reason to believe, based on concrete material, that turnover has escaped assessment, been under-assessed, taxed at a lower rate, or wrongly allowed as deduction or exemption. A later view on the same material amounts only to a change of opinion and cannot justify reassessment or be used as a substitute for review of the original assessment. The extended limitation period does not dispense with this jurisdictional requirement. On that basis, the reassessment proceedings, the Commissioner's permission, and the consequential notices were held invalid and quashed.

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Issues: Whether the reassessment proceedings and the Commissioner's permission under the U.P. VAT Act were valid in the absence of material giving rise to a reason to believe that turnover had escaped assessment, or whether the action was merely a change of opinion and therefore without jurisdiction.

Analysis: Section 29 of the U.P. VAT Act permits reassessment only when the assessing authority has reason to believe that turnover has escaped assessment, has been under-assessed, has been assessed at a lower rate, or a wrong deduction or exemption has been allowed. The existence of such reason to believe is a mandatory jurisdictional condition, and the later commencement of proceedings within the extended limitation period under Section 29(7) does not dispense with that requirement. The phrase "reason to believe" was treated as requiring an objective basis founded on concrete material, and not a mere subjective reappraisal of the original assessment. Applying that principle, the subsequent view that the goods should have been taxed at a higher rate amounted only to a change of opinion based on the same material, which could not support reassessment. The assessing authority also could not use reassessment as a substitute for review of its own order.

Conclusion: The reassessment proceedings were without jurisdiction, and the Commissioner's permission and consequential notices were invalid.

Final Conclusion: The writ petition was allowed and the impugned reassessment order and notices were quashed.

Ratio Decidendi: Reassessment can be initiated only on the basis of fresh, concrete material giving rise to an objective reason to believe that turnover has escaped assessment, and it cannot be founded on a mere change of opinion or used as a de facto review of the original assessment.

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