External factual material can justify reassessment when it gives a reasonable basis to believe income escaped assessment.

Factual material obtained from outside the assessee's own record can constitute "information" for reopening under Section 147(b) of the Income-tax Act, 1961. Here, a later-year expert report and the partner's written admission indicated that the actual cost of centering machines was lower than the amount recorded in the books, giving the Income-tax Officer a reasonable basis to believe income had escaped assessment. The reopening was not treated as a mere change of opinion because it rested on fresh external material, not on a review of the original assessment.

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Issues: Whether the Income-tax Officer had information in his possession within the meaning of Section 147(b) of the Income-tax Act, 1961 so as to justify reopening and reassessment for assessment year 1965-66.

Analysis: The reassessment was founded on two materials obtained during assessment proceedings for a later year: the report of the Board of Experts showing a lower actual cost of centering machines than that claimed in the books, and the partner's written admission accepting computation on that basis. These materials had concrete existence, came from an external source, and bore directly on the assessee's true income. Information under Section 147(b) includes factual material obtained from outside the assessee's own record, and the existence of such material enabled the Income-tax Officer to form a reasonable belief that income had escaped assessment. The contention that this was merely a change of opinion was rejected because the reopening was based on fresh material and not on a mere review of the earlier assessment.

Conclusion: The reassessment was validly initiated under Section 147(b), and the question referred was answered in the affirmative.

Ratio Decidendi: Factual material obtained from an external source, including a relevant admission and expert report bearing on the assessment, constitutes information for Section 147(b) and can validly found a reasonable belief that income has escaped assessment.

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