Reassessment for lack of formed opinion upheld where reopening rested on record-based information, not a mere change of opinion.

Reassessment under section 34(1)(b) of the Income-tax Act, 1922 is valid where the original assessment did not form any definite opinion on the relevant issue and reopening is based on information derived from the record or a proper examination of the material. The original assessment for 1957-58 had not considered whether trust income was assessable in the settlor's hands because of the trust's revocability. Earlier assessments and isolated references to the trust deed did not amount to a concluded view. The reopening was therefore not a mere change of opinion and the reassessment was upheld.

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Issues: Whether the reassessment proceedings for the assessment year 1957-58 were validly initiated under section 34(1)(b) of the Income-tax Act, 1922, or whether they were barred as a mere change of opinion.

Analysis: The material on record showed that the original assessment for 1957-58 did not apply its mind to the specific question whether the trust income was assessable in the settlor's hands on account of the revocability of the trust. Earlier assessments and isolated references to the trust deed did not establish a concluded opinion on that issue. On the facts, the reopening was based on information emerging from the record and the proper construction of the trust deed, bringing the case within the scope of section 34(1)(b) as explained by the Supreme Court. It was therefore not a case of a mere change of opinion.

Conclusion: The reassessment proceedings were valid and were not bad in law.

Final Conclusion: The question referred was answered against the assessee and in favour of the Revenue, upholding the reopening for the assessment year 1957-58.

Ratio Decidendi: Reassessment under section 34(1)(b) is permissible where the original assessment had not formed any definite opinion on the relevant issue and the reopening is founded on information derived from the record or from a proper examination of the material, rather than on a mere change of opinion.

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