Reassessment based on mere change of opinion, without fresh material, is invalid and without jurisdiction.

Reassessment is invalid where reopening is founded only on a change of opinion on the same material and not on fresh information. The earlier assessment had allowed exemption of the assessee's business income on the basis that it was a credit society, and the later action relied on no newly discovered material. In those circumstances, reopening under section 147(b) was without jurisdiction and could not be sustained merely because the assessing officer later adopted a different view of the same facts.

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Issues: Whether the reassessment proceedings initiated under section 147(b) of the Income-tax Act, 1961 for the relevant assessment years were without jurisdiction and invalid.

Analysis: The original assessments had allowed exemption of the assessee's entire business income on the footing that it was a credit society. The later reassessment was founded on no fresh material and only on a different view of the same facts. The record did not show that the earlier allowance was based on any newly discovered information. In such a situation, reopening could not be justified merely because the Income-tax Officer later formed a different opinion on the same material.

Conclusion: The reassessment under section 147(b) was invalid and without jurisdiction. The finding is in favour of the assessee and against the revenue.

Final Conclusion: The reference was answered in favour of the assessee on the ground that the reopening amounted only to a change of opinion and not to reassessment on the basis of fresh material.

Ratio Decidendi: Reassessment under section 147(b) cannot be sustained where it is founded only on a change of opinion on the same material and not on fresh information that justifies reopening.

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