Reopening of income-tax assessment upheld where capital introduction and failure to file a return supported belief of escaped income.

Income-tax reopening under section 147(a) was held valid where the assessee introduced Rs. 13,000 as capital in a partnership, providing material for a reasonable belief that income had escaped assessment. The earlier attempt to assess the same amount in the hands of the Hindu undivided family did not bar action against the assessee individually, because the prohibition on mere change of opinion applies only to reopening the same assessee's completed assessment. Failure to file a return was also treated as an omission supporting reopening, since a person with taxable income has a statutory duty to file a return.

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Issues: Whether, on the facts and in the circumstances of the case, the Income-tax Officer had valid jurisdiction to reopen the assessment under section 147(a) of the Income-tax Act, 1961.

Analysis: The introduction of Rs. 13,000 by the assessee as capital in the partnership furnished material on which the Income-tax Officer could reasonably believe that income chargeable to tax had escaped assessment. The prior attempt to assess the same amount in the hands of the Hindu undivided family did not bar proceedings against the assessee individually after the family assessment failed, because the bar against change of opinion applies where the same assessee's completed assessment is reopened. The omission to file a return was also held to attract the reopening provision, since a person whose income exceeds the taxable minimum is under a statutory obligation to file a return and failure to do so amounts to omission within the meaning of the provision.

Conclusion: The jurisdiction under section 147(a) was validly invoked and the answer to the referred question was in the affirmative, against the assessee.

Ratio Decidendi: Material showing introduction of money as capital by the assessee can constitute reason to believe that income has escaped assessment, and where no prior assessment exists against the same assessee, proceedings are not barred merely because a different view had earlier been taken in proceedings against another assessee; failure to file a required return also supports action for escaped assessment.

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