Reassessment requires a valid, material-based reason to believe; reopening on a mistaken statutory premise is without jurisdiction.

Reassessment is valid only where the assessing authority first records a bona fide reason to believe, based on relevant material, that turnover has escaped assessment under the correct statute. That belief must have a rational nexus with the record and cannot rest on extraneous or mistaken premises. Where the original assessment does not show a formed opinion, a change-of-opinion objection may not succeed; however, the reopening still fails if the recorded basis is factually incorrect or unsupported by independent material. The text states that a notice founded on proceedings under a different statutory regime was extraneous and insufficient to confer jurisdiction.

---

---

Issues: Whether reassessment proceedings were validly initiated on the basis of a legally sustainable reason to believe that turnover had escaped assessment, and whether the action amounted to a mere change of opinion.

Analysis: Reassessment can be sustained only if the assessing authority first establishes the jurisdictional fact of escaped assessment through a valid reason to believe founded on relevant material. Such belief must have a rational nexus with the material on record and cannot rest on extraneous or irrelevant considerations. Where the original assessment order is silent and records no formed opinion on the treatment of the commodity, a later challenge on the ground of change of opinion may fail; yet the revenue must still show that the recorded basis for reopening was supported by material and was not factually erroneous. In the present case, the notice for reopening relied on a mistaken premise drawn from proceedings under a different statutory regime and did not disclose any independent material showing that the commodity had escaped assessment under the applicable Act. The recorded basis was therefore extraneous and insufficient to found jurisdiction.

Conclusion: The reassessment was initiated without a valid reason to believe and was without jurisdiction. The issue is answered in favour of the assessee and against the revenue.

Ratio Decidendi: Reassessment proceedings are void unless the assessing authority records a bona fide, material-based reason to believe that turnover has escaped assessment under the correct statute; a reopening founded on irrelevant or mistaken premises cannot be justified by post hoc reasoning or by invoking change of opinion alone.

---