Change of opinion bars reassessment where reopening rests on the same material already examined in scrutiny assessment.

Reassessment under sections 147 and 148 could not be sustained where a scrutiny assessment under section 143(3) had already examined the return, accounts, audit report and notes, and the reopening relied on no fresh tangible material. The reassessment reasons merely re-examined the same material previously considered, so the statutory "reason to believe" requirement was not met and the action amounted to an impermissible change of opinion. The reassessment notice and order were therefore quashed, while the merits of the additions were left undecided.

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Issues: Whether the reassessment proceedings were validly initiated under sections 147 and 148 of the Income-tax Act, 1961, or were barred as a mere change of opinion in the absence of fresh tangible material.

Analysis: The original assessment had been completed under section 143(3) after scrutiny of the return, computation of income, balance sheet, profit and loss account, tax audit report, and the relevant note to accounts. The reasons recorded for reopening did not disclose any new external material or information coming to the Assessing Officer after the original assessment. Instead, the reopening was founded on re-examination of the very same material already considered earlier. On these facts, the jurisdictional condition of "reason to believe" based on tangible material was not satisfied, and the attempted reopening amounted to an impermissible review of the concluded assessment.

Conclusion: The reassessment notice and the reassessment order were invalid and were quashed, as the reopening was based only on a change of opinion.

Final Conclusion: The assessee succeeded on the jurisdictional challenge, and the appeal was allowed with the merits left undecided.

Ratio Decidendi: Reassessment under sections 147 and 148 cannot be sustained where the Assessing Officer seeks to reopen a completed scrutiny assessment on the basis of the same material already examined earlier, without any new tangible material.

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