Reassessment beyond four years fails where the issue was already examined and reopening rests on a mere change of opinion.

Reassessment beyond four years under Section 147 is valid only where the assessee failed to fully and truly disclose material facts. Here, the deduction claim and supporting form had already been queried in the original assessment, and the assessee had provided explanations and approvals, so the issue was treated as examined even though the assessment order was silent. The recorded reasons therefore reflected a mere change of opinion, which cannot justify reopening. The reopening was also weakened because it relied on revenue audit objections rather than an independently formed belief by the Assessing Officer. The Section 148 notice and the order rejecting objections were quashed.

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Issues: Whether reassessment notice issued beyond four years from the end of the relevant assessment year was valid when the original assessment had considered the deduction claim and there was no failure by the assessee to fully and truly disclose material facts.

Analysis: The reassessment notice pertained to an assessment year more than four years old, so the proviso to Section 147 applied. During the original assessment, the Assessing Officer had raised queries on the deduction claim and the related form, and the assessee had furnished explanations and supporting approvals. Once a query is raised and answered, the matter is treated as having been considered in the original assessment even if the order does not discuss it expressly. The recorded reasons therefore reflected a mere change of opinion. The reopening was also founded on revenue audit objections, but the belief required for reassessment had to be formed independently by the Assessing Officer. The reasons did not disclose the audit basis, which further undermined the reopening.

Conclusion: The reassessment was invalid as there was no failure to make a full and true disclosure and the reopening was based on a change of opinion. The notice under Section 148 and the order rejecting objections were liable to be quashed.

Final Conclusion: The challenge to the reassessment succeeded and the impugned reopening proceedings were annulled.

Ratio Decidendi: Where reassessment is initiated beyond four years, it can stand only on a demonstrable failure by the assessee to fully and truly disclose material facts, and a reassessment based on an issue already examined in the original proceedings amounts to an impermissible change of opinion.

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