Reassessment based on change of opinion and retrospective limitation extension was invalid where no new material emerged.

Reassessment under the Income-tax Act could not be sustained where the assessee had already disclosed all material facts and the issue of assessment capacity had been examined on the original record, making the reopening a mere change of opinion. The later enlargement of the limitation period was held inapplicable to the assessment year in question, and the Department could not rely on a prior appellate order to overcome the limitation bar. As no new material emerged, the reassessment was treated as not properly initiated and the challenge to reopening and limitation succeeded.

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Issues: Whether reassessment under the Income-tax Act was valid in the absence of any new material, and whether the extended limitation and retrospective provisions could justify reopening for the assessment year in question.

Analysis: The assessee had disclosed all material facts at the time of the original assessment, and the question whether the income was assessable in the capacity of an individual or as karta of a Hindu undivided family had already been examined on the existing record. On those facts, reopening was treated as a mere change of opinion, which could not sustain action under the reassessment provisions. The later enlargement of limitation was held inapplicable to the year under appeal, and the Department could not rely on the earlier appellate order to save limitation. As no new facts emerged, the reassessment was not held to be properly initiated.

Conclusion: The reassessment was invalid and the assessee succeeded on the challenge to reopening and limitation.

Ratio Decidendi: Reassessment cannot be sustained when it is founded only on a change of opinion on facts already disclosed, and a subsequently enlarged limitation period cannot be applied retrospectively unless the statute clearly so provides.

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