Reassessment on audit objection fails where facts were already disclosed and reopening rests only on change of opinion.

Reopening under the Income-tax Act based on an audit objection was invalid where the relevant entry and supporting particulars had already been disclosed in the original assessment. Because no new fact emerged and the audit party supplied no information beyond what was already before the assessing authority, the reassessment rested only on a later change of opinion about an examined matter. On those facts, there was no omission or failure by the assessee and no material enabling reassessment under section 147. The reassessment was therefore held to be bad in law and the reopening was quashed.

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Issues: Whether reassessment initiated on the basis of an audit objection was valid under section 147(a) or section 147(b) of the Income-tax Act, 1961, when the relevant entry and supporting details had already been disclosed in the original assessment.

Analysis: The disputed amount had been shown in the return and supporting particulars were already before the assessing authority at the original assessment stage. Since no new fact came to light and the audit party did not supply information not already available to the assessing authority, the reopening was based only on a later change of view regarding an already examined matter. On these facts, there was neither omission or failure on the part of the assessee nor information enabling reassessment under the cited provisions.

Conclusion: The reassessment was held to be bad in law and the reopening was invalid. The appeal succeeded and the reassessment order was quashed.

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