Reassessment invalid where reopening rested on incorrect information, no independent verification, and suspicion instead of reason to believe.

Reassessment proceedings were treated as jurisdictionally defective where reopening rested on patently incorrect information, with no independent verification or application of mind by the Assessing Officer. The record did not support the claimed SEBI-based premise for reopening in relation to the relevant scrip, and the initiation was viewed as based on suspicion rather than the statutory standard of reason to believe. On those facts, the reassessment was held invalid.

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Issues: Whether reassessment proceedings were valid when the reopening was based on allegedly incorrect information, without independent verification or application of mind, and on suspicion rather than reason to believe.

Analysis: The reopening was found to suffer from jurisdictional defects. The information on which the Assessing Officer acted was treated as patently incorrect, and there was no independent verification or application of mind before initiating reassessment. The record also did not show material supporting the claimed SEBI-based premise for reopening in relation to the relevant scrip. The reassessment was viewed as having been initiated on suspicion, whereas the governing standard is reason to believe.

Conclusion: The reassessment was held invalid, and the Revenue's challenge failed.

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