Change of opinion bars reassessment after four years when original scrutiny examined fully disclosed interest and investment records.

Reassessment initiated after four years was invalid where the assessee had fully disclosed interest expenditure and investments during the original scrutiny assessment. The disallowance issue had already been specifically examined, while the recorded reasons identified neither any failure of full and true disclosure nor subsequent tangible material. A fresh review of the same disclosed records amounted to a change of opinion; consequently, the reassessment notice was quashed.

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Issues: Whether reassessment initiated after four years of the relevant assessment year was valid where the assessee had disclosed interest expenditure and investments during the original scrutiny assessment and the proposed disallowance was based on re-examination of the same records.

Analysis: The original assessment was completed after scrutiny, during which the disallowance issue had been specifically examined. The recorded reasons did not identify any failure by the assessee to make a full and true disclosure of material facts, nor did they rely on tangible material obtained subsequent to the original assessment. The proposed reassessment rested on a fresh examination of the disclosed interest expenditure and investments and was therefore founded on a change of opinion.

Conclusion: The reassessment notice was invalid and was quashed, in favour of the assessee.

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