Reassessment requires new tangible material; recipient cash withdrawals cannot reopen previously scrutinised and disclosed purchase transactions.

Reassessment cannot be reopened merely because investigation information shows subsequent cash withdrawals by a payment recipient where the assessee had disclosed and substantiated the underlying purchase transactions in the original scrutiny assessment. Invoices for cotton purchases had already been examined under Section 143(3), while the recipient proprietor's cash withdrawals did not provide new tangible material showing that the assessee's income had escaped assessment. Such reopening constitutes a fishing and roving inquiry and an impermissible change of opinion. The reassessment notice was quashed.

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Issues: Whether reassessment could validly be reopened where the assessee had disclosed the relevant transactions during the original scrutiny assessment and the reopening was founded on investigation information concerning subsequent cash withdrawals by the recipient concern.

Analysis: The payments to the recipient concern, made towards cotton purchases, had been disclosed through invoices and were subjected to scrutiny in the assessment under Section 143(3). The investigation report merely raised suspicion because the recipient's proprietor withdrew funds in cash; it disclosed no new tangible material indicating escapement of the assessee's income. Reopening on those facts amounted to a fishing and roving inquiry and a change of opinion.

Conclusion: The reassessment notice lacked a valid reason to believe that income had escaped assessment and was quashed. The issue was decided in favour of the assessee.

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