Reopening of escaped expenditure-tax assessment upheld where prior assessment rested on the wrong charging provision and finality did not apply.

A writ of prohibition was unavailable because the Expenditure-tax Officer had jurisdiction to reopen assessment under section 16 when information created a reasonable belief that income had escaped assessment. The earlier assessment, made under a different charging provision, did not finally determine the applicability of the correct clause, and a prior error of law did not prevent lawful reassessment. Information from a competent judicial pronouncement could support reopening. The reassessment notice was therefore sustained, and the assessee was left to raise objections before the assessing authority in the reopened proceedings.

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Issues: Whether a writ of prohibition should issue to prevent the Expenditure-tax Officer from reopening the assessment under section 16 of the Expenditure-tax Act, 1957, on the basis that the earlier assessment had proceeded on a different statutory provision and had attained finality.

Analysis: A writ of prohibition lies only where the authority lacks jurisdiction or clearly exceeds it. The earlier assessment had proceeded on the footing of one charging provision, but the revenue sought to reopen the matter on the basis of later information indicating that the correct charging provision was another clause of section 4. The earlier proceedings did not finally decide the applicability of that other clause, and the doctrine of finality could not prevent reopening where the statutory conditions for section 16 were satisfied. Information derived from a competent judicial pronouncement could constitute the basis for a reasonable belief that income had escaped assessment. A mere earlier misapplication of law did not bar the authority from correcting the assessment through lawful reopening.

Conclusion: The notice for reopening was within jurisdiction, and no ground for prohibition was made out. The issue is decided against the assessee and in favour of the revenue.

Final Conclusion: The petition challenging the reassessment notice failed, leaving the assessee to urge all available objections before the assessing authority in the reopened proceedings.

Ratio Decidendi: Where the statutory preconditions of information and reasonable belief of escapement are present, a prior assessment concluded on an erroneous view of law does not bar reopening, and prohibition will not issue unless patent want of jurisdiction is shown.

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