A completed scrutiny assessment cannot be reopened on mere change of opinion without fresh tangible material.

For AY 2016–17, the assessee disclosed a long-term capital loss of ₹89,20,626 arising from his share in the sale of two agricultural lands.

The return was scrutinised under Section 143(3) of the Income Tax Act, 1961; the Assessing Officer sought details concerning the land transactions and the capital-loss computation, which the assessee supplied, and the assessment order dated 20 December 2018 did not disturb the claimed loss.

After the assessee’s death, the Department initiated reassessment proceedings concerning the same transactions. Following the legal heir’s responses, the Assessing Officer passed an order under Section 148A(d) on 29 March 2023, finding alleged escaped income of ₹1,57,65,733, and issued a notice under Section 148 the next day.

The legal heir challenged both instruments by writ petition.

Whether reassessment could be initiated on the basis of the same land-sale transactions and capital-loss claim already examined in the original scrutiny assessment, absent fresh tangible material.

Whether the order under Section 148A(d) and the consequent notice under Section 148 were liable to be quashed as based on a change of opinion.

Sections 148 and 148A(d) of the Income Tax Act, 1961 govern the issuance of a reassessment notice and the antecedent determination whether it is a fit case to issue such notice.

The judgment applied the principle that reassessment cannot be founded merely on a change of opinion where the relevant issue was examined in the original scrutiny assessment and no fresh tangible material justifies reopening.

The petitioner cited Commissioner of Income Tax, Delhi v. M/s Kelvinator of India Ltd., (2010) 320 ITR 561, in support of the change-of-opinion principle.

The Court found that the original assessment involved specific inquiries into the sale of the lands, the consideration, and the computation of the capital loss. The assessee had supplied the requested documents and explanations, and the Assessing Officer accepted the loss in the Section 143(3) assessment.

The later proceedings questioned the same transactions, while the Court found no fresh tangible material or information warranting reopening.

It therefore held that the impugned order and notice rested on a mere change of opinion.

The petition was allowed and the Rule made absolute.