Failure to quantify escaped income over statutory threshold renders reassessment notice beyond four years legally unsustainable.

The petitioner, a trader in ferrous and non-ferrous items, underwent a scrutiny assessment under Section 143(3) of the Income Tax Act, 1961, for A.Y. 2012-13, which concluded on 13.03.2015

During that assessment, the petitioner provided details of "sundry debtors," including transactions with M/s. Shoryaraj Enterprise

On 28.03.2019, nearly six years after the end of the A.Y., the Revenue issued a notice under Section 148 to reopen the assessment based on information from the Investigation Wing alleging that M/s. Shoryaraj Enterprise provided "accommodation entries"

The petitioner objected, noting that the Revenue possessed the statement of the proprietor of Shoryaraj Enterprise (recorded on 20.03.2014) prior to the original assessment and failed to quantify the escaped income

The objections were disposed of by the Revenue on 09.12.2019

1. Whether the notice for reopening the assessment was valid under Section 149(1)(b) of the Act in the absence of specific quantification of the alleged escaped income exceeding Rs. 1,00,000

2. Whether the reopening of assessment constituted a mere "change of opinion" given that the transactions were examined during the original scrutiny assessment

The court applied Section 149(1)(b) of the Income Tax Act, 1961, which mandates that no notice under Section 148 can be issued after four years (but within six years) unless the income chargeable to tax which has escaped assessment is likely to amount to Rs. 1,00,000 or more

It relied on the precedent set by the Allahabad High Court in Mahesh Kumar Gupta v. CIT, which established that the Assessing Officer must explicitly state in the reasons recorded that the escaped income is Rs. 1 Lakh or more to satisfy the sanctioning authority and meet the statutory threshold for the extended limitation period

The court found that the reasons recorded by the Assessing Officer merely listed debit and credit entries and alleged "high value transactions" without quantifying the specific amount of income that escaped assessment

Since the notice was issued beyond the four-year mark, the failure to demonstrate that the escaped income met the Rs. 1,00,000 threshold under Section 149(1)(b) rendered the notice jurisdictionaly defective

Furthermore, the court observed that the Revenue already possessed the incriminating statement of the third-party proprietor in 2014—a year before the original scrutiny assessment was finalized—yet the Assessing Officer chose not to make any additions at that time

The court reasoned that reopening the case on the same facts, after they were previously disclosed and examined, amounted to an impermissible change of opinion, especially since the Revenue failed to explain when exactly the "new" information was received

The High Court allowed the writ petition and quashed the impugned notice dated 28.03.2019 and the subsequent order dated 09.12.2019