Incompatible types in assignment when a with block has inner method

[jayaseelan-james]

Bug Report

mypy reports an Incompatible types in assignment error when the variable name defined is same across "with" blocks and any of the "with" block contain an inner method. I hope this is on the lines of #15605 and a possible variant of #12246.

To Reproduce

Please use the below code:

with open('file1', 'r') as f:
    def do_something(x: int, y: int) -> int:
        return x + y
    
    do_something(2, 3)

with open('file2', 'rb') as f:
    pass

Expected Behavior

Type check passes.

Actual Behavior

I observed the following error:

main.py:7: error: Incompatible types in assignment (expression has type "BufferedReader", variable has type "TextIOWrapper") [assignment]

Your Environment

• Mypy version used: 1.6.1
• Mypy command-line flags: None, just ran mypy main.py
• Mypy configuration options from mypy.ini (and other config files): None
• Python version used: 3.9.13

[chriselion]

A (maybe) simpler repro:

with open("my_file.json") as f:
    pass

with open("my_file.bin", 'rb') as f:
    pass

def noop():
    pass

with output

main.py:4: error: Incompatible types in assignment (expression has type "BufferedReader", variable has type "TextIOWrapper")  [assignment]
Found 1 error in 1 file (checked 1 source file)

(playground)

Interestingly, if you comment out the noop() function, the error goes away.