Law:

Section:

Income-tax Act (XI of 1922), S. 31 (3) (a)-Appeal-Powers of Appellate Assistant Commissioner-Power to enhance assessment -Whether includes power to levy tax on new sources not mentioned in return or considered by Income-tax Officer.   In an appeal filed by the assessee the Appellate Assistant Commissioner has no power to enhance the assessment by discover ing new sources of income not mentioned in the return of the assessee or considered by the Income-tax Officer in the order appealed against.   Shapoorji Pallonji Mistry v. Commissioner of Income-tax (1958) 34 I T R 342 affirmed.   Bishwanath Prasad Bhagwat Prasad v. Commissioner of Income-tax (1956) 29 I T R 748 ; Commissioner of Income-tax v.McMillan & Co. (1958) 33 I T R 182 ; Gajalakshmi Ginning Factory v. Commissioner of Income-tax (1952) 22 I T R 502 ; Jagarnath Therani v. Commissioner of Income-tax (1925) I L R 4 385 and Narrondas Manordass v. Commissioner of Income-tax (1957) 31 I T R 909 ref. JUDGMENT   HIDAYATULLAH, J.-The assessee, who is the respondent here, had received on July 20, 1946, a sum of Rs. 40,000. In the proceedings for assessment for the assessment year, 1946-47, this came to the notice of the Income-tax Officer. Since the receipt fell within the accounting year relative to the assessment year, 1947-48, the Income-tax Officer did not assess the amount, making a note, "The question will however be considered again at the time of 1947-48 assessment." In the return filed for the assessment year, 1947-48, this amount was not shown by the assessee. The Income-tax Officer also overlooked the note at the end of his order in the back year's assessment, with the result that this item was omitted. The assessee appealed to the Appellate Assistant Commissioner against his assessment for the year, 1947 48. While the appeal was pending, the Income-tax Officer wrote a letter to the Appellate Assistant Commissioner intimating him that he would like to be present, and also requesting him to assess the amount of Rs. 40,000. The Appellate Assistant Commissioner, after issuing notice, assessed the amount and included it in the original assessment. The contention of the…