Law:

Section:

Section 264 of the Income-tax Act, 1961 - Revision of other orders - Assessment year 1976-77 - ITO disallowed assessee's claim for depreciation in respect of a bus and Commissioner, on revision under section 264, upheld ITO's order holding that bus had not been put to use in relevant previous year - Record showed that Commissioner, had not taken into account material relied upon assessee to effect that State Government instituted a suit against assessee under section 112/123 of Motor Vehicles Act, 1939 on 27-3-1976 on allegation that assessee was found plying vehicle without permit - Whether Commissioner was wrong in disallowing assessee's claim for depreciation and matter required to be considered by him afresh in light of material relied upon by assessee - Held, yes FACTS For the relevant assessment year 1976-77, the ITO disallowed the assessee's claim for depreciation in respect of a bus. On revision under section 264, the Commissioner upheld the order of the ITO holding that the bus had not been put to use in the relevant previous year inasmuch as the TRO had given for the first time a temporary permit for the period 14-4-1976 to 13-8-1976. On writ, the assessee contended that the findings recorded by the Commissioner were misconceived and were not based on the relevant material that was placed before him during the course of hearing inviting the attention of the Commissioner to a case instituted by the State Government against the assessee under section 112/123 on 27-3-1976 on the allegation that the assessee was found plying the vehicle without permit. The assessee thus, urged that the bus, in fact, was plied prior to the end of the relevant previous year. HELD A perusal of the order passed by the Commissioner revealed that the Commissioner had not addressed himself to the material that was alleged to have been filed before him. It is a salutary principle of law that if a decision is arrived at by a quasi-judicial authority or court without taking into consideration the material which had bearing on the final decision, such decision is not liable to be sustained and is vitiated in law. As the material relied upon by the assessee was not taken into account…

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