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Issues:
1. Competence of the Appellate Tribunal to pass a supplementary order. 2. Determination of the 'previous year' for including undisclosed income in the total income of the assessee. Analysis: Issue 1: Competence of the Appellate Tribunal The case involved a reference under section 66(1) of the Income-tax Act regarding the competence of the Appellate Tribunal to pass a supplementary order. The Appellate Tribunal had corrected the assessment year for an undisclosed income of Rs. 26,000, which was initially assessed for the year 1947-48 but later directed to be assessed for the year 1946-47. The Department contended that the Tribunal's correction was incompetent as the previous order on the appeal had become final. However, the Tribunal clarified that it passed a supplementary order to complete the appeal regarding the undisposed ground. The High Court analyzed the provisions of sections 33 and 35 of the Income-tax Act and concluded that the Tribunal had the authority to rectify the mistake under section 35, even if it did not expressly state so. The Court referred to previous judgments supporting the Tribunal's power to rectify such errors that are apparent on the face of the record. Issue 2: Determination of the 'previous year' The second issue revolved around determining the 'previous year' for including the undisclosed income of Rs. 26,000 in the assessee's total income. The Appellate Tribunal rectified the assessment year to be 1946-47 instead of 1947-48. The High Court examined the nature of the income, emphasizing that it was from an undisclosed source related to buying and selling notes, not the regular business of the assessee. Referring to section 2(11) of the Income-tax Act, the Court established that in the absence of an option by the assessee, the income should be considered in the previous year of accounting. The Court upheld the Tribunal's decision to rectify the mistake regarding the assessment year, as it was a clear error apparent on the face of the record. In conclusion, the High Court affirmed the competence of the Appellate Tribunal to pass the supplementary order under section 35 of the Income-tax Act. The Court did not find it necessary to answer the second question regarding the determination of the 'previous year' for the undisclosed income, as the Tribunal's decision to assess it for the year 1946-47 was deemed correct. The Court noted that the assessee's right to bring the case for adjudication was preserved, despite the Tribunal's initial oversight, and decided against awarding costs due to the inadvertent nature of the mistake rectification.
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