TMI Blog1997 (3) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellate Assistant Commissioner while dealing with appeals against orders of Assessing Officers under section 251 of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). The matter relates to the assessment year 1956-57. Nirbheram Daluram (hereinafter referred to as "the assessee") is a partnership firm carrying on business in grains, rice, gunny bags and oil seeds, etc. Under order dated March 11, 1957, assessment was originally made on a total income of Rs. 28,724. On reassessment in proceedings initiated under section 147 of the Act the Income-tax Officer included in the total income a sum of Rs. 2,45,000 referable to ostensible transactions in hundi loans shown by the assessee. The assessee filed an appeal against the said a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istant Commissioner had no jurisdiction to consider the new entries which were not considered at all by the Income-tax Officer and to add the amount of Rs. 2,30,000 to the total income of the assessee. According to the High Court, the items containing that amount constituted new sources of income which were not the subject-matter of assessment before the Income-tax Officer and, therefore, it was not open in appeal to consider these sources and to assess them. In taking this view, the High Court has placed reliance on the decision of this court in Addl. CIT v. Gurjargravures Pvt. Ltd. [1978] 111 ITR 1, wherein it was held that the Appellate Assistant Commissioner had no power to grant exemption under section 84 of the Act since the Income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment and direct the Income-tax Officer to make a fresh assessment. The Appellate Assistant Commissioner has, therefore, plenary powers in disposing of an appeal. The scope of his power is conterminous with that of the Income-tax Officer. He can do what the Income-tax Officer can do and also direct him to do what he has failed to do." After referring to these observations, this court in Jute Corporation of India Ltd. [1991] 187 ITR 688 has stated : "The above observations are squarely applicable in the interpretation of section 251(1)(a) of the Act. The declaration of law is clear that the power of the Appellate Assistant Commissioner is coterminous with that of the Income-tax Officer, and if that is so, there appears to be no reason as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ht to the notice of the Bench in Gurjargravures Pvt. Ltd. [1978] 111 ITR 1 (SC). In the circumstances, the view of the larger Bench in Kanpur Coal Syndicate case [1964] 53 ITR 225 (SC) holds the field." Having regard to the decision in Jute Corporation of India Ltd. [1991] 187 ITR 688 (SC), it must be held that the High Court was in error in holding that the appellate power conferred on the Appellate Assistant Commissioner under section 251 was confined to the matter which had been considered by the Income-tax Officer and the Appellate Assistant Commissioner exceeded his jurisdiction in making an addition of Rs. 2,30,000 on the basis of the other 10 items of hundis which had not been explained by the assessee. This means that even if ques ..... X X X X Extracts X X X X X X X X Extracts X X X X
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