TMI Blog1999 (9) TMI 81X X X X Extracts X X X X X X X X Extracts X X X X ..... 1, 3, 8, 10 and (sic) mentioned in the order of the Appellate Assistant Commissioner dated May 4, 1973 ?" The reference relates to the assessment year 1967-68 for which the accounting period ended on March 31, 1967. The assessee is an individual and deals in tyres. In this return for the relevant assessment year, the assessee declared a loss of Rs. 4,552 which was revised to Rs. 3,500. The said loss was computed by applying the rate of gross profit at 0.9 per cent. on the total sales of Rs. 11.75 lakhs. During the course of assessment proceedings the assessee did not produce any books of account. The Income-tax Officer estimated the sales at Rs. 11.85 lakhs and by applying a gross profit rate of 3.5 per cent., he made an addition of Rs. 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ash or credit basis, wholly or partly. The Income-tax Officer will obtain a list of sales and purchases made on credit basis exceeding Rs. 1,000 in each case. 5. Whether the appellant is a registered dealer under the Sales Tax Act ? 6. Whether the appellant has obtained registration under the Shops and Establishment Act ? 7. Whether any sales tax assessment has been made. 8. The business connections of the appellant with any business/businesses carried on by the appellant's close relatives. 9. G. P. rate declared by other similar business assessees in the locality. 10. A bank reconciliation statement to be obtained. 11. Name of the employees whole-time/part-time." Aggrieved by the said directions and alleging that the Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee against an order of assessment to confirm, reduce, enhance or annul the assessment or to set aside and refer the case back to the Income-tax Officer for making a fresh assessment in accordance with the directions given by the Appellate Assistant Commissioner. The Explanation to section 251 provides that the Appellate Assistant Commissioner may hear and decide any matter arising out of the proceedings in which the order appealed against was passed notwithstanding that such a matter was not raised before the Appellate Assistant Commissioner by the appellant. The issue with regard to the scope of powers of the first appellate authority in disposing of an appeal has come up before the courts umpteen times but we do not propose to bur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of assessment before it, referred to Shapoorji's case [1962] 44 ITR 891 (SC), but drew a distinction between the power to enhance tax on discovery of a new source of income and granting of deduction on the admitted facts, supported by the decision of the Supreme Court. Relying on the observations of the apex court in CIT v. Kanpur Coal Syndicate [1964] 53 ITR 225, the court, however, held that powers of the Appellate Assistant Commissioner are co-terminous with those of the Income-tax Officer and the appellate authority is vested with all the plenary powers which the subordinate authority may have in the matter. A question regarding powers of the first appellate authority came up for consideration before the Supreme Court recently in CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icant limitation to the power of revision, viz., that it is not open to the Appellate Assistant Commissioner to introduce in the assessment a new source of income and the assessment has to be confined to those items of income which were the subject-matter of original assessment. Applying the above well settled principles of law to the facts of the instant case, we are of the view that the Tribunal was justified in holding that in calling for a remand report on the aforenoted four points the Appellate Assistant Commissioner had exceeded his jurisdiction. While computing the total business income of the assessee, the Assessing Officer had estimated the sales at an enhanced figure and had applied a higher rate of gross profit. Thus, the only ..... X X X X Extracts X X X X X X X X Extracts X X X X
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