1979 (6) TMI 76

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..... cupied property at Rs. 100. 3. The ITO in a brief assessment order for both the years estimated income from truck plying at Rs. 8,000 and Rs. 9,000 respectively for the assessment years under appeal. Thus there was an addition of Rs. 1,000 for each assessment year. 4. The assessee appealed against the order of the ITO. In his appeals, the assessee claimed that the income shown by him from truck plying at Rs. 7,000 and Rs. 8,000 should have been accepted. 5. The learned AAC allowed the appeal for the asst. yr. 1972-73 and deleted the addition of Rs. 1,000 in truck plying business. However, while computing net income, the AAC evolved a formula which was not considered by the ITO nor claimed by the assessee in the return. The learned AAC .....

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..... be calculated and allowed when the same was not claimed by the assessee and for which no particulars were given, as required under s. 34(1) of the I.T. Act. 9. As regards the first point, we find that the assessee is on a strong ground. s.251 (1)(a) of the I.T. Act empowers the AAC to enhance the assessment after complying with certain requirements. But limitations to this power have been laid down by the Supreme Court in two leading decisions. In CIT vs. Shapurji Pallonji Mistry(1), it was held that in an appeal filed by the assessee the AAC has no power to enhance the assessment by discovering new sources of income not mentioned in the return by the assessee or considered by the ITO in the order appealed against. This view was followed .....

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..... of the Allahabad High Court in Archarilal Ram Parkash vs. CIT(4) wherein the Court has taken the view that merely because the assessee did not file the necessary particulars in the return it could not be said that ITO did not have jurisdiction to grant depreciation allowance. The cited case is similar on facts to the case of the assessee before us and following the decision we hold that the ITO or the AAC was competent to allow depreciation even if the same was not claimed in the return. Shri Nema cited another case of Allahabad High Court, Badriprasad Jagan Prasad vs. CIT(5) wherein it was held that profits under s. 10(2) (vii) of the 1922 Act could not be added to the income because no depreciation had been allowed after the purchase of t .....

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