Tribunal has no power to enhance the assessment in appeal

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Tribunal has no power to enhance the assessment in appeal

  • Supreme Court in MCORP Global (P) Ltd., Vs. Commissioner of Income Tax reported in (2009) 309 ITR 0434. It was held that the Tribunal was not authorized to take back the benefit granted to the Assessee by the Assessing Officer and the Tribunal has no power to enhance the assessment.
  • Hon’ble Supreme Court in the case of Hukumchand Mills Ltd., Vs. CIT reported in (1967) 63 ITR 232 (SC).
  • The operative portion of the judgment reads as follows:
  • “6. In the case of Hukumchand Mills Ltd., Vs.CIT (1967) 63 ITR 232 (SC) this Court has held that under s.33(4) of the IT Act, 1922 [equivalent to s.254(1) of the 1961 Act]. The Tribunal was not authorized to take back the benefit granted to the assessee by the AO. The Tribunal has no power to enhance the assessment. Applying the ratio of the said judgment to the present case, we are of the view that in this case, the AO had granted depreciation in respect of 42,000 bottles out of the total number of bottles (5,46,000), by reason of the impugned judgment.
  • That benefit is sought to be taken away by the Department, which is not permissible in law. This is the infirmity in the impugned judgment of the High Court and the Tribunal.”
  • High Court of Gujarat in Fidelity Shares and Security Ltd., Vs. Deputy Commissioner of Income Tax reported in (2017) 390 ITR 0267 (Guj), wherein it was held that the Tribunal has no power under the Income Tax Act to enhance the assessment in appeal in view of the statutory provisions.
  •  Further it was held that the benefit, which was sought to be taken away by the Department, was not permissible in law and this is the infirmity in the judgment of the Tribunal as the Tribunal has no power to enhance the assessment in appeal.

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