De novo income-tax assessment permits fresh additions on new income sources, with enquiry not limited to original issues.

When an assessment is set aside in full with directions for a fresh de novo assessment, the Income-tax Officer may make additions on sources of income not examined in the original proceedings. The officer is treated as standing in the same position as in an original assessment under section 143(3), so the enquiry is not confined to the earlier issues and may extend to any material found on fresh examination. The stated legal position thus favoured the Revenue on the referred question, although the reference was left unanswered because the assessee was absent.

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Issues: Whether, after the entire assessment was set aside with a direction to make fresh assessments de novo, the Income-tax Officer could make additions in respect of sources of income not considered in the original assessment proceedings.

Analysis: The assessment had been set aside in full with a direction to make fresh assessments de novo after making such enquiries as were considered necessary. In that situation, the Income-tax Officer stood in the same position as in an original assessment under section 143(3) of the Income-tax Act, 1961, and the scope of enquiry was not restricted. The fresh assessment could therefore be made on the basis of material available and due enquiries were not confined to the earlier points considered.

Conclusion: The legal position favoured the Revenue on the referred question, but the reference was not answered because the assessee was absent and the Court returned the reference unanswered.

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