Court upholds decisions on lease transactions, disallowed depreciation, and confirms block assessment procedural correctness.

The court dismissed the appeals, affirming that Section 154 cannot be used to introduce new issues or reargue settled matters. It upheld the decisions on fictitious lease transactions, disallowed depreciation, and included lease rental income. The court also confirmed the procedural correctness of the block assessment and surcharge levy, dismissing the appeals with no costs.

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Issues Involved:
1. Interpretation and applicability of Section 154(1A) of the Income-tax Act.
2. Entitlement to seek rectification under Section 154 despite previous judicial decisions.
3. Validity of lease transactions and the resulting depreciation and income claims.
4. Inclusion of lease rental income in total income despite disallowance of depreciation.
5. Levy of surcharge in block assessment under Chapter XIV-B.
6. Procedural issues regarding the approval of block assessment orders.
7. Principles of natural justice and denial of opportunity to cross-examine witnesses.

Issue-Wise Detailed Analysis:

1. Interpretation and Applicability of Section 154(1A):
The court analyzed Section 154(1A), which allows rectification of any matter other than those considered and decided in appeal or revision. The court emphasized that rectification is intended to correct mistakes apparent on the face of the record, not to introduce new issues or reargue settled matters. The court concluded that the appellant's plea to delete lease income was not permissible under Section 154(1A) since it was a new issue not previously considered.

2. Entitlement to Seek Rectification Under Section 154 Despite Previous Judicial Decisions:
The appellant argued that despite adverse decisions from the Tribunal, High Court, and Supreme Court, they could still seek rectification under Section 154. The court rejected this argument, stating that the scope of rectification is limited to correcting obvious and patent mistakes, not to re-litigate issues already decided by higher judicial authorities.

3. Validity of Lease Transactions and Resulting Depreciation and Income Claims:
The appellant's lease transactions were found to be fictitious, leading to the disallowance of depreciation claims. The court upheld this finding, relying on the statement of the managing director and other evidence. The Tribunal and High Court had previously confirmed that the transactions were bogus and the depreciation claims were rightly disallowed.

4. Inclusion of Lease Rental Income in Total Income Despite Disallowance of Depreciation:
The appellant contended that if the lease transactions were deemed fictitious, the lease rental income should also be excluded from the total income. The court held that this issue was not raised in the original appeal and could not be introduced through a rectification application. The court noted that the income from the lease was treated as income from financial transactions, which the appellant had accepted.

5. Levy of Surcharge in Block Assessment Under Chapter XIV-B:
The appellant challenged the levy of surcharge in the block assessment. The court found that this issue was not raised in the original appeal and could not be introduced in a rectification application. The court also noted that the appellant had pursued this issue in parallel proceedings, which is not permissible.

6. Procedural Issues Regarding Approval of Block Assessment Orders:
The appellant argued that the block assessment order was issued without the required approval from the Commissioner of Income-tax. The court found that the Tribunal had verified the records and confirmed that the approval was obtained as required. This procedural issue was thus resolved against the appellant.

7. Principles of Natural Justice and Denial of Opportunity to Cross-Examine Witnesses:
The appellant claimed a violation of natural justice, arguing they were not given an opportunity to cross-examine witnesses or access certain documents. The court rejected this claim, noting that the Tribunal had found no such violation. The court emphasized that the appellant had the opportunity to raise these issues in the original appeal but failed to do so.

Conclusion:
The court dismissed the appeals, holding that the appellant could not use Section 154 to introduce new issues or reargue settled matters. The court affirmed that the issues of fictitious lease transactions, disallowance of depreciation, and inclusion of lease rental income were correctly decided in the original proceedings. The court also upheld the procedural correctness of the block assessment and the levy of surcharge. The appeals were dismissed with no order as to costs.

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