Remand for further inquiry permits fresh evidence on account books; appellate power is not limited by the original assessment record.

Under section 31(2) of the Indian Income-tax Act, 1922, a remand for further inquiry is not confined to the material already considered in the original assessment, because the provision contains no restriction on the scope of the inquiry directed on remand. Fresh evidence, including the assessee's account books not previously produced, may therefore be received and considered by the Income-tax Officer on remand. Order XLI, rule 27 of the Code of Civil Procedure was held inapplicable, as it governs the admission of additional evidence in appeal and not the power to order remand. The weight of the account books was not in issue.

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Issues: Whether, in a remand order made under section 31(2) of the Indian Income-tax Act, 1922, the Appellate Assistant Commissioner could permit the Income-tax Officer to take into consideration account books of the assessee which had not been produced before the original assessment.

Analysis: Section 31(2) contains no restriction limiting the scope of further inquiry directed on remand. A remand for further inquiry necessarily contemplates the reception and consideration of fresh evidence, and account books of the assessee fall within that description. The provision in Order XLI, rule 27, of the Code of Civil Procedure was held inapplicable because it concerns the right to adduce further evidence in appeal and not the power to direct remand. The weight to be attached to the account books was not in issue.

Conclusion: It was open to the Appellate Assistant Commissioner to direct or permit the Income-tax Officer to consider the assessee's account books on remand.

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