Appellate revision power cannot introduce undisclosed income; such income requires remand or escaped-income statutory procedures under assessment law.

Whether an appellate authority may assess an undisclosed new source is resolved by treating Section 31(3) as a revisional power confined to the assessment record: the Appellate Assistant Commissioner may enhance, confirm, reduce or annul an assessment only in respect of matters before or considered by the assessing officer, and cannot independently travell outside that record to introduce and tax a new source of income; such undisclosed or escaped income must be addressed by remand for fresh assessment or under the statutory procedures for escaped income, not by direct appellate assessment.

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Issues: Whether, in an appeal filed by an assessee, the Appellate Assistant Commissioner (under Section 31) can discover and assess a new source of income not disclosed in the return and not considered by the Income-tax Officer.

Analysis: Section 31(3) empowers the Appellate Assistant Commissioner to enhance an assessment, confirm, reduce, annul, or set aside and direct fresh assessment. Competing statutory provisions (Sections 33B and 34) provide specific mechanisms for bringing escaped income from new sources to tax. Judicial authorities over several decades have interpreted the appellate power as a revisional jurisdiction confined to matters that were before or considered by the Income-tax Officer, with remand available where additional inquiry or fresh assessment is necessary. The interpretation that an appellate authority may itself travel outside the record to assess entirely new sources would bypass the statutory procedures for escaped income and the right of further appeal available when fresh assessment procedures are followed.

Conclusion: The Appellate Assistant Commissioner cannot, in disposing of an appeal under Section 31, assess new sources of income that were neither disclosed in the return nor considered by the Income-tax Officer; such matters should be dealt with by remand or under the specific provisions for escaped income.

Final Conclusion: The appellate power to enhance an assessment under Section 31(3) is limited to revising matters within the scope of the assessment record and does not authorize the Appellate Assistant Commissioner to independently introduce and assess new undisclosed sources of income; the appropriate course for such matters is remand or invocation of the statutory procedures for escaped income.

Ratio Decidendi: Section 31(3) does not empower the Appellate Assistant Commissioner to independently assess new sources of income not before the Income-tax Officer; escaped income from new sources must be brought to tax under the procedures of Sections 33B and 34 or by remand to the assessing officer.

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