Law: Income Tax Act, 1961

Section: 256

[Indian Income Tax Act, 1961]..........Section 256--Reference to High Court- Question of law arising out of Tribunals order-Tribunal not dealing with a point not necessary to decide-Appeal disposed of on other material-Non-consideration of contention-Whether gives rise 10 question of law- Held no. After rejecting the books of the assessee, the Income Tax Officer made a best assessment on the assessee, fixing the margin of profit at 815% on the basis of two comparable cases. On appeal to the Appellate Assistant Commissioner, the assessee contended that the data collected by the Income Tax Officer had not been disclosed to the assessee and, therefore, there had been violation of the principles of natural justice and the provisions of Section 142(3) of the Income Tax Act, 1961. The Appellate Assistant Commissioner did not consider this contention but confirmed the order of the Income Tax Officer on the basis that for the earlier year, the assessee himself had shown a margin of profit of 10%. The assessee raised the same contention on further appeal to the Appellate Tribunal. The Tribunal also did not deal with the assessees contention but confirmed the order of the Appellate Assistant Commissioner on the same ground as was adopted by the Appellate Assistant Commissioner. On a reference: Held, that if it was unnecessary to consider the contention raised, as the case could be disposed of on other material, and was in fact disposed of on other material, the fact that the assessee had raised a contention, the consideration of which was unnecessary for disposing of the appeal and the fact that that contention had not been considered, would not give rise to a question of law which could be said to arise from the order of the Tribunal. A question of law could be said to arise from an order of the Tribunal when a consideration of that question was necessary for disposing of the appeal before the Tribunal. The court declined to answer the question referred. Cases referred to: CIT v. Scindia Steam Navigation Co. Ltd. [1961] 42 ITR 589 (SC) and Gnanambika Mills Ltd. v. CIT [1965] 58 ITR 802 (Mad). JUDGMENT [The judgment of the court was delivered by GOVINDAN Nair C. J.]- The…

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