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Section 251, read with section 147 of the Income-tax Act, 1961 - Commissioner (Appeals) - Powers of - Assessment year 1964-65 - Whether once AAC had come to conclusion that AO had no jurisdiction to reopen assessment under section 147(a), and order of assessment was liable to be quashed, he had no jurisdiction to make any further direction for recomputing amount of capital gains - Held, yes FACTS Initially the assessment was made on a total income which included income derived from capital gain on acquisition of certain land by the Government and from sale of certain house. The compensation for the acquired land was subsequently enhanced by the District Judge which was upheld in appeal by the High Court. The ITO, thereafter, initiated proceedings under section 147(a) and made addition in the income of the assessee by holding that the original capital gains computed stood enhanced as a result of the decision of the High Court. On appeal, the AAC, held that no case for reopening the assessment under section 147(a) was made out, and further directed the ITO to recomputed the amount of capital gains of the assessee in accordance with section 153(3)(ii). The Tribunal held that the direction given by the AAC for recomputation of capital gains was wholly unwarranted and redundant. On reference : HELD In the appeal preferred by the assessee before the AAC, the only question that required decision was whether the ITO had jurisdiction to reopen the assessment under section 147(a). Once the AAC came to the conclusion that the ITO had no jurisdiction to reopen the case under section 147(a ) and the order of reassessment was liable to be quashed, he had no jurisdiction to make any further direction for recomputing the amount of capital gains because such direction was not necessary for the disposal of the appeal before the AAC. For the foregoing reasons, the Tribunal was justified in law in holding that the direction given by the AAC was wholly unwarranted and redundant Note : The decision is in favour of the assessee. CASE REFERRED TO Rajinder Nath v. CIT [1979] 120 ITR 14 (SC). B.K. Rawat for the Applicant. G.M. Purohit for the Respondent. JUDGMENT K.M. Agarwal, J.- This…

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