Law:

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Section 254 of the Income-tax Act 1961, read with rule 11, of the Income-tax (Appellate Tribunal) Rules, 1963 - Appellate Tribunal - Powers of - Whether Tribunal could permit assessee to raise plea of jurisdiction of Assessing Officer to initiate reassessment proceedings for first time before it when such a plea had not been raised either before Assessing Officer or before first appellate authority - Held, yes FACTS On instant application under section 256(2) at the instance of revenue, the question raised was whether the Tribunal could permit the assessee to raise the plea of jurisdiction of the Assessing Officer to initiate reassessment proceedings for the first time before it which was not raised either before the Assessing Officer or before the first appellate authority. HELD The power of the Tribunal to permit any party to the appeal to raise the question of jurisdiction, which goes to the root of the matter and does not involve further investigation into facts, cannot be disputed on the plain reading of rule 11. Indeed, on such a plea being taken, the Tribunal is under a statutory obligation not only to entertain the plea but also to decide the same after providing sufficient opportunity of being heard to the other side. There was nothing in the instant case to show that the Tribunal had not provided sufficient opportunity to the revenue before it allowed the assessee to raise the plea of validity of reassessment proceedings based on the notice under section 148 being without jurisdiction. The answer to the question being self-evident, no statable question of law arose from the order of the Tribunal. Note : The case was decided in favour of the assessee. JUDGMENT R.K. Gulati, J. - This is an application under section 256(2) of the Income-tax Act, 1961, filed at the instance of the Revenue. Two questions have been proposed in this application. The controversy raised revolves around the question whether the Income-tax Appellate…

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