Law: Income Tax Act, 1961

Section: 254

Income-tax----Appeal to Appellate Tribunal---Powers of Tribunal---Power to allow additional grounds of appeal---Indian Income Tax Act, 1961, S.254. Section 254 of the Indian Income Tax Act, 1961, empowers the Tribunal to pass an order after giving both the parties to the appeal an opportunity of being heard as it thinks fit. The Tribunal has ample power to allow additional grounds of appeal. For the assessment year 1982-83, the assessee-company did not make any claim for deduction under section 35(1)(ii)/35(2-A) of the Income Tax Act 1961, and, therefore, the Assessing Officer did not pass any order on this point. The assessee wanted to raise this ground as an additional ground before the Commissioner of Income-tax (Appeals). However, the Commissioner of Income-tax (Appeals) rejected the appeal along with other grounds. The assessee preferred an appeal before the Income-tax Appellate Tribunal. The Tribunal, after hearing the parties, allowed the appeal and directed the Commissioner of Income-tax (Appeals) to entertain the additional ground raised by the assessee. On a reference: Held, that the Tribunal was justified in directing the Commissioner of Income-tax (Appeals) to admit the assessees ground relating" to deduction under section 35(1)(ii)/35(2-A) taken before him and dispose of the matter on the merits though the same was not raised before the Assessing Officer. JUDGMENT D.N. BARUAH, J.---The following question has been referred under section 256(2) of the Income Tax Act, 1961 (for short " the Act"), as per the direction of this Court in Civil Rule No.2(M) of 1994 for the opinion of this Court: "Whether, under the facts and circumstances of the case, the Tribunal was justified in directing the Commissioner of Income-tax (Appeals) to admit the assessees ground relating to weighted deduction under section 35(1)(ii)/35(2-A) taken before him and dispose of the matter on merits when the same was not raised before the Assessing Officer?" The facts for the purpose of answering this question are; In connection with the assessment year 1982-83, the assessee company did not make any claim for deduction under section 35(1)(ii) 35(2-A) of the Act. Therefore, the…

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