Additional grounds in appeal may be heard on merits when raised and argued with notice to the other side.

An appellate forum should not reject a ground on a technicality where the point was mentioned in the memorandum, clarified at the final hearing, and actually argued with an opportunity for the other side to respond. Once the tribunal permits argument on the point, it should treat the issue as an additional ground and decide it on merits rather than refuse consideration for want of precise drafting or a formal request under Rule 11. The matter was therefore remitted for fresh decision on the disputed addition after amendment of the appeal memo and a reasonable opportunity to the assessee.

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Issues: Whether the Tribunal can refuse to adjudicate on merits an issue that was vaguely raised in the memorandum of appeal but was specifically argued at the final hearing, on the ground that no specific ground had been taken and no leave under Rule 11 was sought.

Analysis: The issue was not wholly absent from the appeal and was debated before the Tribunal. Once the Tribunal permitted the parties to address the point, it was not open to it to decline consideration merely because the ground had not been stated with precision in the memorandum. A vague ground, later clarified and pressed at the hearing, could be permitted to be raised as an additional ground, especially when the Revenue had an opportunity to meet the submission. The refusal to examine the addition on merits was therefore not justified.

Conclusion: The assessee was entitled to have the issue concerning the addition of Rs. 8,94,039 adjudicated on merits, and the Tribunal's refusal to do so was set aside.

Final Conclusion: The matter was remitted to the Tribunal for decision afresh on the disputed addition after permitting amendment of the appeal memo and granting reasonable opportunity to the assessee.

Ratio Decidendi: Where an issue is sufficiently raised in the appeal and is actually argued with notice to the opposite party, the appellate forum should permit it as an additional ground and decide it on merits rather than reject it on a technicality.

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