Jurisdictional challenge to reassessment can be raised first time in appeal when statutory preconditions are absent.

A jurisdictional objection to the initiation of reassessment under section 147(a) can be raised for the first time before the Appellate Assistant Commissioner, because the formation of belief that income has escaped assessment is a condition precedent to valid jurisdiction. Failure to object earlier does not waive a defect that goes to the root of the reassessment power. The first appellate authority's powers are coterminous with those of the Income-tax Officer, so it may entertain such a challenge even in a second round after remand. The Tribunal was therefore wrong to hold that the objection was barred.

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Issues: Whether the assessee could raise for the first time before the Appellate Assistant Commissioner a challenge to the validity of the initiation of reassessment proceedings under section 147(a) in the second round of proceedings after remand.

Analysis: The formation of belief that income has escaped assessment is a condition precedent to the assumption of jurisdiction for reassessment, and a defect in that foundational requirement goes to the very root of the matter. A jurisdictional objection of this nature is not cured by the assessee's failure to raise it at earlier stages. The first appellate authority's powers are coterminous with those of the Income-tax Officer, and such a jurisdictional ground can be entertained even if it was not urged before the Income-tax Officer. The fact that the matter arose in a second round after remand did not deprive the assessee of the right to question the very jurisdiction to reopen the assessment.

Conclusion: The objection to the initiation of reassessment proceedings was rightly entertainable before the Appellate Assistant Commissioner, and the Tribunal was wrong in holding otherwise.

Final Conclusion: A jurisdictional challenge to reassessment could be raised for the first time in the appellate proceedings, and the reference was answered in favour of the assessee.

Ratio Decidendi: A challenge going to the very jurisdiction to initiate reassessment, where the statutory conditions precedent are in issue, may be raised for the first time before the first appellate authority and is not barred by omission to raise it earlier.

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