1986 (7) TMI 30 - HC - Income Tax

Court Upholds Tribunal's Discretion on Grounds

The Court upheld the Tribunal's decision to refuse the Revenue permission to raise an additional ground under section 147(b) of the Income-tax Act. The ... Appeal To Tribunal Issues:- Refusal of permission to raise additional ground under section 147(b) by the Tribunal.Analysis:The case involved the question of whether the Tribunal was justified in refusing permission to the Revenue to raise the additional ground of the applicability of section 147(b) of the Income-tax Act. The assessee, a partnership firm, had its assessments reopened under section 147(a) due to interconnected transactions with another firm. The Appellate Assistant Commissioner held that the reassessments were invalid under section 147(a) as there was no omission to disclose material facts. The Revenue appealed to the Tribunal, seeking to raise the contention under section 147(b, but the Tribunal refused permission.The Court emphasized that the issue was not about the applicability of section 147(b) but the discretion exercised by the Tribunal in refusing the Revenue to raise an additional ground under section 147(b) to sustain the reassessments. Citing the case of Manji Dana v. CIT, the Court noted that the exercise of discretion by the Tribunal to allow or disallow a question not set forth in the memorandum of appeal is not generally a question of law. The Tribunal provided cogent reasons for its decision, considering that the Income-tax Officer had clearly stated that the assessments were reopened only under section 147(a, and all arguments proceeded on that basis. Therefore, the Tribunal's refusal to permit the Revenue to raise the additional ground was deemed justified and not arbitrary.In conclusion, the Court answered the question in the affirmative and against the Revenue, upholding the Tribunal's decision to refuse permission to raise the additional ground under section 147(b).