Validity of reassessment under section 147 was held to raise a referable question of law on the facts found

The validity of reassessment proceedings under section 147 of the Income-tax Act depended on whether a common question of law arose from the Tribunal's refusal to reopen the assessments. Because the appellate authority had found that the additional floors were incomplete and not ready for occupation up to the relevant assessment year, and no other material supported reopening, the matter was treated as raising a referable legal question rather than a purely factual dispute. The Tribunal was therefore directed to refer the question of law to the High Court.

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Issues: Whether the Tribunal was required to refer to the High Court the common question of law relating to the validity of proceedings reopened under section 147 of the Income-tax Act, 1961.

Analysis: The controversy turned on whether, on the facts found by the appellate authority that the additional floors were not complete and were not ready for occupation up to the relevant assessment year, a question of law arose from the refusal to reopen the assessments. The absence of any other material supporting reopening was treated as sufficient to show that the matter was not merely factual and that the legal validity of the reassessment proceedings was capable of reference.

Conclusion: The common question of law did arise and the Tribunal was directed to refer it to the High Court.

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