2014 (12) TMI 60

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.... The Tribunal refused to admit this question as in its opinion, it does not arise out of the order of the First Appellate Authority. 2. After hearing Mr. Irani, learned counsel, appearing on behalf of the Assessee, in support of this Appeal and Mr. Chhotaray, learned counsel, appearing for the Revenue, we are of the opinion that the Appeal deserves to be admitted. It is admitted on the following substantial question of law:- "Whether on the facts and the circumstances of the case and in law, the ITAT was right in rejecting the Additional Grounds of Appeal raised by the Appellant?" 3. Since the Tribunal has not allowed the Assessee to raise this additional ground, no useful purpose will be served by keeping this Appeal pending on ou....

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....Hon'ble Supreme Court held as under:- "Under section 254 of the Income Tax Act, the Appellate Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit. The power of the Tribunal in dealing with Appeals is thus expressed in the widest possible terms. The The purpose of the assessment proceedings before the taxing authorities is to assess correctly the tax liability of an Assessee in accordance with law. If, for example, as a result of a judicial decision given while the Appeal is pending before the Tribunal, it is found that a nontaxable item is taxed or a permissible deduction is denied, we do not see any reason why the Assessee should be prevented from raising....

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....ts own facts. The Appellate Assistant Commissioner must be satisfied that the ground raised was bona fide and that the same could not have been raised earlier for good reasons. The Appellate Assistant Commissioner should exercise his discretion in permitting or not permitting the Assessee to raise an additional ground in accordance with law and reason. The same observations would apply to Appeals before the Tribunal also. The view that the Tribunal is confined only to issues arising out of the Appeal before the Commissioner of Income Tax (Appeals) takes too narrow a view of the powers of the Appellate Tribunal [vide, e.g. CIT V/s. Anand Prasad (1981) 74 ITR 254 (Guj) and CIT V/s. Cellulose Products of India Ltd. (1985) 151 ITR 499 (Guj) ....