Issues Involved: 1. Jurisdiction of the Income-tax Appellate Tribunal to permit new grounds not raised before the Appellate Assistant Commissioner (AAC). 2. Interpretation of relevant Supreme Court decisions regarding the Tribunal's powers. 3. The scope and subject matter of appeals before the Tribunal.
Summary:
Jurisdiction of the Tribunal: The primary issue concerns whether the Income-tax Appellate Tribunal has the jurisdiction to allow the assessee to raise new grounds for the first time before it, which were not raised before the AAC. The court examined earlier pronouncements and differing views from various High Courts and Supreme Court decisions on this matter.
Interpretation of Supreme Court Decisions: The court referred to key Supreme Court decisions such as Hukumchand Mills Ltd. v. CIT [1967] 63 ITR 232, CIT v. Mahalakshmi Textile Mills Ltd. [1967] 66 ITR 710, and CIT v. Nelliappan [1967] 66 ITR 722. These cases established that the Tribunal has the authority to entertain new grounds if they relate to the subject matter of the appeal, even if these grounds were not raised before the AAC. The Tribunal's power is broad but must be exercised within the jurisdiction of the subject matter of the appeal.
Scope and Subject Matter of Appeals: The court emphasized that the subject matter of the appeal determines the jurisdiction of the Tribunal. If the new grounds pertain to the same subject matter as the original appeal, the Tribunal can permit these grounds to be raised. The subject matter includes the entire range of questions that could have been raised at the stage of assessment, and the Tribunal can allow a new approach or perspective to the same issue.
Application to the Case: In the present case, the assessee, a public limited company, sought relief u/s 80J of the I.T. Act for the assessment years 1968-69 and 1969-70. The Tribunal allowed the assessee to raise an additional ground concerning the computation of capital, which was not raised before the AAC. The court held that this additional ground was related to the same subject matter and thus within the Tribunal's jurisdiction.
Conclusion: The court concluded that the Tribunal was within its jurisdiction to allow the assessee to raise the additional ground for the first time before it, as it related to the same subject matter of the appeal. The question was answered in the affirmative, in favor of the assessee and against the Revenue.
Order: A copy of this judgment shall be sent under the seal of this court and the signature of the Registrar to the Income-tax Appellate Tribunal.
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