Ajit K. Sengupta, J. - (1.) At the instance of the Commissioner, West Bengal IX, the following questions of law have been referred to this court under Section 256(1) of the Income-tax Act, 1961 ("the Act"), for the assessment year 1964-65 : "(1) Whether, on the facts and in the circumstances of the case, the Tribunal is correct in interpreting the additional ground raised by the assessee at the hearing of the appeal as meaning that the charging of interest under Section 139(1) of the Income-tax Act, 1961, in the assessment is not valid for the reason that the Income-tax Act does not provide for the charging of interest under Section 139(1) in a case where the assessee had not applied for extension of time for the filing of the return. (2) Whether, on the facts and in the circumstances of the case, the Tribunal had no jurisdiction to direct the Appellate Assistant Commissioner to decide a ground regarding the charging of interest under Section 139(1) of the Income-tax Act, 1961, a ground that was not raised by the assessee in the appeal before the Appellate Assistant Commissioner. (3) Whether the Tribunal is correct in holding that the Income-tax Act, 1961, contains provisions for an appeal before the Appellate Assistant Commissioner against the levy of interest under Section 139 of the said Act and in directing the Appellate Assistant Commissioner to adjudicate upon the issue regarding the correctness of the levy of interest under the said Section 139(1)."
(2.) The facts relating to this reference are shortly stated as hereunder : For the assessment year 1964-65, a notice under Section 139(2) of the Act was served upon the assessee-firm on June 9, 1964, and its return was due by July 9, 1964. The notice was, however, not complied with, nor did the assessee ask for extension of time for filing the return. The return was eventually filed on December 31, 1966. While completing the assessment, the Income-tax Officer charged interest under Section 139. The assessee-firm preferred an appeal before the Appellate Assistant Commissioner challenging various additions and disallowances made by the Income-tax Officer in computing the income, but no ground was raised before the Appellate Assistant Commissioner disputing the charging of interest under Section 139. The Appellate Assistant Commissioner had, therefore, no occasion to deal with the issue regarding charging of interest under Section 139.
(3.) Against the order of the Appellate Assistant Commissioner, the asses-see-firm preferred appeal and the Department also preferred appeal. In the grounds of appeal originally filed before the Tribunal, the assessee did not raise any ground disputing the charging of interest under Section 139 but, at the hearing of the appeal on July 12, 1976, the assessee filed an additional ground which read as follows : "The charge of interest under Section 139 has been ultra vires the Income-tax Act and is liable to be struck off.";