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Issues:
1. Validity of the dismissal of an appeal as infructuous without fixing a date for hearing. 2. Interpretation of Section 31 of the Indian Income-tax Act, 1922 regarding the procedure for hearing and disposal of appeals. Detailed Analysis: The judgment pertains to a case where an Income-tax Officer passed an assessment order under section 23(4) of the Income-tax Act due to the assessee's non-compliance with a notice. Subsequently, the assessee filed an application under section 27 for cancellation of the ex parte assessment order. The Income-tax Officer accepted the application, set aside the assessment order, and reopened the assessment proceedings. The Appellate Assistant Commissioner was informed of the cancellation, and the Commissioner dismissed the appeal as infructuous without setting a date for the hearing, leading to the assessee filing an appeal before the Tribunal. The Tribunal held that under section 31 of the Income-tax Act, the Commissioner should have fixed a date and place for the hearing of the appeal before disposing of it. The Tribunal also noted that the assessee had raised additional grounds challenging the assessment order beyond those in the section 27 application. The Tribunal allowed the appeal, sending the matter back to the Commissioner for reconsideration. The Tribunal referred a question of law to the High Court regarding the Appellate Assistant Commissioner's authority to dismiss the appeal as infructuous without fixing a date for the hearing. The High Court interpreted Section 31 and concluded that the provision applies to the hearing and disposal of appeals on merits, allowing for additional grounds to be considered. However, in cases where an assessment order has been completely cancelled, rendering the appeal incapable of being decided on merits, the procedural requirements of Section 31 may not apply. The High Court held that the Appellate Assistant Commissioner was justified in not fixing a date for the appeal's hearing when it had become infructuous due to the cancellation of the assessment order. The Court disagreed with the Tribunal's view that a date and place for hearing must be set even in such situations, as it would cause unnecessary hardship to the assessee without serving any useful purpose. Therefore, the High Court answered the referred question in the negative, favoring the department and against the assessee, with no order as to costs.
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