Judgement

GROVER, J.:- This is an appeal by certificate from a judgment of the Special Bench of the Madras High Court in which the sole question that has to be determined is whether Rule 24 of the Appellate Tribunal Rules, 1946, insofar as it enables the Tribunal to dismiss an appeal for default of appearance was ultra vires the provisions of Section 33 of the Income-tax Act, 1922, hereinafter called the "Act".

2. The facts which gave rise to the reference which was made to the High Court by the Appellate Tribunal lie within a narrow compass. The assessee owned 1674 shares in Asher Textiles Ltd. and 9 out of 20 shares in Textile Corporation (Private) Ltd., at Tiruppur. The latter company was the managing agent of the Asher Textiles Ltd. The assessee was a Joint Managing Director of the Textile Corporation (Private) Ltd. along with one P. D. Asher. The assessee sold on December 21, 1954 his entire holding in two companies to Asher and some of his relations. These sales resulted in a profit of Rs. 72,515/- and Rs. 3,14,100/- respectively. The Income-tax Officer assessed these amounts, to tax for the assessment year 1956-57 under Section 10 (5A) of the Act as compensation earned for par