Ramachandra Iyer, C.J.—

This Reference to a Special Bench has been necessitated by reason of certain doubts felt as to the correctness of the decision in Ravula Subba Rao v. Commissioner of Income-tax1. The question that falls for determination on this Reference can be formulated thus: —

“Whether rule 24 of the Appellate Tribunal Rules, 1946 in so far as it enables the Tribunal to dismiss an appeal for default of appearance, is ultra vires ?”

The facts giving rise to this Reference are these: The assessee owned 1,674 shares in Asher Textiles, Limited and nine out of twenty shares, in Textile Corporation (Private), Limited, both at Tiruppur. The Textile Corporation (Private), Limited was the Managing Agent of the other company, its Managing Directors being the assessee and one Mr. Asher. Differences appear to have arisen between these two some time during the year 1954 and the assessee agreed to sell and by a document dated 21st December, 1954, sold his entire holding in the two companies to Mr. Asher and certain relations of his nominated by him. These sales resulted in a profit of Rs. 72,515 and Rs. 3,14,100 respectively. The Income-tax Officer brought them to tax for the assessment

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