In this paper we report the first identification of a Jahn-Teller (J-T) splitting (≈ 160 cm −1) arising via quadratic vibronic coupling in a mode which is non-active in the linear J-T coupling. This splitting has been detected in the hot-band structure of the out-of-plane mode v 20(e 2u) in the Rydberg spectrum of benzene converging to the first ionization limit. This observation enables us to resolve the long-standing controversy with respect to the assignment of the relevant Rydberg spectrum.