Referability of Question of Law: administrative board must refer debatable legal questions to higher court; refusal here unjustified.

Whether the Board of Revenue may refuse to state a case under the Act was decided by applying the statutory scheme and analogy with income tax statement of case provisions; the Board's function is to determine if a question of law arises, and where it does the Board must ordinarily draw and refer a statement of the case unless the Supreme Court has authoritatively settled the point. The Board cannot decline referral merely because it views the law as clear or favourably decided; refusal here was unjustified and the Board was directed to state and refer the question on whether out of State despatches constitute sales and inclusion in taxable turnover.

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Issues: Whether the Board of Revenue's refusal to state a case and refer questions of law arising under section 22(5) of the Central Provinces and Berar Sales Tax Act, 1947 to the High Court under section 23(1)/(2)(b) was justified.

Analysis: The question whether a question of law arises from the Board's order and whether the Board may refuse to refer such a question were examined with reference to the statutory scheme of sections 22(5) and 23(1)-(3) of the Central Provinces and Berar Sales Tax Act, 1947 and by analogies drawn from provisions of the Income-tax Act concerning statement of case. The Board's role is to determine whether a question of law arises; where such a question does arise the Board must ordinarily draw up a statement of the case and refer it to the High Court unless the law is settled by a decision of the Supreme Court. Refusal to make a reference on the ground that the question is not debatable or is settled by decisions of this High Court or other authorities was considered; authorities establishing that the correctness of the Board's decision is irrelevant to whether a question of law arises were applied. It was held that the Board cannot decline to refer merely because it believes the law is clear or that the point is answered by existing decisions of this Court; the power to refuse is limited and where a question of law does arise the Board must state and refer the case except in the narrow circumstance of binding Supreme Court authority settling the point.

Conclusion: The Board of Revenue's refusal to state the case and refer the question of law was not justified; the application under section 23(2)(b) is allowed and the Board is directed to state the case and refer the question whether the despatches outside the State amount to 'sales' within the meaning of the Act and whether the specified amount can be included in taxable turnover.

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