Reference of questions of law turns on whether the issue arises from the Tribunal's order and was conclusively decided.

A proposed question of law will be referred only if it truly arises from the Tribunal's order and has been conclusively determined there. The first question, concerning the taxability of scrap sale proceeds, was not shown to arise from the order and was not referred. The second question, concerning whether scrap sale proceeds must be deducted from the actual cost of the block of assets while computing written down value and depreciation under sections 43(1), 43(6) and 43(6)(c) of the Income-tax Act, was not conclusively decided by the Tribunal and was therefore directed to be referred.

---

---

Issues: (i) Whether the first proposed question of law arose from the Tribunal's order; (ii) whether the second proposed question of law, relating to deduction of scrap sale proceeds from the actual cost of the block of assets for computing written down value and depreciation, required reference.

Issue (i): Whether the first proposed question of law arose from the Tribunal's order.

Analysis: The proposed question concerned the taxability of sale proceeds of scrap. The Court found that this question was not shown to arise from the Tribunal's order.

Conclusion: The first question of law did not arise and was not directed to be referred.

Issue (ii): Whether the second proposed question of law, relating to deduction of scrap sale proceeds from the actual cost of the block of assets for computing written down value and depreciation, required reference.

Analysis: The proposed question involved the effect of sections 43(1), 43(6) and 43(6)(c) of the Income-tax Act, 1961 on the computation of actual cost and written down value. The Tribunal had noted the arguments, but had not conclusively decided the issue; therefore, the question warranted reference.

Conclusion: The second question of law was directed to be referred.

Final Conclusion: The reference application succeeded only in part, with one proposed question declined and the other sent for reference, and the matter was disposed of accordingly.

Ratio Decidendi: A question will be referred only if it truly arises from the Tribunal's order and has been conclusively decided or determined therein.

---