High Court reference jurisdiction cannot compel fresh evidence; supplemental statements are limited to material already on record.

In an income-tax reference, the High Court's jurisdiction is advisory and confined to answering questions of law arising from the Tribunal's order on the existing record. It may call for a supplemental statement of the case only to clarify or properly place facts already recorded, but it cannot enlarge the reference or direct the Tribunal to take fresh evidence. The Supreme Court held that the High Court had no jurisdiction to require additional evidence while seeking a supplemental statement, and the matter was remitted for disposal of the reference in accordance with law on the existing record.

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Issues: Whether the High Court, in a reference under the Income-tax Act, could direct the Tribunal to submit a supplemental statement of the case by taking additional evidence.

Analysis: The jurisdiction of the High Court on a tax reference is advisory and is confined to answering questions of law arising out of the Tribunal's order. While the High Court may call for a supplemental statement so that the existing record is properly placed before it, that power is limited to facts already on the record. It cannot enlarge the reference by directing the Tribunal to take fresh evidence, because the question referred must remain one arising from the Tribunal's own order and must be answered on the material already before the Tribunal.

Conclusion: The High Court had no jurisdiction to direct the Tribunal to take additional evidence while calling for a supplemental statement of the case. The objection succeeded in favour of the assessee.

Final Conclusion: The appeals succeeded on the jurisdictional point, the impugned order was set aside, and the matter was remitted to the High Court for disposal of the reference in accordance with law on the existing record.

Ratio Decidendi: In a reference under the Income-tax Act, the High Court may require a supplemental statement only to amplify facts already on record, but it cannot direct the taking of fresh evidence, since its jurisdiction is purely advisory and confined to questions of law arising from the Tribunal's order.

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