Reference under section 256(2) requires a genuine question of law; factual findings and reopened evidence are not referable.

A reference under section 256(2) of the Income-tax Act lies only where a genuine question of law arises. Questions based on appreciation of evidence and concurrent factual findings on unexplained investment in ornaments, house construction, and unexplained credit were not referable, because they sought only reappreciation of facts. The issue relating to an addition remanded for fresh examination also did not raise a question of law, since remand leaves the matter open before the Assessing Officer. A question on alleged undeclared payment for immovable property failed because it rested on inference, not incriminating search material, and the credit issue fell outside undisclosed income under Chapter XIV-B as it appeared in the regular books.

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Issues: Whether the questions sought to be referred under section 256(2) of the Income-tax Act, 1961 gave rise to any referable question of law.

Analysis: The challenge related principally to additions concerning alleged unexplained investment in gold and silver ornaments, construction of a house, undeclared payments for immovable property, and unexplained credit. The questions relating to the first four additions turned on appreciation of evidence and concurrent factual findings recorded by the Tribunal, and did not disclose any failure to consider material on record. A reference cannot be sought merely to reopen or reappreciate findings of fact. The question relating to the addition set aside for fresh examination also did not raise a question of law because remand for reconsideration leaves the matter open before the Assessing Officer. The addition concerning undeclared payment for immovable property was based on inferences and not on incriminating material or information from search proceedings, while the question concerning unexplained credit failed because the credit was shown in the regular books of account and fell outside the scope of undisclosed income under Chapter XIV-B after section 158BA.

Conclusion: No referable question of law arose from the questions proposed by the Revenue.

Final Conclusion: The reference application failed because the controversy was factual or already settled and did not warrant a reference to the High Court.

Ratio Decidendi: A reference under section 256(2) lies only where a genuine question of law arises; issues resting on factual findings, reappreciation of evidence, or matters outside the statutory scope of undisclosed income are not referable.

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