Requirement to State Points of Difference is jurisdictional; failure renders a reference invalid and prevents adopting a third quantum.

Section 5A(7) reference procedure requires the original Bench to state specific point(s) of difference as a jurisdictional prerequisite; absent such stated points, the President (or a third member) lacks competence to decide unspecified issues, rendering any reference invalid. Where the two original members record conflicting quanta, the statutory scheme mandates that the President/third member adopt the view of one original member so as to produce a majority; substituting a third, different quantum is impermissible. Consequence: the reference and the President's opinion are legally invalid and the matter must be remitted to the Tribunal for disposal according to law.

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Issues: (i) Whether the President of the Income-tax Appellate Tribunal acted in accordance with law in deciding the reference made under Section 5A(7) of the Income-tax Act where the two original members failed to state the point(s) of difference; (ii) Whether the assessment can be legally completed in accordance with the direction contained in the President's order.

Issue (i): Whether the President's order is in accordance with law given that the two members of the Tribunal did not state the point or points on which they differed before referring the case under Section 5A(7) of the Income-tax Act.

Analysis: Section 5A(7) mandates that where members of a Bench are equally divided they shall state the point or points on which they differ and then the case may be referred to the President for hearing on such specified point(s). This statutory precondition is a jurisdictional requirement. If the original members fail to formulate the point(s) of difference, the special jurisdiction prescribed by Section 5A(7) does not arise and the President or other members lack competence to hear the reference on unspecified issues.

Conclusion: The President's order is not in accordance with law because the two members who first heard the appeal failed to state the point or points on which they differed, a condition precedent to validly invoking Section 5A(7).

Issue (ii): Whether the assessment may be legally completed in accordance with the President's direction substituting a new figure when the President adopted a different quantum from both original members.

Analysis: Section 5A(7) requires that the point referred be decided according to the opinion of the majority of members who have heard the case, including those who first heard it. Where the original two members have taken contrary views as to quantum, the statutory machinery contemplates the President or third member agreeing with the view of one or the other original members; it does not permit the President to adopt a third, different quantum, because that would produce no majority for any single assessed figure and render the section's majority rule unworkable.

Conclusion: The assessment cannot be legally completed in accordance with the President's direction which adopts a different quantum from both original members; the President was bound to adopt the quantum of either the Accountant Member or the Judicial Member, not a third figure.

Final Conclusion: The reference under Section 5A(7) to the President of the Tribunal was incompetent and the President's opinion is legally invalid; the matter must be sent back to the Income-tax Appellate Tribunal to be dealt with and disposed of in accordance with law.

Ratio Decidendi: A valid reference under Section 5A(7) of the Income-tax Act requires the original members to state the specific point(s) of difference as a jurisdictional condition, and when referred the President or third member must decide in favour of the quantum adopted by one of the original members rather than substitute a new differing quantum.

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