Referable question of law on assessment of jewellery value between husband and wife recognised for reference.

Questions challenging the factual findings on ownership of jewellery and acceptance of the assessee's explanation were treated as pure questions of fact and were not directed to be referred. The remaining issue, whether the value of jewellery recovered from a room in the wife's possession should be assessed in the assessee's hands or in the wife's hands, was considered a referable question of law under section 256(2) of the Income-tax Act, 1961. The reference was therefore allowed in part, and the question was directed to be stated in a reframed form.

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Issues: Whether the question relating to inclusion of the value of jewellery in the assessee's assessment, and not in his wife's assessment, was a referable question of law under section 256(2) of the Income-tax Act, 1961.

Analysis: The questions challenging the factual findings on ownership of the jewellery and the acceptance of the explanation were treated as arising from a pure finding of fact and were therefore not directed to be referred. The remaining question, whether the jewellery value should be assessed in the assessee's hands or in his wife's hands when recovered from a room in the wife's possession, was considered to raise a question of law suitable for reference.

Conclusion: The referred question was allowed in part, and question No. 4 was directed to be stated under section 256(2) in the reframed form.

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