Binding precedent made reference questions academic, leaving the assessee's charitable status and exemption treatment undisturbed.

An earlier binding decision had already established the assessee's charitable status, so the assessment was required to proceed under the exemption framework applicable to charitable institutions. On that basis, the questions referred on the taxability of sale proceeds from forms, miscellaneous receipts, interest income, amounts under the welfare fund ordinance, and related expenses had become academic and did not require adjudication in reference jurisdiction. The HC therefore declined to answer the references and sent them back to the Tribunal for final orders in light of the earlier decision.

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Issues: Whether the references under section 256(2) of the Income-tax Act, 1961, should be answered on the merits when the controversy had already been concluded by an earlier decision holding the assessee to be a charitable institution and the questions had become academic.

Analysis: The assessee's charitable character had already been settled by an earlier binding decision, with the consequence that the assessment had to proceed under sections 11 to 13 of the Income-tax Act, 1961. In that situation, the referred questions relating to taxability of income from sale of forms, miscellaneous receipts, interest income, exempt status of amounts under the welfare fund ordinance, and allowance of expenses no longer required adjudication in the reference jurisdiction.

Outcome: The references were declined to be answered and were returned to the Tribunal unanswered, with directions to pass final orders under section 260 of the Income-tax Act, 1961, in the light of the earlier decision.

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