Reference on bonus liability accrual allowed, while sticky account and interest questions were barred by binding precedent.

Questions on real income from sticky accounts, change from mercantile to cash system for such accounts, and charging interest on accounts closed for more than three years were treated as already concluded by binding Supreme Court precedent, so no referable question survived on those points and they were rejected. The question on accrual of bonus liability was held to arise from the Tribunal's order and therefore satisfied the reference requirement under section 256(2) of the Income-tax Act, 1961; it was directed to be stated and referred.

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Issues: (i) Whether questions relating to the treatment of bonus liability and interest on sticky accounts could be referred under section 256(2) of the Income-tax Act, 1961 in view of binding precedent. (ii) Whether the question relating to accrual of bonus liability arose from the Tribunal's order and was referable.

Issue (i): Whether questions relating to the treatment of bonus liability and interest on sticky accounts could be referred under section 256(2) of the Income-tax Act, 1961 in view of binding precedent.

Analysis: The questions concerning real income on sticky accounts, change from mercantile to cash system on such accounts, and charging of interest on accounts closed for more than three years were treated as concluded against the assessee by the Supreme Court decision governing the subject. In that situation, no referable question survived on those points.

Conclusion: These questions were not referable and were rejected.

Issue (ii): Whether the question relating to accrual of bonus liability arose from the Tribunal's order and was referable.

Analysis: The court found that the issue concerning the accrual of liability for bonus did arise from the Tribunal's order and therefore satisfied the requirement for a reference under section 256(2) of the Income-tax Act, 1961.

Conclusion: This question was directed to be stated by the Tribunal and referred.

Final Conclusion: The application succeeded only to the extent of one question, while the remaining questions were declined as already settled against the assessee.

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