Reference under section 256(2) limited to surviving questions of law; issues covered by binding precedent were excluded.

In a section 256(2) Income-tax Act application, the HC directed reference only of questions that were real questions of law arising from the Tribunal's order. Questions already covered by binding precedent, including one decided by the same HC and another by the Supreme Court, were excluded from reference. The remaining questions were treated as referable legal issues, and the Tribunal was required to draw up a statement of the case and refer only those surviving questions for the High Court's opinion. The application therefore succeeded only in part.

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Issues: Whether the application under section 256(2) of the Income-tax Act, 1961 should be partly allowed by directing the Tribunal to refer only those questions which arose as questions of law, while excluding questions already covered by prior binding decisions.

Analysis: The Court held that one question was covered by an earlier decision of the same court and another was covered by the decision of the Supreme Court. It further held that the remaining questions were questions of law and did arise out of the Tribunal's order, making them fit for reference under section 256(2).

Conclusion: The Tribunal was directed to draw up a statement of the case and refer the questions of law identified as arising out of its order, while the application was rejected to the extent it sought reference of questions already covered by binding precedent.

Final Conclusion: The reference application succeeded only in part, and the Tribunal was required to refer only the surviving questions of law for opinion of the High Court.

Ratio Decidendi: In an application under section 256(2), the Court will direct a reference only of questions that are real questions of law arising from the Tribunal's order and not already concluded by binding precedent.

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