Reference on character of property raised a genuine question of law and was directed to be stated to the High Court.

A reference under section 27(3) of the Wealth-tax Act was held to be properly sought where the Tribunal's order raised a genuine question of law on whether disputed assets formed part of the deceased's individual property or the Hindu undivided family property. The Court noted that the same controversy had already featured in connected estate duty proceedings, and that the proposed question arose directly from the Tribunal's reasoning. The reference was therefore directed to be made for the High Court's opinion, with the Revenue succeeding on the reference application.

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Issues: Whether the common question proposed by the Revenue arose out of the Tribunal's order and was a question of law fit to be referred to the High Court.

Analysis: The applications under section 27(3) of the Wealth-tax Act, 1957 concerned the assessment years 1957-58 to 1961-62. The Tribunal had relied on its earlier decision in the connected estate duty matter, and the same controversy regarding whether the assets formed part of the deceased's individual property or belonged to the Hindu undivided family was already the subject of reference proceedings. On that basis, the Court found that the proposed question did arise from the Tribunal's order and involved a question of law.

Conclusion: The question was rightly directed to be referred for the opinion of the High Court, in favour of the Revenue.

Final Conclusion: The reference application succeeded and the Tribunal was directed to state the case and refer the formulated question of law.

Ratio Decidendi: Where the Tribunal's order gives rise to a genuine question of law concerning the character of property, the High Court may direct a reference under the applicable reference provision.

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