Reference under section 256 requires questions to arise from the Tribunal's order; merged issues are not separately referable.

For reference under section 256, only questions that genuinely arise from the Tribunal's order are referable to the High Court. The questions challenging rejection of the assessee's book results and the Tribunal's estimation of income were treated as part of the same controversy and held referable, so the Tribunal was directed to state the case on those points. Questions treated as a further aspect of that controversy were not separately referable, and a challenge directed at the Commissioner (Appeals) was held barred because that order had merged in the Tribunal's decision. The petition therefore succeeded only in part.

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Issues: (i) Whether questions Nos. 1 and 3 framed in the petition arose out of the Tribunal's order and were referable to the High Court; (ii) Whether questions Nos. 2 and 4 were referable questions of law.

Issue (i): Whether questions Nos. 1 and 3 framed in the petition arose out of the Tribunal's order and were referable to the High Court.

Analysis: The questions challenging the rejection of the assessee's book results and the Tribunal's estimation of income were found to arise from the appellate order. The objection that the estimate of income was unsupported was treated as part of the same controversy and not as a separate, independent issue.

Conclusion: Questions Nos. 1 and 3 were held to be referable and the Tribunal was directed to state the case on those questions.

Issue (ii): Whether questions Nos. 2 and 4 were referable questions of law.

Analysis: Question No. 2 was treated as merely another aspect of the same controversy covered by questions Nos. 1 and 3. Question No. 4 was held to be an attack on the order of the Commissioner (Appeals), which had merged in the Tribunal's order and therefore could not be separately referred.

Conclusion: Questions Nos. 2 and 4 were held not to be referable questions of law.

Final Conclusion: The petition succeeded only in part, with a direction to refer the identified questions to the High Court while declining reference of the remaining questions.

Ratio Decidendi: For reference under section 256, only questions that genuinely arise from the Tribunal's order are referable, and an issue merged in the Tribunal's decision cannot be separately referred.

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