Reference under section 256(2) refused on tenancy rights, transfer, and capital gains questions after prior rejection on similar facts

On materially similar facts to an earlier rejected reference application, the Bombay HC declined to direct the Tribunal under section 256(2) to state a case on whether tenancy rights were a capital asset, surrender of those rights amounted to a transfer, and capital gains arose under section 45. The court treated the prior rejection, including the failed attempt to obtain special leave, as a sufficient basis to refuse a further reference. The application was not entertained and was dismissed.

---

---

Issues: Whether the Tribunal could be directed under section 256(2) of the Income-tax Act, 1961 to refer the questions relating to whether the assessee's tenancy rights constituted a capital asset, whether surrender of those rights amounted to a transfer, and whether capital gains arose under section 45.

Analysis: The facts were found to be materially similar to an earlier case in which a comparable reference application had already been rejected, and even the attempt to obtain special leave against that rejection had failed. On that footing, no reason was seen to direct the Tribunal to state a case and refer the questions for determination.

Conclusion: The application for reference was not entertained and was dismissed.

---