Income-tax reference limits prevent courts from deciding unframed questions; incorrect framing led to remand for proper determination.

In an income-tax reference, the High Court is confined to the question actually referred under section 66(1) of the Indian Income-tax Act, 1922, and cannot decide an unframed issue. Here, the reference asked whether income accrued or arose in British India, while the real controversy was whether it accrued or arose in the State of Mysore so as to qualify for exemption under section 14(2)(c). Because the High Court answered a different question from the one referred, the proper course was to set aside its judgment and remit properly framed questions for decision. No final determination of the assessee's tax liability was made.

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Issues: Whether the High Court could decide a question not actually referred to it under the income-tax reference procedure, and whether the appeal should be allowed by setting aside the High Court's judgment and remitting proper questions for decision.

Analysis: The question referred under section 66(1) of the Indian Income-tax Act, 1922 was confined to whether the income accrued or arose in British India, but the real controversy was whether the income accrued or arose in the State of Mysore so as to attract exemption under section 14(2)(c). The Court held that the High Court had answered a question different from the one referred and had no power to determine an unframed question. Since the proper issue was not before the High Court, the correct course was to set aside its judgment and remit properly framed questions for decision.

Conclusion: The appeal succeeded and the matter was remitted to the High Court for decision on the correct questions.

Final Conclusion: The reference was reopened for determination on the proper statutory questions, and no final adjudication on the assessee's tax liability was made by the Supreme Court.

Ratio Decidendi: In a tax reference, the High Court cannot decide a question other than the one referred to it, and where the real controversy is different from the framed question, the proper course is to set aside the judgment and remit correctly framed questions for decision.

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