Reference jurisdiction under the Income-tax Act cannot be bypassed by remitting questions back to the Tribunal for fresh consideration.

In a reference under Section 256(1) of the Income-tax Act, the High Court had to answer the questions already referred on the facts found by the Tribunal and could not decline jurisdiction by remanding the matter for fresh consideration. The proper course was for the High Court to hear and dispose of the references afresh on the material already available. The Supreme Court held that the High Court's approach was incorrect, set aside the order under appeal, and restored the references to the High Court for fresh disposal.

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Issues: Whether the High Court, in a reference under Section 256(1) of the Income-tax Act, 1961, was correct in declining to answer the questions referred and remanding the matter to the Tribunal for fresh consideration.

Analysis: The references arose from questions of law already referred on the facts found by the Tribunal. The High Court was required to answer the referred questions within the limits of its reference jurisdiction and could not decline to do so by directing a fresh consideration by the Tribunal. The proper course was to have the references heard and disposed of afresh by the High Court on the material already available.

Conclusion: The High Court's approach was incorrect. The order under appeal was set aside and the references were restored to the file of the High Court for fresh disposal.

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