Tax reference answers must be final and fact-specific; conditional findings tied to other appeals are impermissible.

In a tax reference, the High Court must give final, reasoned answers on the facts of the case and cannot make its conclusions contingent on the result of other pending proceedings. Questions about whether dividend distribution out of capital gains or salami from long-term leases arose required case-specific factual determination, and the assumption that the entire receipt was capital gain could not be sustained where compensation for compulsory acquisition is ordinarily capital in nature but statutory interest is income. Because the reference was wider than earlier appeals and the factual basis had not been properly determined, the order was set aside and the matter remanded for disposal according to law.

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Issues: Whether the High Court could dispose of the reference by giving answers made subject to the final result of other pending appeals, and whether the questions concerning dividend distribution out of capital gains and salami required a case-specific factual determination.

Analysis: A reference under the income-tax statute requires the High Court to record its own final answers with reasons. Conditional answers, made dependent on the outcome of other cases, are not final and cannot be treated as disposing of the reference. The nature of amounts received by the company, including compensation for compulsory acquisition and salami from long-term leases, had to be examined on the facts of the particular case. The court also noted that compensation for compulsory acquisition is ordinarily of a capital nature, while statutorily payable interest is income, so the assumption that the whole amount was capital gain could not be sustained. Since the scope of the present reference was wider than in the earlier appeals, the questions required reconsideration according to law.

Conclusion: The High Court's order was set aside and the reference was remanded for disposal according to law.

Ratio Decidendi: In a tax reference, the High Court must give final, reasoned answers on the facts of the case and cannot make its answers contingent on the result of other proceedings; where the factual basis has not been properly determined, remand is required.

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