Sales-tax liability at year-end governed deductibility, and no referable question of law arose on the facts.

Sales-tax liability was required to be tested by reference to the position on the last day of the accounting year, and the demand was treated as subsisting on that date for the year ended 31 March 1974. Later developments could not alter the assessment for that year. On the facts and pending proceedings, the proposed reference was considered academic and no referable question of law was found. The reference application was therefore dismissed.

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Issues: Whether any referable question of law arose from the Tribunal's view that the sales-tax liability of Rs. 36,377 subsisted at the close of the accounting year and was therefore deductible.

Analysis: The liability had to be examined with reference to the position obtaining on the last day of the accounting year. On that date, the demand was treated as subsisting, and later developments could not govern the assessment for the year ended 31 March 1974. In view of the pending proceedings and the factual setting, the proposed reference was considered academic and no referable question of law was found.

Conclusion: No question of law arose for reference, and the reference application was dismissed.

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