Law:

Section:

Section 256 of the Income-tax Act, 1961 [Corresponding to section 66(2) of the Indian Income-tax Act, 1922] - High Court - Reference to - Assessment year 1954-55 - Whether where Tribunal refers one question and refuses to refer another question, it is not open High Court to reframe-former question so as to substitute in its place latter question - Held, yes - Whether when Tribunal is required to refer several questions and it refers only one of them it amounts to refusing to refer others and High Court can call for any one of them by exercising jurisdiction conferred by section 66(2) of 1922 Act - Held, yes FACTS The assessee, who was a managing agent of two companies, said to have entered into agreements with third parties, within the meaning of section 12-A of 1922 Act for sharing the managing agency commission in the proportion of 7 to 1. During the assessment proceedings it claimed that it was liable to be assessed only on 7/8th of the income received as the managing agency commission from each of the two companies, the remaining 1/8th income was liable to be assessed in the hands of the third parties but it filed no declaration of this fact. The ITO assessed it on the whole of the managing agency commission. On appeal, the AAC held that though the assessee was not entitled to the benefit of section 12-A of 1922 Act it was entitled to deduct the money paid to the third parties out of its commission under section 10(2) (xv) of 1922 Act. On an appeal by the department the Tribunal restored the order of the ITO. The finding of the ITO that the assessee had failed to fulfil the condition required for the benefit of section 12-A of 1922 Act was not challenged before the Tribunal. The Tribunal proceeded on the basis that the condition had not been fulfilled and that consequently the assessee was not entitled to the benefit of section 12-A of 1922 Act. As regards the benefit of section 10(2)(xv) of 1922 Act the Tribunal did not go into the question whether, on the facts the money paid to the third parties was liable to be deducted under section 10(2)(xv) of 1922 Act. On the other hand, it refused to go into that question, holding that a managing agent, who had…

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