Appeal No 62 of 1964
Appeal by special leave from the judgment and decree dated July 28 1959 of the Allahabad High Court in Civil Miscellaneous Writ No 2071 of 1959
A V Viswanatha Sastri Rameshwar Nath section N Andley and P L Vohra for the appellant
Gopal Singh and R N Sachthey for the respondents
The Judgment of the Court was delivered by Subba Rao J
The facts leading up to this appeal may briefly be narrated
Gujarat Cotton Mills Co Ltd hereinafter called the Company is a limited company having its registered office at Ahmedabad
In the year 1938 the Company appointed Messrs Pira Mal Girdhar Lal  Co hereinafter called the Agency Firm as its Managing Agents
On February 28 1938 a formal agreement was entered into between the Company and the Agency Firm
The said Agency Firm was formed under an instrument of partnership dated February 26 1938 with 11 partners 3 of them are compendiously described as the Bombay Group and the remaining 8 of them as the Kanpur Group
With certain variations in the constitution of the Agency Firm the said firm functioned as the Managing Agents of the Company till September 1946
In September 1946 shareholding of the partners of the Agency Firm in the Company was as follows Kanpur Group 32500 shares
Bombay Group 26362 shares
538 Because of certain differences between the partners they decided among themselves to sell their shares and to surrender their Managing Agency
On September 7 1946 the said 11 partakers entered into an agreement with the firm of Messrs Chhuttu Ram  Sons of Bihar hereinafter called the Purchaser Firm
Under that agreement it was provided that 65012 shares held by the 11 partners of the Agency Firm directly or through their nominees should be sold to the Purchaser Firm at Rs 65 per share and that the Agency Firm should before November 15 1946 resign its office of Managing Agency of the Company
It was a condition of the agreement that it should have operation only after the Purchaser Firm or its nominees were appointed as the Managing Agents of the Company
On October 30 1946 the Company held its General Body Meeting and accepted the resignation of the Agency Firm and by another resolution appointed the Purchaser Firm as the Managing Agents in its stead
In terms of the agreement the Purchaser Firm paid for the entire shareholding of the partners of the Agency Firm at Rs 65 per share
The appellant is a Hindu undivided family
Its karta was one Dwarkanath and the present karta is his son Ramji Prasad
The said family was one of the II partners of the Agency Firm belonging to the Kanpur Group
Out of the total shareholding the appellant held 11230 shares
It received the price for the said shares at the rate of Rs 65 per share
It was assessed to income tax for the year 1948 49 and the Income tax Officer by his order dated June 5 1952 assessed the excess amount of Rs 298909 realized by the assessee under the head income from business ie the difference in the amount for which it purchased the shares and that for which it sold them
On appeal the Appellate Assistant Commissioner of Income tax confirmed the same
On further appeal the Income tax Appellate Tribunal Delhi Bench held that the said receipt bad to be taxed as capital gains under section 12B of the Income tax Act 1922 and directed the Income tax Officer to modify the assessment in accordance with its order
The assessee made an application under section 35 of the Income tax Act to the Tribunal for further directions and the Tribunal by its order dated March 26 1954 amended its previous order dated August 3 1953 by substituting the word processed in place of the word assessed in its previous order
The assessee raised various contentions before the Income tax Officer inter alia that the said income was not liable to be taxed under section 12B of the Income tax Act under the head capital gains and that in any case in order to determine the amount of capital gains the market value of the shares only should be taken into consideration as the price of Rs 65 per share included also the consideration for the relinquishment of the managing agency rights
The Income tax Officer rejected the said contentions of the assessee
He redetermined the assessable income under the heading capital gains but did not issue a notice of demand as prescribed in section 29 of the Income tax Act
After making an infructuous attempt to get suitable directions 539 from the Appellate Tribunal on March 5 1956 the assessee filed an application before the Income tax Officer to issue a notice of demand under section 29 of the Income tax Act so that it might prefer an appeal against the same to the appropriate authority
But the Income tax Officer refused to issue any such notice
The assessee preferred an appeal against that order to the Appellate Assistant Commissioner under section 30 of the Income tax Act and that was dismissed on March 8 1957 on the ground that it was not maintainable
Meanwhile on September 27 1956 the appellant filed an application before the Commissioner of Income tax under section 33A2 of the Income tax Act for revising the order of the Income tax Officer dated September 28 1955
On March 28 1959 the Commissioner dismissed the revision petition on two grounds namely 1 that it was not clear whether the revision petition under section 33A of the Income tax Act was maintainable and ii on merits
It may be noticed that long before the revision petition was dismissed the appeal filed by the assessee against the order of the Income tax Officer to the Appellate Assistant Commissioner was dismissed on March 8 1957
On November 18 1957 the attention of the Commissioner was also drawn to the fact that the Bombay High Court in the case of a reference to that Court at the instance of the Bombay Group held that the market value of the shares should be taken into consideration to ascertain the excess realized on the sale of the shares of the assessee for the purpose of capital gains tax
The Commissioner ignored that decision in dismissing the revision
Thereafter on July 28 1959 the assessee filed Writ Application No 2071 of 1959 in the High Court of Judicature at Allahabad inter alia for a writ of certiorari or any other direction or order of like nature to quash the order of the Incometax Commissioner Lucknow dated March 28 1959 and the Order of the Income tax Officer dated September 28 1955 and for a writ of mandamus or any other order or direction of the like nature directing the Commissioner to pass a fresh order in accordance with the decision of the Bombay High Court and direct the Income tax Officer to pass a fresh order in accordance with law and to issue a notice of demand as required by section 29 of the Income tax Act
The High Court dismissed the said application in limine mainly on the following three grounds 1 the affidavit filed in support of the writ petition was highly unsatisfactory and on the basis of such an affidavit it was not possible to entertain the petition 2 the facts given in the affidavit were incomplete and confused and 3 even on merits there was no force in the revision petition Hence the appeal
Mr AV Viswanatha Sastri learned counsel for the appellant contended that the affidavit filed in support of the petition was in accordance with law and that even if there were any defects the Court should have given an opportunity to the appellant to rectify them and that the High Court should have held 540 that the revision against the order of the Income tax Officer to the Commissioner was maintainable under section 33A of the Act as the appeal against that order to the Appellate Assistant Commissioner was not maintainable and that it should have directed the Commissioner to entertain the revision and dispose of it in accordance with law directing the Income tax Officer to issue a notice of demand under section 29 of the Income tax Act
He further contended that the High Court went wrong in holding that the facts in the Bombay decision were different from those in the present case for the facts in both the cases were the same and in fact they arose out of the same transaction namely the sale of the shares by the Agency Firm to the Purchaser Firm
Mr Gopal Singh learned counsel for the Revenue while supporting the order of the High Court raised a preliminary objection namely that the order of the Commissioner under section 33A of the Income tax Act was administrative act and therefore no writ of certiorari would lie to the High Court to quash that order under article 226 of the Constitution
We shall first take the preliminary objection for if we maintain it no other question will arise for consideration
Article 226 of the Constitution reads    every High Court shall have power throughout the territories in relation to which it exercises jurisdiction to issue to any person or authority including in appropriate cases any Government within those territories directions orders or writs including writs in the nature of habeas corpus mandamus prohibition quo warranto and certiorari or any of them for the enforcement of any of the rights conferred by Part III and for any other purpose
This article is couched in comprehensive phraseology and it exfacie confers a wide power on the High Courts to reach injustice wherever it is found
The Constitution designedly used a wide language in describing the nature of the power the purpose for which and the person or authority against whom it can be exercised
It can issue writs in the nature of prerogative writs as understood in England but the scope of those writs also is widened by the use of the expression nature for the said expression does not equate the writs that can be issued in India with those in England but only draws an analogy from them
That apart High Courts can also issue directions orders or writs other than the prerogative writs
It enables the High Courts to mould the reliefs to meet the peculiar and complicated requirements of this county
Any attempt to equate the scope of the power of the High Court under article 226 of the constitution with that of the English Courts to 541 issue prerogative writs is to introduce the Unnecessary procedural restrictions grown over the years in a comparatively small country like England with a unitary form of government into a vast country like India functioning under a federal structure
Such a construction defeats the purpose of the article itself
To say this not to say that the High Courts can function arbitrarily under this article
Some limitations are implicit in the article and others may be evolved to direct the article through defined channels
This interpretation has been accepted by the Court in Basappa vs Nagappa1 and PJ Irani vs State of Madras2
But we are satisfied that this case falls directly within the confines of the certiorari jurisdiction as understood in England
It is well settled that a writ of certiorari can be issued only to quash a judicial or a quasi judicial act and not an administrative act
It is therefore necessary to notice the distinction between the said two categories of acts
The relevant criteria have been laid down with clarity by Atkin LJ in King vs Electricity commissioners3 elaborated by Lord Justice Scrutton in Rex vs London County Council4 and authoritatively restated in Province of Bombay vs Kusaldas section Advani5
The said decisions laid down the following conditions to be complied with 1 The body of persons must have legal authority 2 the authority should be given to determine questions affecting the rights of subjects and 3 they should have a duty to act judicially
So far there is no dispute
But in decided cases particularly in India there is some mixing up of two different concepts viz administrative tribunal and administrative act
The question whether an act is a judicial act or an administrative one arises ordinarily in the context of the proceedings of an administrative tribunal or authority
Therefore the fact that an order was issued or an act emanated from an administrative tribunal would not make it anytheless a quasi judicial act if the aforesaid tests were satisfied
The concept of a quasi judicial act has been conceived and developed by English Judges with a view to keep the administrative tribunals and authorities within bounds
Parker J in RV Manchester Legal Aid Committee1 brought out the distinction between judicial and administrative acts very vividly in the following passage The true view as it seems to us is that the duty to act judicially may arise in widely different circumstances which it would be impossible and indeed inadvisable to define exhaustively  
When on the other hand the decision is that of an administrative body and is actuated in whole or in part by questions of policy the duty to act judicially may arise in the course of arriving at that decision
Thus if in order to arrive at the decision the 1  2  3 4 5  6  428542 body concerned had to consider proposals and objections and consider evidence then there is the duty to act judicially in the course of that inquiry     
Further an administrative body in ascertaining facts or law may be under a duty to act judicially notwithstanding that its proceedings have none of the formalities of and are not in accordance with the practice of a court of law     
If on the other hand an administrative body in arriving at its decision at no stage has before it any form of his and throughout has to consider the question from the point of view of policy and expediency it cannot be said that it is under a duty at any stage to act judicially
The relevant principles have been succinctly stated in Halsbury s Laws of England 3rd Edn Vol 11 at pp
55 and 56 thus It is not necessary that it should be a court an administrative body in ascertaining facts or law may be under a duty to act judicially notwithstanding that its proceedings have none of the formalities of and are not in accordance with the practice of a court of law
It is enough if it is exercising after hearing evidence judicial functions in the sense that it has to decide on evidence between a proposal and an opposition
A body may be under a duty however to act judicially and subject to control by means of these orders although there is no form of lis inter partes before it it is enough that it should have to determine a question solely on the facts of the particular case solely on the evidence before it apart from questions of policy or any other extraneous considerations Moreover an administrative body whose decision is actuated in whole or in part by questions of policy may be under a duty to act judicially in the course of arriving at that decision  
If on the other hand an administrative body in arriving at its decision has before it at no stage any form of lis and throughout has to consider the question from the point of view of policy and expediency it cannot be said that it is under a duty at any time to act judicially
These are innumerable decisions of this Court where it issued a writ of certiorari to quash a quasi judicial act of an administrative tribunal or authority
This Court set aside the order of the Andhra Pradesh State Government approving the order of nationalisation of road transport made by the Andhra Pradesh Road Transport Undertaking in Gullapalli Nageswara Rao vs Andhra Pradesh State Road Transport Corporation1 the order of the Examination 1 1959 Supp 1 SCR 319543 Committee cancelling the examination results on the ground that it did not give opportunity to the examinees to be heard before the order was made in Board of High School and Intermediate Education UP Allahabad vs Ghanshyam Das Gupta1 and the order of the Revenue Board made in a revision petition against the order of the Deputy Commissioner impounding the document without hearing the aggrieved party in The Board of Revenue UP vs Sardarni Vidyawati2
In all these cases the Government the Examination Committee and the Board of Revenue were administrative bodies but the acts impugned were quasi judicial ones for they had a duty to act judicially in regard thereto
The law on the subject may be briefly stated thus The provisions of a statute may enjoin on an administrative authority to act administratively or judicially
If the statute expressly imposes a duty on the administrative body to act judicially it is a clear case of a judicial act
But the duty to act judicially may not be expressly conferred but may be inferred from the provisions of the statute
It may be gathered from the cumulative effect of the nature of the rights affected the manner of the disposal provided the objective criterion to be adopted the phraseology used the nature of the power conferred or the duty imposed on the authority and other indicia afforded by the statute
In short a duty to act judicially may arise in widely different circumstances and it is not possible or advisable to lay down a hard and fast rule or an inflexible rule of guidance
With this background let us look at the relevant provisions of the Income tax Act
Section 33A2
The Commissioner may on application by an assessee for revision of an order under this Act passed by any authority subordinate to the Commissioner made within one year from the date of the order or within such further period as the Commissioner may think fit to allow on being satisfied that the assessee was prevented by sufficient cause from making the application within that period call for the record of the proceeding in which such order was passed and on receipt of the record may make such inquiry or cause such inquiry to be made and subject to the provisions of this Act pass such order thereon not being an order prejudicial to the assessee as he thinks fit
Provided that the Commissioner shall not revise any order under this sub section if a where an appeal against the order lies to the Appellate Assistant Commissioner or to the Appellate Tribunal but has not been made the time within which such appeal may be made has not expired 1962 Supp 3 SCR 362 1962 Supl3 SCR 50  544 or in the case of an appeal to the Appellate Tribunal the assessee has not waived his right of appeal or b where an appeal against the order has been made to the Appellate Assistant Commissioner the appeal is pending before the Appellate Assistant Commissioner or c the order has been made the subject of an appeal to the Appellate Tribunal
Provided further that an order by the Commissioner declining to interfere shall be deemed not to be an order prejudicial to the assessee
Under this sub section an assessee may apply to the Commissioner for revision of an order under the Act by an authority subordinate to him
Such application shall be filed within one year from the date of the order or within such further period as the Commissioner may think fit to allow
On receipt of such an application the Commissioner may call for the record of the proceeding in which such order was made and make such enquiry or cause such enquiry to be made
After such enquiry he can make an order not to the prejudice of the assessee but to his benefit
Such revision is not maintainable if the time prescribed for an appeal against such an order to the appropriate authorities has not expired or if an appeal against such an order is pending before the appropriate authorities
The scope of the revision is therefore similar to that prescribed under different statutes
Prima facie the jurisdiction conferred under section 33A2 of the Act is a judicial one
The order that is brought before the Commissioner affects the right of the assessee
It is implicit in revisional jurisdiction that the revising authority shall give an opportunity to the parties affected to put forward their case in the manner prescribed
The nature of the jurisdiction and the rights decided carry with them necessarily the duty to act judicially in disposing of the revision
The fact that the Commissioner cannot make an order to the prejudice of an assessee does not possibly change the character of the proceeding
Though the Commissioner may not change the order of the inferior authority to the prejudice of the assessee he may not give the full relief asked for by the assessee
But it is said that the Commissioner exercising jurisdiction under section 33A of the Act is only functioning as an administrative authority and all his orders made thereunder partake that character
Reliance is placed on the decision of the Judicial Committee in Commissioner of Income tax Punjab NWF  Delhi Provinces Lahore vs Tribune Trust Lahore1
There the Judicial Committee held that the assessments which were duly made by the Income tax 1947 LR 74 IA 306 317 318 545
Officer in the proper exercise of his duty were not a nullity but were validly made and were effective until they were set aside and that a reference to the High Court did not lie from an order under section 33 of the Act unless that order was prejudicial to the assessee in the sense that he was in a worse position than before the order was made
But the Board incidentally made the following observations On the contrary section 33 follows a number of sections which determine the rights of the assessee and is itself as its language clearly indicates intended to provide administrative machinery by which a higher executive officer may review the acts of his subordinates and take the necessary action on such review
It appears that as a matter of convenience a practice has grown up under which the commissioner has been invited to act of his own motion under the section and where this occurs a certain degree of formality has been adopted
But the language of the section does not support the contention which lies at the root of the third question and is vital to the respondent s case that it affords a claim to relief
Continuing the same idea that Board observed The Commissioner may act under section 33 with or without invitation of the assessee if he does so without invitation it is clear that if he does nothing to worsen the position of the assessee the latter can acquire no right the review may be a purely departmental matter of which the assessee knows nothing
If on the other hand the commissioner acts at the invitation of the assessee and again does nothing to worsen his position there is no justification for giving him a new right of appeal
These observations were made in the context of a question whether a reference would lie to the High Court against an order of the Commissioner
But the question whether the order of the Commissioner under section 33 of the Act was a judicial or a quasi judicial act subject to the prerogative writ of certiorari was neither raised nor decided in that case that question was not germane to the enquiry before the Board for the appeal did not arise out of any order made in a writ of certiorari
Section 33 which was considered by the Privy Council was repealed by the Amending Act of 1939 but by Act XXIII of 1941 the revisional powers of the Commissioner were restored
Section 33 A took the place of section 33 with certain modifications
Sub section 1 of section 33A provided for the Commissioner acting suo motu and sub section2thereof on the application of the assessee
Under this section the Commissioner can exercise the revisional jurisdiction subject to the conditions mentioned therein
While section 33 only provided for the suo motu exercise of the jurisdiction section 33A enables an assessee to apply to the Commissioner to revise the order of his subordinate officer
Some of the High Courts under the impression that the Privy Council held that the act of the Commissioner was an administrative one ruled that a writ of certiorari
would not lie to quash the order of the Commissioner under section 33A of the Act see Sitalpore Colliery Concern Ltd vs Union of India1 Additional Income tax Officer Cuddapah vs Cuddapah Star Transport Co Ltd2 and Suganchand Saraogi vs Commissioner of Income tax Calcutta3
They did not consider the scope of the revision before the Commissioner and whether the orders made thereunder satisfied the well settled tests of judicial act laid down by this Court
In our view for the reasons mentioned by us earlier the said judgments were decided wrongly
That apart on the assumption that the order of the Commissioner under section 33 A of the Act was an administrative one the respondent would not be in a better position
What the appellant complains is that the Income tax Officer in terms of section 29 of the Act is under an obligation to issue a demand notice
If the said contention was correct he did not discharge the duty imposed on him by the statute
If the Commissioner only made an administrative order in refusing to give any direction to the Income tax Officer it would not exonerate the said officer from discharging his statutory duty
In that event the assessee would certainly be entitled to approach the High Court under article 226 of the Constitution for the issue of a writ of mandamus or other appropriate direction to the Income tax Officer to discharge his statutory duty
We therefore reject the preliminary objection of the respondents
The High Court mainly dismissed the writ petition on the ground that the affidavit flied in support of the writ petition was highly unsatisfactory and that on the basis of such an affidavit it was not possible to entertain the petition
In exercise of the powers conferred by article 225 of the Constitution and of other powers enabling it in that behalf the High Court of Allahabad framed the Rules of Court
Chapter XXII thereof deals with the procedure to be followed in respect of a proceeding under article 226 of the Constitution other than a writ in the nature of habeas corpus
The relevant rule is sub r2 of r 1 of ChXXII which reads The application shall set out concisely in numbered paragraphs the facts upon which the applicant relies and the grounds upon which the Court is asked to issue a direction order or writ and shall conclude with a prayer stating clearly so far as circumstances permit the exact nature of the relief sought
The application shall be accompanied by an affidavit or affidavits in proof of the facts referred to in the application
Such affidavit or affidavits shall be restricted to matters which are within the deponent s own knowledge
The application filed in the High Court certainly complied with the provisions of sub r2 of r 1 of ChXXII of the Rules of Court of the Allahabad High Court
It set out concisely in numbered paragraphs the facts upon which the applicant relied the grounds on which the Court was asked to issue the direction and the exact nature of the relief sought
But it is said that the affidavit filed in support of the application did not speak to matters which were within the deponent s own knowledge
Dhruva Das the deponent of the affidavit is a relative of the petitioner and he also looked after the case on his behalf as his pairokar and was fully conversant with the facts
He solemnly affirmed and swore as follows I Dhruva Das aforesaid deponent do hereby solemnly affirm and swear that the contents of paras 1 2 3 and 50 partly are true to my personal knowledge that the contents of paras4 5 6 7 8 9 1011 12 13 14 15 16 20 21 25 27 29 partly 31 32 34 37 3841 42 44 are based on 46 and 50 partly and paras 17 18 19 22 23 24 26 28 29 partly 30 33  35 36 39 40 43 48 partly are based on perusal of the record those of paras 47 48 partly 49 and 50 partly are based on legal advice which I believe to be true that no part of this affidavit is false and nothing material has been concealed in it
In paragraphs which are based on a perusal of the record the deponent referred to the relevant orders of the Income tax authorities and also to the relevant agreements and the copies of the said orders and agreement were also annexed to the affidavit as schedules
It is not clear from the schedules whether certified copies or the original of the orders received by the appellant were filed
The said agreements and the orders afford sufficient basis to appreciate the case of the appellant and for disposing of the same
Deponent s own knowledge in r 12 of ChXXII of the Rules is wide enough to comprehend the knowledge of the appellant derived from a perusal of the relevant documents and the affidavit in express terms disclosed and specified the documents the source of the appellant s knowledge
He swore in the affidavit that the documents annexed to the affidavit were true copies of public documents
If they are certified copies of public documents they prove themselves if they are original of the orders sent to the appellant the deponent as his agent speaks to their receipt
It is therefore not correct to say that the facts stated in the affidavit are not based on the deponent s knowledge
The other facts alleged in the affidavit are only introductory in nature and if they are excluded the result will not be affected
That apart if the affidavit was defective in any manner the High Court instead of dismissing the petition in limine should have given the appellant a reasonable opportunity to file a better affidavit complying with the provisions of r 1 of ChXXII of the Rules
We cannot therefore agree with the High Court that the petition was liable to be dismissed in limine in view of the alleged defects in the affidavit
548 Nor can we agree with the High Court that the facts given in the affidavit are incomplete and confused
On the other hand a careful perusal of the affidavit along with the documents annexed thereto discloses clearly the appellant s case it gives the necessary facts and the reliefs sought for
We do not find any missing link in the narrative of facts or any confusion in the nature of the reliefs asked for
We cannot also agree with the High Court that the decision of the Bombay High Court in Baijnath Chaturbhuj vs Commissioner of Income tax Bombay City 111 was given on different facts and that it was impossible to contend that any part of the money paid by Messrs Chaturam  Sons was really compensation for the managing agency rights
The Bombay decision was given in the context of the dispute between the Bombay Group and the Income tax authorities and was based upon the consideration of the very documents which are the basis of the appellant s claim
We do not propose to express any opinion on the correctness or otherwise of that decision
But the fact that a Division Bench of one of the High Courts in India had taken the view in favour of the appellant indicates that the question raised is in our view an arguable one and it requires serious consideration
We are satisfied that this is not a case where the High Court should have dismissed the writ petition in limine
We find in the decree issued by the High Court that Sri Gopal Behari appeared on behalf of the opposite parties presumably he appeared as the appellant must have issued notice in terms of r 14 of ChXXII of the Rules
Be that as it may the High Court did not finally decide two important questions that really arose for consideration before it namely i whether a revision lay to the Commissioner under section 33 A2 of the Act against the order of the Income tax Officer and ii whether the Income tax Officer should have issued a demand under section 29 of the Act
If a revision lay to the Commissioner the Commissioner should have considered the second question before dismissing it
Therefore the question is whether a revision lay to the Commissioner under section 33 A2 of the Act
A revision does not lie to the Commissioner against an order where an appeal against that order lies to the Appellate Assistant Commissioner but has not been made and the time within which such an appeal may be made has not expired or where an appeal against the order has been made it is pending before him
It follows that if no appeal lies against the order an officer to the Appellate Assistant Commissioner the Commissioner can revise that order under section 33 A of the Act
In the present case pursuant to the directions of the Tribunal Delhi Bench the Income tax Officer determined the assessee s capital gains under section 12 B of the Act but the Income tax Officer did not make any order under section 233 of the Act nor 1957 31TR 643
549 did he issue a regular notice of demand as prescribed under section 29 of the Act
The result was no appeal lay against the computation made by the Income tax Officer to the Appellate Assistant Commissioner
Indeed on March 8 1957 the Appellate Assistant Commissioner rejected the appeal filed by the appellant as being not maintainable
As no appeal lay to the Appellate Assistant Commissioner against the calculations made by the Income tax Officer the Commissioner had certainly power to revise the said order
On March 5 1956 the appellant flied an application requesting the Income tax Officer to issue a notice of demand as required by section 29 of the Act
But the said Officer declined to issue the notice of demand
The question is whether he was bound to issue a notice of demand under section 29 of the Act
Section 29 of the Act reads When any tax penalty or interest is due in consequence of any order passed under or in pursuance of this Act the Income tax Officer shall serve upon the assessee or other person liable to pay such tax penalty or interest a notice of demand in the prescribed form specifying the sum so payable
Under this section if a tax is due in consequence of an order from an assessee the Income tax Officer is under a duty to serve on him a notice of demand
Pursuant to the directions given by the Tribunal the Income tax Officer made fresh calculations under the head capital gains  and ascertained the amount due from the assessee
In the circumstances pursuant to the said calculation he should have passed an order and issued a notice of demand to the assessee
In not doing so it must be held that the Income tax Officer did not discharge his duty which he was bound to do under the Act with the result he had become amenable to a writ of mandamus directing him to do what he should have done under the Act
In the result the order of the High Court is set aside and we issue a writ of certiorari quashing the order of the Commissioner and a writ of mandarnus directing the Income tax Officer to pass an order and issue a notice in accordance with law
The appellant will have his costs throughout
Appeal allowed


Summary:
Pursuant to the directions of the Income tax Appellate Tribunal the Income tax Officer determined the assessee s capital gains under section 12B of the Income tax Act 1922
He did not however make any order under section 233 of the Act nor did he issue a notice of demand under section 29 of the Act
The assessee filed an application before the Commissioner of Income tax under section 33A2 of the Act for revising the computation made by the Income tax Officer drawing his attention to a decision of the Bombay High Court in Baijnath s case  as to how the capital gains should be ascertained
That decision was based upon a consideration of the very documents which were the basis of the assessees  claim
The Commissioner dismissed the revision petition as not maintainable as well as on merits ignoring the Bombay decision
Meanwhile the assessee filed an application requesting the Income tax Officer to issue a notice of demand under section 29 to enable him to file an appeal but the Officer declined to do so
The assessee filed a writ application in the High Court for issuing appropriate writs to the Commissioner and the Income tax Officer but the High Court dismissed it in limine
In his appeal to this Court the assessee contended that i the High Court erred in holding that the affidavit filed in support of the writ petition was not in accordance with law and that even if there were any defects the High Court should have given him an opportunity to rectify them and ii the High Court erred in distinguishing the Bombay decision and in holding that there was no force in the revision filed before the Commissioner and that the High Court should have directed the Commissioner to entertain the revision and dispose of it in accordance with law by giving suitable directions to the Income tax Officer
The respondent raised a preliminary objection that as the order of the Commissioner was an administrative act article 226 of the Constitution could not be invoked
HELDi As no appeal lay to the Appellate Assistant Commissioner against the calculations made by the Income tax Officer the Commissioner had powers under section 33A2 to revise the Income tax Officer s order
The jurisdiction conferred on the Commissioner by the section is a judicial one The nature of the jurisdiction and the rights decided carry with them necessarily the duty to act judicially in disposing of the revision
Further the fact that a Division Bench of one of the High Courts in India had taken a view in favour of the assessee indicated that the question raised was arguable and required serious consideration
Therefore a writ of certiorari quashing the order of the Commissioner dismissing the assessee s revision petition should be issued
544E G 548D 537 Sitalpore Colliery Concern Ltd vs Union of India  Additional Income tax Officer Cuddapah vs Cuddapah Star Transport Co Ltd and Suganchand Saraogi vs Commissioner of Income tax  overruled
Even if the Commissioner only made an administrative order in refusing to give any direction to the Income tax Officer the assessee would still be entitled to approach the High Court under article 226 and a writ of mandamus directing the Income tax Officer to discharge his statutory duty of passing the order and issuing the notice of demand in accordance with law should be issued
546C E iiThe affidavit filed on behalf of the assessee was complete and compiled with the rules made by the High Court
The affidavit spoke only of matters which were within the deponent s own knowledge because the phrase deponent s own knowledge is wide enough to comprehend the knowledge derived from a perusal of relevant documents
Even if the affidavit was defective in any manner the High Court instead of dismissing the petition in limine should have given the assessee a reasonable opportunity to file a better affidavit
547F G H iiiThe High Court was also in error in holding that the decision of the Bombay High Court was given on different facts for the facts in both cases were the same and they arose out of the same transaction
548B C