Case: The Bhopal Sugar Industries Ltd Vs. The Income-Tax Officer, Bhopal

enough, the respondent misread the direction of the Tribunal and failed to carry it out. He proceeded on a basis which was in contravention of the direction of the Tribunal. 7. In these circumstances, the appellant company moved the Judicial Commissioner. Bhopal, then exercising the powers of a High Court for that area, for the issue of a writ to compel the respondent to carry out the directions given by the Tribunal. The learned Judicial Commissioner found in express terms that the respondent had acted arbitrarily and in clear violation of the directions given by the Tribunal; in other words, he found that the respondent had disregarded the order of the Tribunal, failed to carry out his duty according to law and had acted illegally. Having found this, the learned Judicial Commissioner went on to examine the correctness or otherwise of the order of the Tribunal and found that the Tribunal went wrong in not treating the centres as "markets" within the meaning of R. 23 of the Income-tax Rules. He then came to the conclusion that in view of the error committed by the Tribunal, there was no manifest injustice as a result of the order of the respondent; accordingly, he dismissed the application for the issue of a writ made by the appellant company. 8. We think that the learned Judicial Commissioner was clearly in error in holding that no manifest injustice resulted from the order of the respondent conveyed in his letter dated March 24, 1955. By that order the respondent virtually refused to carry out the directions which a superior tribunal had given to him in exercise of its appellate powers in respect of an order of assessment made by him. Such refusal is in effect a denial of justice, and is furthermore destructive of one of the basic principles in the administration of justice based as it is in this country on a hierarchy of Courts. If a sub-ordinate tribunal refuses to carry out directions given to it by a superior tribunal in the exercise of its appellate powers, the result will be chaos in the administration of justice and we have indeed found it very difficult to appreciate the process of reasoning by which the learned Judicial Commissioner while roundly condemning the respondent for refusing to carry out the directions of the superior tribunal, yet held that no manifest injustice resulted from such refusal. 9. It must be remembered that the order of the Tribunal dated April 22, 1954, was not under challenge before the Judicial Commissioner. That order had became final and binding on the parties, and the respondent could not question it in any way. As a matter of fact the Commissioner of Income tax had made an application for a reference, which application was subsequently withdrawn.The Judicial Commissioner was not sitting in appeal over the Tribunal and we do not think that in the circumstances of this case it was open to him to say that the order of the Tribunal was wrong and, therefore, there was no injustice in disregarding that order. As we have said earlier such a view is destructive of one of the basic principles of the administration of justice. 10. In fairness of him it must be stated that learned Counsel for the respondent did not attempt to support the judgment of the Judicial Commissioner on the ground that no manifest injustice resulted from the refusal of the respondent to carry out the directions of the superior tribunal. He conceded that even if the order of the Tribunal was wrong a subordinate and inferior tribunal could not disregard it; he readily recognised the sanctity and importance of the basic principle that a subordinate tribunal must carry out the directions of a superior tribunal. He argued, however, that the order of the Tribunal was unintelligible and the respondent did his best to understand it according to his light. This argument advanced on behalf of the respondent appears to us to be some what disingenuous. We find no difficulty in understanding the order of the Tribunal; it directed the respondent "to ascertain the average transport charges per maund from the centres to the factory and add to it the rate of Rs. 1-4-6 per maund of a sugarcane". The direction is clear and unambiguous. The respondent instead of ascertaining the average transport charges per maund from the centres to the factory, referred to the transport charges from the farms to the factory and on that footing disregarded the directions of the Tribunal; for the respondent to say thereafter that the order of the Tribunal was not intelligible betrays a regrettable lack of candour. We must, therefore, reject the argument of learned Counsel for the respondent. 11. The learned Judicial Commissioner referred to three decisions in support of the proposition that a direction or order in the nature of a writ of mandamus cannot be claimed as of right, nor need such a writ issue for every omission or irregularity; Bimal Chand v. Chairman, Jiagunj Azimgunj Municipality, AIR 1954 Cal 285 , Gram Panchayat, Vidul of Vidul v. Multi Purpose Co-operative Society of Vidul. AIR 1954 Nag 82, and Senairam Doongarmall v. Commr. of Income Tax, Assam (S) AIR 1955 Assam 201. In the view which we have expressed, namely, that by the impugned order the respondent failed to carry out a legal duty imposed on him and such failure was destructive of a basic principle of justice, a writ of mandamus should issue ex debito justitiae to compel the respondent to carry out the directions given to him by the Income-tax Appellate Tribunal, Bombay, and it is unnecessary to consider the decisions referred to above except merely to state that in none of them arose any question of condoning a refusal by an inferior tribunal to carry out the directions given to that tribunal by a superior tribunal in the undoubted exercise of its appellate powers, on the ground that the order of the superior tribunal was wrong.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]8. We think that the learned Judicial Commissioner was clearly in error in holding that no manifest injustice resulted from the order of the respondent conveyed in his letter dated March 24, 1955. By that order the respondent virtually refused to carry out the directions which a superior tribunal had given to him in exercise of its appellate powers in respect of an order of assessment made by him. Such refusal is in effect a denial of justice, and is furthermore destructive of one of the basic principles in the administration of justice based as it is in this country on a hierarchy of Courts. If asubordinate tribunalrefuses to carry out directions given to it by a superior tribunal in the exercise of its appellate powers, the result will be chaos in the administration of justice and we have indeed found it very difficult to appreciate the process of reasoning by which the learned Judicial Commissioner while roundly condemning the respondent for refusing to carry out the directions of the superior tribunal, yet held that no manifest injustice resulted from such refusal9. It must be remembered that the order of the Tribunal dated April 22, 1954, was not under challenge before the Judicial Commissioner. That order had became final and binding on the parties, and the respondent could not question it in any way. As a matter of fact the Commissioner of Income tax had made an application for a reference, which application was subsequently withdrawn.The Judicial Commissioner was not sitting in appeal over the Tribunal and we do not think that in the circumstances of this case it was open to him to say that the order of the Tribunal was wrong and, therefore, there was no injustice in disregarding that order. As we have said earlier such a view is destructive of one of the basic principles of the administration of justice10. In fairness of him it must be stated that learned Counsel for the respondent did not attempt to support the judgment of the Judicial Commissioner on the ground that no manifest injustice resulted from the refusal of the respondent to carry out the directions of the superior tribunal. He conceded that even if the order of the Tribunal was wrong a subordinate and inferior tribunal could not disregard it; he readily recognised the sanctity and importance of the basic principle that asubordinate tribunalmust carry out the directions of a superior tribunal. He argued, however, that the order of the Tribunal was unintelligible and the respondent did his best to understand it according to his light. This argument advanced on behalf of the respondent appears to us to be some what disingenuous. We find no difficulty in understanding the order of the Tribunal; it directed the respondent "to ascertain the average transport charges per maund from the centres to the factory and add to it the rate of Rs.6 per maund of a sugarcane". The direction is clear and unambiguous. The respondent instead of ascertaining the average transport charges per maund from the centres to the factory, referred to the transport charges from the farms to the factory and on that footing disregarded the directions of the Tribunal; for the respondent to say thereafter that the order of the Tribunal was not intelligible betrays a regrettable lack of candour. We must, therefore, reject the argument of learned Counsel for the respondent11. The learned Judicial Commissioner referred to three decisions in support of the proposition that a direction or order in the nature of a writ of mandamus cannot be claimed as of right, nor need such a writ issue for every omission or irregularity; Bimal Chand v. Chairman, Jiagunj Azimgunj Municipality, AIR 1954 Cal 285  , Gram Panchayat, Vidul of Vidul v. Multi Purposee Society of Vidul. AIR 1954 Nag 82, and Senairam Doongarmall v. Commr. of Income Tax, Assam (S) AIR 1955 Assam 201. In the view which we have expressed, namely, that by the impugned order the respondent failed to carry out a legal duty imposed on him and such failure was destructive of a basic principle of justice, a writ of mandamus should issue ex debito justitiae to compel the respondent to carry out the directions given to him by thex Appellate Tribunal, Bombay, and it is unnecessary to consider the decisions referred to above except merely to state that in none of them arose any question of condoning a refusal by an inferior tribunal to carry out the directions given to that tribunal by a superior tribunal in the undoubted exercise of its appellate powers, on the ground that the order of the superior tribunal was wrong.