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TMI Blog1965 (3) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... ptember, 1946. In September, 1946, the shareholding of the partners of the agency firm in the company was as follows : Kanpur group ... 32,500 shares Bombay group ... 26,362 shares 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 partners entered into an agreement with the firm of Messrs. Chhattu Ram and Sons of Bihar, hereinafter called the "purchaser firm." Under that agreement it was provided that 65,012 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peal 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 33A(2) 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, (i) 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y 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 an 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 ex facie confers a wide power on the High Courts to reach injustice wherever it is found. The Constitution d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 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 any the less 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 R. v. Manchester Legal Aid Committee 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 attempt 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. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ization of road transport made by the Andhra Pradesh Road Transport undertaking in Gullapalli Nageswara Rao v. Andhra Pradesh State Road Transport Corporation, the order of the Examination 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, U.P. v. Ghanshyam Das Gupta 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 Board of Revenue, U. P. v. Sardarni Vidyawati. 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w. 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 33A(2) 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 ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erence 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 33A took the place of section 33 with certain modifications. Sub-section (1) of section 33A provided for the Commissioner acting suo motu ; and sub-section (2) thereof, 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 hel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction, 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-rule (2) of rule 1 of Chapter XXII 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 v. Commissioner of Income-tax was given on different facts and that it was impossible to contend that any part of the money paid by Messrs. Chhatturam and 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 requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 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 : " 29. 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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