Decided on February 06,1953

STATE Respondents


Rajamannar, C.J. - (1.) THESE are appeals under the Letters Patent against the judgment of Chandra Reddi J. dismissing a batch of applications under Article 226 of the Constitution. The points raised in all these petitions were the same and the petitions were all disposed of by a common judgment. The relief sought by the petitioner was the same in all the petitions and was in respect of proceedings taken for the enforcement of orders of assessment of excess profits tax and income-tax. The petitioners were assessed to income-tax and excess profits tax for several years and against the orders of assessment they have preferred appeals to the Appellate Assistant Commissioner of Income-tax and it is represented to us that the appeals are pending. Meanwhile, the petitioners have filed these applications to get rid of the same orders evidently provoked by the proceedings taken by the Income-tax authorities to collect the tax imposed on them.
(2.) THE only ground on which our jurisdiction under Article 226 is sought to be invoked is that the procedure contemplated by the Income-tax and Excess Profits Tax Acts offends against the constitutional guarantees contained in Part III of the Constitution, and in particular, the procedure violates the right guaranteed by Article 14 of the Constitution. We have heard learned counsel at great length but must confess that we are unable to see how Article 14 has any application whatever to the contentions raised on behalf of the petitioners. Broadly, the attack on the procedural provisions of the Income-tax Act falls into three heads. Firstly, it was said that Section 5(8), Income-tax Act violates the principle enunciated in Article 14 of the Constitution inasmuch as it affects the independence and impartiality of the assessing officer. Section 5(8) runs thus: "All officers and persons employed in the execution of this Act shall observe and follow the orders, instructions and directions of the Central Board of Revenue: Provided that no such orders, instructions or directions Khali be given so as to interfere with the discretion of the appellate Assistant Commissioner in the exercise of his appellate functions." At the outset, we may observe that it is not alleged by the appellants that in the cases before us there have been any orders, instructions or directions of the Central Board of Revenue which were followed by the assessing officer in making the assessments on the appellants. The contention was that Section 5(8) of the Act contemplates the issue of orders, instructions and directions by the Central Board of Revenue and the very possibility of this happening would render the entire proceedings of the assessing officers void as being a violation of the principle of equality of law embodied in Article 14 of the Constitution. In the first place, in our opinion, this provision, namely, Section 5 (8) does not contemplate orders, instructions and directions from the Central Board of Revenue to the assessing officer in any particular case. What is contemplated, we think, is the issue of general orders, instructions and directions to guide the subordinate officers in the execution of the duties laid on them by the several provisions of the Act. In the absence of any allegation that in the cases before us, any officer had followed any order, instruction or direction of the Central Board of Revenue in making any order adverse to the appellants, we do not think it necessary to embark on a general discussion of the validity of this provision. Moreover, we are also convinced that even if such orders, instructions and directions are issued in any particular case by the Central Board to the assessing officer, the principle of equality before law is not infringed in any manner. It was said that the assessing officer was performing judicial functions and therefore should not be subject to executive pressure or any extraneous influence. Assuming this is the correct position, we do not think the issue of directions by the Central Board of Revenue which is the chief income-tax authority under the Act is in the nature of outside or executive pressure or interference. Passages were cited to us from Wade and Phillips on Constitutional law and Robson's Justice and Administrative law. We are not concerned with any question of policy as to the desirability of having administrative tribunals to deal with the rights of citizens. Varying views have been held by eminent jurists and public men on this matter, and it is not the province of this Court to embark on a discussion of the merits or demerits of the system of administrative law. It suffices to say that there is nothing in Section 5(8), Income-tax Act which is inconsistent with the right guaranteed under Article 14 of the Constitution. Learned counsel was unable to cite any decided authority in support of his contention. The second head of argument was based upon the fact that the Income-tax Officer is not bound to disclose the material on which he finally makes the assessment and this circumstance also is inconsistent with the right guaranteed under Article 14. Here again we are unable to follow learned counsel. It is true that the Income-tax Officer is given wide powers to ascertain the income of the assessee, and the powers include the gathering of material without the knowledge of the assessee. This is a well known provision in taxing statutes. If the assessee is aggrieved by the order of assessment eventually passed by the officer, he is not without remedy. He can appeal to the several tribunals prescribed under the Act ending with this Court and he can prefer an appeal from this Court to the Supreme Court. The appellants have resorted to the remedy provided by the Act, and have filed appeals. In our opinion, they have no further right to attack the entire proceedings on this ground. Lastly, it was contended that the appellants have been denied the right to be heard. What counsel meant was that the appellants were not given an opportunity to test the worth of the evidence upon which evidently the Income-tax Officer made the assessment. It is not for us to say whether there should be provision enabling the assessee to lead evidence controverting the evidence which might have been gathered by the Income-tax Officer. All that we are called upon to decide is whether the procedure prescribed by the provisions of the Act as they stand is in any way in violation of any of the rights guaranteed by the Constitution. Learned counsel wanted to rely upon decisions of the Supreme Court of the United States on the due process clause of the Fourteenth. Amendment of the Constitution and (2) the system of assessment and procedure relating to it followed in England and in the United States. We refused to hear him on these points because we consider that these have no bearing on the question to be decided in this case. As already mentioned, the appellants in this case are content with urging these general grounds attacking the validity of the provisions of, the Income-tax Act and the procedure prescribed by them and have nothing whatever to say about the orders actually passed against them. Indeed, these orders are the subject-matter of appeals before the tribunal under the Act.
(3.) WE find no substance in any of the contentions raised on behalf of the appellants, and the appeals are therefore dismissed.;

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