Report No. 14
16. No case for abolition of jurisdiction.-
We do not think that the figures collected bear out the very sweeping statements which have been made from time to time, in this connection. No doubt interim stay applications have been granted too readily by some of the High Courts in taxation matters as in other cases. The matter is, however, capable of being easily corrected and needs no such drastic remedy as has been advocated. If greater care is to be exercised in granting interim stays in writ applications generally, even greater care is needed in dealing with applications which concern the assessment and collection of Central or State taxes. If such care is exercised, there need be no apprehension of any interference in any substantial degree in the assessment and collection of taxes.
One may not forget, in this connection, that several reported cases indicate that the grant of an order of stay even in taxation matters was fully justified in as much as the orders made were manifestly unjust and oppressive. It may be that some cases, particularly cases involving questions as to the jurisdiction of the officer conducting the assessment or of the vires of the substantive or the procedural laws, must involve a stay of proceedings. The remedy, in such cases, is to expedite the hearing of these matters, giving them precedence in the list of Article 226 matters posted for hearing. Indeed a general rule may be made by the High Courts giving precedence, in the matter of hearing, to all applications concerning the assessment and collection of Central and State taxes.
17. Territorial Jurisdiction of High Courts under Article 226.-
The decision of the Supreme Court in the case of the Election Commission v. Saka Venkata Rao, AIR 1953 SC 210. has greatly restricted the utility of the jurisdiction conferred on the High Courts by Article 226. The court has held that, in order to enable the High Court to exercise jurisdiction under that article, the authority against whom the order or direction is sought must be located within the jurisdiction of the High Court. The Government of India and several statutory authorities and Tribunals, the operations of which extend throughout the country, have their headquarters in Delhi.
As a result of that decision, High Courts other than the High Court of the Punjab have found themselves unable to exercise jurisdiction under Article 226, when the statutory authority or official concerned has headquarters in Delhi. This tends to defeat the very purpose of the jurisdiction conferred by Article 226 which is to enable a person to seek a remedy under that article in respect of acts done in violation of his rights within the State by an application to the High Court of his own State.
A later decision of the Supreme Court1 seems to have modified the earlier view but the matter is by no means clear.
1. A. Thangal Kunju Mudaliar v. M. Venkatachalam Potti, AIR 1956 SC 246.
Need for modification.- In our view, this hardship imposed upon a person seeking relief needs removal.
19. Summary of recommendations.-
Our recommendations regarding the writ jurisdiction of the High Courts under Article 226 may be summarised as follows:-
(1) The writ jurisdiction of the High Courts has served a very useful purpose and should under no circumstances be restricted.
(2) The strength of the High Courts should be increased wherever necessary to enable them to deal with this extra work expeditiously.
(3) Writ petitions should be disposed of within a period of six months from the date of their institution. The present duration of these petitions in some of the High Courts is too long.
(4) These petitions should be carefully scrutinised at the admission stage and a rule nisi issued only in proper cases.
(5) It should be for the individual High Courts to decide, having regard to the local circumstances, whether writ petitions should be heard by a single judge or by a bench in the first instance.
(6) Rules should be framed by the High Courts on the lines indicated in our Report on the Specific Relief Act to enable them to record evidence and to determine, if necessary, disputed questions of fact in proper cases in proceedings under Article 226.
(7) The courts should be circumspect in granting stays in writ petitions and normally stay should be ordered only after giving notice to the respondent and hearing him.
(8) In emergent cases, when an ex-parte stay is ordered, it should be operative only for a very short time within which the respondent should be served with notice and heard.
(9) Care should be particularly exercised in granting stays in revenue matters in which it is proposed to stay the assessment or collection of taxes.
(10) Steps should be taken to remove the hardship on the citizen created by the decision in Election Commission v. Saka Venkata Rao.