A subordinate tribunal must carry out the directions of a superior tribunal.

Judgment

S. K. Das, J. : This is an appeal on a certificate under Art. 133 of the Constitution. The short question for decision is whether the learned Judicial Commissioner of Bhopal rightly dismissed a petition under Art. 226 of the Constitution made by the Bhopal Sugar Industries, Limited, hereinafter referred to as the appellant company, praying for the issue of an appropriate order or direction in the nature of a writ of mandamuus to compel the Income-tax Officer, Bhopal, respondent herein, to carry out certain directions given by the Income-tax Appellate Tribunal, Bombay, to the said officer in an appeal preferred by the appellant company from an order of assessment made against it by the respondent.

2. The relevant facts are these. The appellant company carries on the business of manufacturing and selling in various grades and quantities. It has its factory at Sehore which was formerly in the Bhopal State and is now situate in the State of Madhya Pradesh. It purchased sugarcane from local cultivators and also grew its own sugarcane in farms situate in that State, such sugarcane being used for its manufacture of sugar. During the year of account ending on September 30, 1950, the appellant company purchased 7,72,217 maunds of sugarcane from local cultivators at various purchasing centres, 14 in number, situate at a distance of about 8 to 22 miles from its factory. The price paid was Rs. 1-4-6 per maund, that being the price fixed by the then State of Bhopal. The average cost of transporting the sugarcane from the various centres to the factory was stated to be Rs. 0-4-9 per maund. During the same period the appellant company grew its own sugarcane to the extent of 6,78,490 maunds and brought the same along with the cultivators sugarcane to its factory for manufacturing sugar. For the sugarcane grown on its own farms the appellant company claimed Rs. 1-13-0 per maund as its market value (including Rs. 0-4-9 as average transport charges), the total market value for 6,78,490 maunds thus coming to Rs. 12,29,763. The appellant company deducted from the aforesaid market value a sum of Rs. 9,77,772 as agricultural expenses, namely, expenses of harvesting, loading etc. and claimed the balance of Rs. 2,51,991 as agricultural income to be deducted from the computation of its total income for the assessment year 1951-52 . The respondent accepted the figure of Rs. 9,77,772 as agricultural expenses but computed the market value of 6,78,490 maunds of sugarcane grown on the appellants company s own farms at Rs. 9,33,000 at the rate of Rs. 1-6-0 per maund; thus according to this computation there was a loss of Rs. 44,772 and the respondent held in his assessment order that the appellant company was not entitled to claim any deduction of agricultural income for the assessment year.

3. The appellant company then appealed to the Appellate Assistant Commissioner, Jubalpore, who determined the market value of the sugarcane grown on the appellant company s own farms at Rs. 10,07,132 at the rate of Rs. 1-7-9 per maund. This resulted in an agricultural income of Rs. 29,360, which the Appellate Assistant Commissioner allowed to be deducted from the total income of the appellant company.

4. Not satisfied with the order of the Appellate Assistant Commissioner, the appellant company preferred an appeal to the Income-tax Appellate Tribunal, Bombay, and claimed that the market value of the sugarcane grown on its farms should be Rs. 1-13-0 per maund and not Rs. 1-7-9. There was no dispute before the Tribunal as to the agricultural expenses, and the question which the Tribunal had to decide related to the market value of 6,78,490 maunds of sugarcane grown on the appellant company s own farms. After referring to R. 23 of the Income-tax Rules and certain other matters, the Tribunal said :

"We are, therefore, inclined to think that market within the meaning of rule 23 is not the centres but the factory where the assessee company manufactures sugar. This being