The principles of judicial discipline and propriety and binding precedent, are as follows :

(a) Judicial discipline and propriety are the two significant facets of administration of justice. The principles of judicial discipline require that orders of the higher appellate authorities are followed unreservedly by the subordinate authorities. The mere fact that the order of the appellate authority is not “acceptable” to the Department, in itself an objectionable phrase, or that is the subject matter of an appeal can furnish no ground for not following it unless its operation has been suspended by a competent court. If this healthy rule is not followed, the result will only be undue harassment to assessees and chaos in administration of tax laws.

(b) Just as judgments and orders of the Supreme Court have to be faithfully obeyed and carried out throughout the territory of India under article 141 of the Constitution, so should be judgments and orders of the High Court by all inferior courts and tribunals subject to supervisory jurisdiction within the State under articles 226 and 227 of the Constitution.

(c) If an officer under the Income-tax Act, 1961 refuses to carry out the clear and unambiguous direction in a judgment passed by the Supreme Court or High Court or the Income-tax Appellate Tribunal, in effect, it is denial of justice and is destructive of one of the basic principles in the administration of justice based on hierarchy of courts.

(d) Unless there is a stay obtained by the authorities under the Income-tax Act, 1961 from a higher forum, the mere fact of filing an appeal or special leave petition will not entitle the authority not to comply with the order of the High Court. Even though the authority may have filed an appeal or special leave petition, where it either could not obtain a stay or the stay is refused, the order of the High Court must be complied with. Mere filing of an appeal or special leave petition against the judgment or order of the High Court does not result in the assailed judgment or order becoming inoperative and unworthy of being complied with.

Referred, UOI v. Kamalakshi Finance Corporation Ltd (1992) Suppl (1) SCC 443 , Official Liquidator  v. Dayanand ( 2008) 10 SCC 1 , Kishore Samrite v. State of Uttar Pradesh ( 2013) 2 SCC 398 , Bishnu Ram v. Prag Sikia  ( 1984) 2SCC 488 , Bhopal Sugar Industries Ltd v. ITO ( 1960) 40 ITR 618(SC), AIR 1961 SC 182 , CIT v. Ralson Industries Ltd ( 2007) 288 ITR 322 SC / (2007) 2 SCC 326, UOI v. Namit Sharma (2013) 100 SCC 359 , Dr. H. Phunindre Singh v. K.K. Sethi (1998) 8 SCC  640 , Ghaziabad Development Authority v. Balbir Singh  (2004) 5 SCC 65 , Asit Kumar Das v. J.Panda , The Chief Post Master General (CA No 1227 of 2015 dt 22-1 -2015, Pramod Kumar Dixit v. Central Administrative Tribunal (WP No. 1082 (SB) of 2009  dt .15 -12- 2010, Sadanand Mukerji v.State of U.P.2009 (1) UPLBBEC 167 , PCIT v. Assocciated Cables Pvt Ltd (ITA No. 293 of 2016 dt . 3-8 -2018 (Bom)(HC)

Court directed the Registrar General to forward the copy of the judgement for circulating amongst authorities  under the Income  tax- Act , 19961 and for the observance of the principles of the judicial discipline and propriety