Binding revisional orders in tax matters prevent subordinate officers from issuing contrary demand notices or penalty demands.

A subordinate taxing cannot disregard a subsisting revisional order that has held tax or penalty not recoverable in respect of the consignments concerned. A revisional order under the taxing statute binds departmental authorities until it is set aside by the competent forum or altered through the statutory mechanism, and the proper remedy for disagreement is appeal or rectification, not a fresh demand inconsistent with that order. The impugned demand order and notice were therefore without authority and could not stand.

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Issues: Whether a Superintendent of Taxes could ignore a subsisting revisional order and issue a demand for tax or penalty that the revisional authority had held to be not recoverable.

Analysis: The revisional authority had already determined that recourse to the penalty provision was not permissible in respect of the consignments in question. A revisional order passed under the taxing statute binds subordinate authorities until it is set aside by the competent forum or dealt with in accordance with the statute. The proper course for the department, if it disputed the revisional determination, was to challenge it before the appellate forum or proceed under the statutory rectification mechanism, not to issue a fresh demand contrary to that order.

Conclusion: The Superintendent of Taxes had no authority to pass the impugned demand order or issue the demand notice in disregard of the revisional order; the challenge succeeded in favour of the petitioner.

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