Justice Bobde, whose comments came just a week ahead of the General Budget, also made a case for speedy resolution of tax disputes, saying it will act as an incentive for tax payers and free the funds locked in litigation.
"While tax evasion is a social injustice to the fellow citizens, arbitrary or excessive tax also results in social injustice by a government," the CJI said at the 79th foundation day celebrations of the Income Tax Appellate Tribunal.
"Tax should be collected from people like honey bee draws nectar from flowers without harming it," he said and referred to ancient taxation laws in India.
The CJI said tax judiciary plays a very important role in resource mobilisation of the country and expressed concern over pendency of cases.
"A just and speedy dispute resolution is perceived as a tax incentive by the taxpayer. To the tax collector, an efficient tax judiciary assures that demands arising out of legitimate assessment are not strangled in delayed litigation," the judge said.
The pendency of appeal cases related to indirect taxes in the Supreme Court, High Court and CESTAT has reduced 61 per cent to 1.05 lakh in almost two years.
According to official data, total pendency of appeals at the Supreme Court, High Court and CESTAT (Customs Excise and Service Tax Appellate Tribunal) as on June 30, 2017, was 2,73,591, whereas the same significantly came down to 1,05,756 as on March 31, 2019, a reduction of 61 per cent.
With regard to direct taxes, as many as 3.41 lakh cases were pending before commissioner (appeals), while 92,205 cases were pending before the Income Tax Appellate Tribunal (ITAT) as on March 31, 2019.
Asked about setting up more tribunals for reducing pendency in High Courts and lower judiciary, the Chief Justice said, "You have to be careful that we don't only transfer pendency."
He further said people should know what is due from them and government should know what is due to them that can be achieved through early disposal of cases.
Justice Bobde emphasised on the use of next generation technology artificial intelligence to expedite the process with caution that it should not replace the human discretion required for delivering justice.
"I am firmly of the view based on experience of systems that have used artificial intelligence that it is only the repetitive area or decision making that is rates of taxation etc or something which is invariably the same which is in a sense mechanical that must be covered by artificial intelligence.
"I do not believe that artificial intelligence should ever be allowed to substitute the human discretion which is necessary for a just decision making," he said.