Case: Excise and Taxation Officer, Punjab, and Another Vs. Vishesher Nath Kashmiri Lal

1. The respondents in these six appeals are all dealers carrying on business in the State of Punjab. They were all assessed to sales tax by the assessing authority, the Excise and Taxation Officer, Jullundur, under the Punjab General Sales Tax Act, 1948 (No. 46 of 1948). The assessments were best judgment assessments unders (4), (5) and (6) of section 11 of that Act. The respondents challenged these orders of assessment before the High Court of Punjab in petitions under Articles 226 and 227 of the Constitution on the ground that all the assessment orders had been made after the expiry of three years from the end of the periods to which the assessments related, and since the assessments were not completed within the period of three years mentioned ins (4), (5) or (6) of section 11, the assessments were without jurisdiction and void. This plea was accepted by the High Court and all the assessment orders were quashed. The original orders in the writ petitions were made by a Single Judge and the appeals to the Division Bench were summarily dismissed. The Excise and Taxation Officer, and the Deputy Excise and Taxation Commissioner have now come up to this Court in these appeals under certificates granted by the High Court.

Reasoning:
This argument cannot be accepted, because it ignores the circumstance that proceedings for assessment of the respondent were actually initiated on the 8th March, 1961, when a notice in Form S.T. XIV prescribed under the Rules framed under the Punjab General Sales Tax Act was issued in the name of the respondent. The issue of that notice on 8th March, 1961, resulted in initiation of proceedings against the respondent and, consequently, it cannot be said that the proceedings were started after the expiry of the period of limitation prescribed ins (4), (5) and (6) of section 11In the case of the respondent in C.A. No. 292/1967 now before us, as we have already indicated earlier, the notice for the best judgment assessment was issued on 8th March, 1961, and that was within three years of the period to which the assessment related. Consequently, on this ground, the assessment order cannot be quashed.However, we think that there is considerable force in the second point urged on behalf of the respondent, viz., that the assessment of the respondent was made by the assessing authority without giving him an adequate opportunity of being heard. The first notice of 8th March, 1961, was held by the assessing authority himself not to have been properly served, and the second notice of 23rd March, 1961, was also obviously not properly served. The service which was accepted by the assessing authority was affixation at a shop which used to be visited by the respondent. The shop was not his own and his place of residence was known. No attempt was made to serve the notice on him at his residence. In these circumstances, the proceedings taken ex parts against the respondent were not justified. On this ground alone, the order of the High Court quashing the assessment has to be upheld.