1956 (4) TMI 33 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Validity of service of notice under section 14(4) of the Bihar Sales Tax Act, 1947, in accordance with rule 44 of the Bihar Sales Tax Rules, 1949.
2. Whether the appeals were time-barred.

Detailed Analysis:

1. Validity of Service of Notice:
The primary issue was whether the notice under section 14(4) of the Bihar Sales Tax Act, 1947, was served in compliance with the provisions of rule 44 of the Bihar Sales Tax Rules, 1949. The assessee contended that the notices were not properly served and that he only became aware of the assessment order on March 21, 1950. The Sales Tax Officer had attempted to serve the notice by affixing it on the shop premises of the assessee and the office building of the pleader, Mr. Gauripati Mazumdar, after the latter refused to accept it. The court examined the relevant provisions, including section 24(1) and (2) of the Bihar Sales Tax Act and rule 44 of the Bihar Sales Tax Rules. Rule 44 specifies that notices may be served by delivery or tender to the addressee, his agent, or by post. If these methods fail, the Sales Tax Authority must order service by affixing a copy on a conspicuous part of the addressee's office or residence. The court found that the peon did not obtain the Sales Tax Authority's order before affixing the notice, and the pleader did not acknowledge the service by making an endorsement on the notice. Therefore, the court concluded that there was no valid service of notice within the meaning of rule 44.

2. Whether the Appeals Were Time-Barred:
The second issue was whether the appeals were time-barred under section 24(2) of the Bihar Sales Tax Act. The Commissioner had summarily dismissed the appeals on the ground that they were filed beyond the stipulated period of forty-five days from the receipt of the notice issued under section 14(4). The court held that since there was no valid service of notice, the appeals presented on April 7, 1950, were not barred by limitation. The court emphasized that the procedure prescribed by the proviso to rule 44(1) is an important safeguard for the assessee and must be construed to have peremptory effect. Since the proviso to rule 44(1) was not followed, the appeals were not barred by limitation, and the Commissioner should have heard the appeals on merits and disposed of them in accordance with law.

Conclusion:
The court answered the questions of law in favor of the assessee and against the State of Bihar. It held that there was no valid service of notice under rule 44, and the appeals were not time-barred. The assessee was entitled to the costs of the reference, with a consolidated hearing fee of Rs. 250 for all three cases. The reference was answered accordingly.