1969 (8) TMI 75 - HC - VAT and Sales Tax

Summary

Issues:
1. Validity of notice affixation under U.P. Sales Tax Rules.
2. Interpretation of modes of service under Rule 77 of the U.P. Sales Tax Rules.

Issue 1: Validity of Notice Affixation
The judgment addresses the validity of notice affixation under the U.P. Sales Tax Rules. The case involved an assessment year where the Sales Tax Officer reopened the case due to information about undeclared imports. The notice under section 21 of the Act was served through affixation as the assessee could not be located. The court analyzed Rule 77, which provides four alternative modes of service, emphasizing that affixation can only be used if other modes are impracticable. The court found that the Sales Tax Officer did not adequately justify why other modes were not feasible before resorting to affixation. The court held that the Sales Tax Officer must decide the practicability of modes, and the choice cannot be left to the process-server. The judgment concluded that the service by affixation in this case was contrary to Rule 77, ruling in favor of the assessee on this issue.

Issue 2: Interpretation of Modes of Service
Regarding the interpretation of modes of service under Rule 77, the court addressed whether service by affixation could be treated as falling under clause (b) of the rule. The court rejected this view, stating that clause (b) requires the notice to be left inside the business premises, not outside when the place is closed. The court emphasized that leaving a notice outside is not equivalent to leaving it inside, and accepting such an interpretation would render clause (b) redundant. The judgment cited previous court decisions supporting its interpretation of the rule. Ultimately, the court answered both questions in the negative, favoring the assessee and emphasizing that the department should bear the costs.

In conclusion, the judgment focused on the procedural aspects of service of notice under the U.P. Sales Tax Rules, highlighting the importance of following the prescribed modes of service and the role of the Sales Tax Officer in determining the practicability of each mode. The court's analysis provided clarity on the correct interpretation of Rule 77 and emphasized adherence to procedural requirements in tax assessments.