9911796707
TMI Blog1999 (2) TMI 646X X X X Extracts X X X X X X X X Extracts X X X X ..... of 1941 Act. 2.. In brief, the case of the applicants is that respondent No. 2, Commercial Tax Officer, Strand Road Charge, made an ex parte order of assessment on best judgment for the period of four quarters ending December 31, 1986 under 1941 Act on October 12, 1990 demanding additional sales tax of Rs. 83,860.19 and turnover tax of Rs. 5,668.64 without disclosing any basis for such assessment. In the same order a penalty of Rs. 500 was imposed for late submission of returns. In terms of section 11(3) of 1941 Act read with rule 55(1) of 1941 Rules a notice of demand in form VII was issued to the applicant No. 1 directing it to pay the assessed dues on or before December 6, 1990. Thus, thirty days' time as enjoined by the aforesaid pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce the case was going to be barred by limitation, the prayer for time was rejected and the order of assessment was made. The returned figure of gross turnover was Rs. 56,72,996.96. But the respondent No. 2, the assessing authority, estimated the gross turnover at Rs. 65 lakhs to the best of his judgment. He allowed the claim under section 5(2)(a)(v) for Rs. 52,62,271.96. Thereafter he calculated tax and imposed a penalty of Rs. 500. The impugned demand notice dated October 12, 1990, signed by respondent No. 2 on October 31, 1990, was issued accordingly. The assessing authority did not disclose the basis on which he arrived at an estimated gross turnover at Rs. 65 lakhs. But the appellate authority (respondent No. 1) discussed the basis o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... down. The case of the applicants is that the impugned notice of demand directing payment on or before December 6, 1990 was received on November 19, 1990. There was, at the time of hearing, no denial of that claim. It appears from the top of the impugned notice in form VII at annexure page 2 that it was sent on November 3, 1990. Therefore, it was quite natural that it was received by the applicant-company on November 19, 1990. 5.. On those facts there is no doubt that the notice of demand is defective in so far as it relates to the date fixed for payment. 6.. After the appellate order dated February 18, 1993 was confirmed by the Board in its order dated October 27, 1997, the Commercial Tax Officer (respondent No. 2) was obliged to make ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent on behalf of the company that the appellate and revisional orders should be set aside and the order of assessment also. 8.. In a number of decisions of this Tribunal, it has been held that the notice of demand under section 11(3) serves two purposes, as argued by the learned State Representative. It was held in those cases by this Tribunal that if the notice is defective regarding the fixed date of payment due to want of thirty days after service thereof, then the entire notice does not become invalid, and the notice could be rectified by issuing a fresh notice of demand fixing a fresh date for payment after thirty days of service of such modified notice. In this case also, in the facts and circumstances, we hold accordingly. The impu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ys down that the assessed dues shall be demanded from the assessee (in prescribed form No. VII) by specifying a date which shall be not less than thirty days from the date of service of the notice. Sub-section (4) of section 11 makes it clear that no recovery proceeding can be commenced without service of a valid notice under section 11(3). There are two important elements in a demand notice: (a) the amounts assessed as tax or penalty; and (b) the date by which the payment should be made and such date must not be less than thirty days from the date of service of the notice. When one of the elements is missing, the notice becomes invalid, but such invalidity of the notice does not make the order of assessment invalid in any manner. The appea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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