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TMI Blog1957 (4) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... s not taken into account then. The explanation given in paragraph 3 of the counter affidavit was: At this time because of enemy occupation of Burma, the income from foreign business at Burma was not taken into account . Proceedings under section 34 of the Income-tax Act were taken in January, 1942. By then, it should be remembered both the partners had left for Burma. It was common ground before us that the branch office at Madras was closed in February, 1942, and the premises vacated. Eventually, service of the notice issued under section 34 was effected by affixture to the residence at Ilayangudi of the two partners, where their wives lived. The partners could however get no knowledge of these proceedings. The proceedings under section 34 were completed on 22nd March, 1944, in the absence of the partners of the assessee firm. They were not represented by any one else either. As the partners were still in Burma, no returns were filed by them for the assessment years 1940-41 and 1941-42. The assessments for these two years were completed under section 23(4) of the Act on 25th February, 1942, and 20th February, 1942, respectively. Notices of demand under section 29 for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he provisions of that Act. Order V, rule 12, directs : Wherever it is practicable, service shall be made on the defendant in person, unless he has an agent empowered to accept service, in which case service on such agent shall be sufficient . Rule 17 of Order V lays down the procedure to be adopted when personal service could not be effected under rule 12. The relevant portion of rule 17 runs: ......where, the serving officer, after using all due and reasonable diligence cannot find the defendant and there is no agent empowered to accept service of the summons on his behalf,......the serving officer shall affix a copy of the summons on the outer door or some other conspicuous part of the house in which the defendant ordinarily resides or carries on business or personally works for gain, and shall then return the original to the Court from which it was issued, with a report endorsed thereon or annexed thereto stating that he has so , affixed the copy, the circumstances under which he did so and the name and address of the person (if any) by whom the house was identified and in whose presence the copy was affixed . To make service by affixture effective, the requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 of the Act for the assessment year 1939-40, the question, whether the requirements of section 63 of the Act, which by its terms ultimately made the relevant provisions of Order V of the Code of Civil Procedure applicable, were satisfied, has to be answered with reference to the facts set out in paragraph 5 of the counter affidavit filed on behalf of the Department. That paragraph ran: On 16th January, 1942, a notice under section 34 of the Income-tax Act was issued and this was served by affixture in the presence of the assessee s wife in the following circumstances. On 2nd September, 1941, the assessee had been asked to send the Rangoon assessment order for 1939-40 to which no reply was received. In response to the section 34 notice the peon returned the cover on 31st January, 1942, saying the assessee had locked the door of the business premises (at Madras) and gone home. A cover sent by registered post on 16th January, 1942, was returned saying that the proprietor had left for Burma. The Income-tax Officer thereupon directed the Inspector to take a peon with him and serve it as it was unlikely that the assessee would have left for Burma at that time. The Inspector thereup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has to be decided with reference to the requirements of Order V, rule 17, and Order V, rule 19, of the Code of Civil Procedure. What rule 17 requires is that the serving officer after using all the due and reasonable diligence could not find the assessee . When the assessee was known to be in Rangoon, it was futile to took for him at Ilayangudi or to claim that he could not be found at Ilayangudi. Service by affixture under such circumstances could never be due service within the meaning of Order V, rule 19, of the Code of Civil Procedure. Besides, the further requirements of rule 19 were not satisfied in this case. What was really done in this case was to reduce the service of notice to a meaningless ritual. Due service under the enabling provisions of Order V, rule 17, and Order V, rule 19, of the Code of Civil Procedure should mean that the notice was served in such a way that the assessee had or could obtain knowledge of the proceedings under section 34, or at least the Income-tax Officer could bona fide believe that the assessee had or could have obtained such knowledge. With the assessee known to be in Rangoon, postal communication between which place and India was sever ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice of demand under section 29 with reference to the assessment for 1939-40 completed under section 34 was served in 1944 by affixture to the premises at Madras, which admittedly the petitioner had vacated in 1942. It is not necessary to discuss further the validity of that service, when the basis of the demand, the assessment under section 34, had itself no validity. The rule is made absolute in W.P. No. 250 of 1955. The order of assessment under section 34 is set aside. The petition is allowed with costs. Counsel s fee ₹ 250. The only point that the learned counsel for the petitioners wanted to be decided in W.P. Nos. 251 and 252 of 1955 was, whether the notices of demand issued under section 29 for the 1940-41 and 1941-42 assessments had been duly served on the assessee. There should be no difficulty in answering that question in the negative and in favour of the petitioners. Certificates under section 46(2) of the Act could be issued only if the assessee was in default; and under section 45 the petitioner firm could not have been in default when there was no due service of the notices of demand issued under section 29. These notices were served by affixture to the r ..... 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