TMI Blog1967 (3) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... profits of the business which had escaped assessment issued on March 18, 1954, a notice under section 34(1)(a) of the Income-tax Act, 1922, to the assessee. The notice was, it is claimed, tendered to the son of the respondent and was accepted by him. The process server was informed that the respondent was in Bombay and that " it would take a week for him to return ". Being of the view that service of the notice on the respondent's son was irregular, the Income-tax Officer cancelled that notice and issued a fresh notice on March 24, 1954. This notice was affixed on March 25, 1954, to a conspicuous part of the business premises of the respondent by the process server in the presence of two persons and an endorsement was made on the notice that " At the above address on enquiry the owner (the assessee) was said to be in Bombay or in Ceylon, and, as directed by the Income-tax Officer, the notice was pasted at the premises of the company of the owner and that witnesses had also signed on the notice ". On March 25, 1954, the process server swore an affidavit in support of the truth of the endorsement, in the presence of the Income-tax Officer. After some correspondence the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eight years had elapsed after the expiry of the year unless the income, profits or gains chargeable to income-tax which have escaped assessment or have been under-assessed, amount to, or are likely to amount to, one lakh of rupees or more, in the aggregate. The period of eight years prescribed by the proviso to section 34(1)(a) for reassessment of the income of the respondent was expiring on March 31, 1954. Some time before that date the Income-tax Officer received information from which he had reason to believe that the respondent had failed to disclose fully and truly all material facts necessary for his assessment. The notice issued by the Income-tax Officer on March 24, 1954, was served not personally but by affixing it to the business premises of the respondent in the presence of two persons and an endorsement was made in that behalf. Service of notice prescribed by section 34 of the Income-tax Act, for the purpose of commencing proceedings for reassessment, is not a mere procedural requirement : it is a condition precedent to the initiation of proceedings for assessment under section 34. If no notice is issued or if the notice issued is shown to be invalid, then the procee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice can be made, 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." Rule 19 provides : " Where a summons is returned under rule 17, the court shall, if the return under that rule has not been verified by the affidavit of the serving officer, and may, if it has been so verified, examine the serving officer on oath, or cause him to be so examined by another court, touching his proceedings and may make such further inquiry in the matter as it thinks fit; and shall either declare that the summons has been duly served or order such service as it thinks fit." There is clear evidence on the record that the process-server affixed on March 25, 1954, on a conspicuous part of the business premises of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ken in a particular case amount to using all due and reasonable diligence must depend upon the circumstances of each case. The respondent was on March 25, 1954, not in Calicut. That is not denied. The only information which the process-server received on March 25, 1954, was that the respondent was " in Bombay or in Ceylon ". It was thereafter that the process-server affixed the notice on the business premises of the respondent. Thereby, prima facie, the statutory requirements were satisfied. The Tribunal has observed in its order that counsel for the respondent had stated that he gave the Bombay address of the respondent on March 8, 1954. Evidently, this statement was never made before the Income-tax Officer or the Appellate Assistant Commissioner, and no record appears to have been maintained of the statement. Again the statement is obscure : it is not stated whether it was made orally or in writing and even it does not state whether it was made to or given to the Income-tax Officer. Counsel for the respondent suggested that the date, March 8, 1954, was incorrectly recorded, it should be March 18, 1954, and that presumably it was the process-server who was informed about the " ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to be present, but also that if he was not found, proper and reasonable attempts were made to find him either at that address or elsewhere. If after such reasonable attempts the position still was that the party is not found, then and then only can it be said that he cannot be found. The principle laid down in that case is unexceptionable, but it has, in our judgment, no application in this case. In the present case attempts were made to serve the notice upon the respondent at his place of business. He was not then in Calicut. No definite information could be secured in spite of inquiries as to the whereabouts of the respondent, and only thereafter, the notice was served by affixing. The Income-tax Officer held the necessary inquiry and declared the notice duly served. In the circumstances, we do not think that there was any irregularity in the service of the notice under Order V, rule 17, of the Code of Civil Procedure, read with section 63 of the Income-tax Act. Counsel for the respondent said that before the Income-tax Officer a request was made that the two persons in whose presence the notice was affixed may be examined, but the Income-tax Officer did not examine them ..... X X X X Extracts X X X X X X X X Extracts X X X X
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