TMI Blog1975 (4) TMI 32X X X X Extracts X X X X X X X X Extracts X X X X ..... 29, 1968, he was assessed under section 144 of the Income-tax Act, 1961 (hereinafter mentioned as if "the Act"), to the tune of Rs. 18,454 for the assessment year 1963-64, as the successor of M/s. Hunsraj Brothers. The demand notice, assessment order, etc., were not served on M/s Hunsraj Brothers. Proceeding for recovery of dues was started by the Tax Recovery Officer of Nawarangpur against the petitioner. He appeared before the Tax Recovery Officer and objected that he was not the successor and was not liable to pay the tax. On January 28, 1969, the objection of the petitioner was overruled on the ground that the validity of the assessment cannot be questioned before the Tax Recovery Officer. Petitioner filed appeal under rule 86 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of civil suit for recovery of the dues. As there are two alternative methods of recovery, the process of recovery through the Tax Recovery Officer being more onerous and disadvantageous to the assessee, exercise of option by the designated authorities to adopt any of the procedures is discriminatory and offends the provisions of article 14 of the Constitution ; (2) the income-tax authorities acted illegally in assessing the petitioner as successor to the transferor of the business as no notice was served on the transferor-firm for apportionment of the dues and the ownership of the business had not been transferred to the petitioner. Point No. 1 :--Section 232 of the Act is as follows : "232. The several modes of recovery specified i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nting a receiver for the management of the assessee's movable and immovable properties. (2) The Income-tax Officer may issue a certificate under sub-section (1), notwithstanding that proceedings for recovery of the arrears by any other mode have been taken," Elaborate provisions have been made in the Second Schedule for investigation and reasonable opportunity has been provided for appeal, revision and review. Those provisions embody principles of natural justice analogous to those observed in the trial of a suit. The provisions under the Second Schedule are in pari materia with the provisions embodied in Order 21 of the Code of Civil Procedure as well as the provisions of the Public Demands Recovery Act. Rule 86 provides for appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other provides the forum of an administrative tribunal, it cannot be said that the latter is necessarily more drastic and onerous. To attract the inhibition of article 14 there must be substantial and qualitative differences between the two procedures so that one is really and substantially more drastic and prejudicial. Superfine differences are bound to exist when two procedures are prescribed." This court while considering the provisions of recovery of dues under the State Financial Corporations Act in Civil Ref. No. 1 of 1972 (State Financial Corporation Ltd. v. Satpathy Brothers and Nanda Co. (P.) Ltd.), disposed of on March 18, 1975, followed the aforesaid decision and laid down that the choice of alternative procedure is not hit b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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