JAGANNATH PRASAD Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE controversy raised in this petition falls within a very narrow compass. We will set out only such facts as are necessary for the disposal of this application. THE question that arises is as to whether there was valid service of the notice of demand on the assessee, petitioner No. 1. THE petitioner, in his petition, has alleged that no notice of demand was served on him. In order to ascertain the facts correctly we directed Sri Deokinandan, counsel for the department, to produce the relevant papers. THE "record was produced in court. From the record, it appears that N. D. challan for interest and challan for regular payment and I. T. 30 Form were sent by the process server addressed to the petitioner, assessee No. 1, on October 3, 1972 ; the process server on the back of this made the following endorsement in Hindi which translated runs:

(2.) ON October 4, 1972, i.e., on the next day, the Income-tax Officer passed the following orders:

(3.) NOW, if the matter is considered with reference to Order V, Rule 17 and Rule 19, in view of the large number of decisions that have been cited before us of other courts and of this court, the service would not be sufficient. This position would hardly be disputed by Shri Deokinandan, counsel for the revenue. In view of this we think it unnecessary to refer to cases under Order V, Rule 17. We now proceed to consider as to whether service can be held to be sufficient on account of the provisions of Order V, Rule 20. We have already extracted Rule 20. Before action under Rule 20 can be taken two conditions must exist, one, that the court has reason to believe that the defendant is keeping out of the way for the purpose of avoiding service or that for any other reason the summons cannot be served in the ordinary way. We will avoid going into the controversy as to whether the satisfaction of the court regarding these two conditions must be recorded in a written order. Nevertheless, there must be material on the record on the basis of which y reasonable person might come to the conclusion that either of these conditions is satisfied. The satisfaction of the court contemplated by Order V, Rule 20 is an objective satisfaction. It is not a subjective one and, as such, relevant material must exist on the record to justify this conclusion. Counsel for the revenue has urged that inasmuch as the Income-tax Officer passed the impugned order it must be taken that he was satisfied that one or the other of these conditions existed. We are unable to concur with this view. The report given by the process server was to the effect that he had made enquiries at a number of places but could not find out, which, in the context, means the assesses. After this report the Income-tax Officer passed an order for affixture. From the mere fact that the process server could not find out the assessee it would not lead to the conclusion that the assessee was keeping out of the way for the purpose of avoiding service or that for any other reason the summons cannot be served. The report does not indicate that more than one attempt made by the process server. On the contrary, it indicates that on a single attempt he enquired at a number of places but could not find out the assessee. This, in our view, cannot constitute sufficient material for the satisfaction of the Income-tax Officer that the conditions requisite for the application of Order V, Rule 20, existed. The order of the Income-tax Officer directing service by affixture is based on no relevant material on the record and, as such, has to be struck down.