TELCO Vs. STATE OF JHARKHAND

JUDGEMENT

(1.) THE impugned notice dated 5.5.2001 has been issued by respondent No. 2 in purported exercise of power vesting in him under Section 19(1) of the Bihar Finance Act, 1981. This was followed by the communication dated the 31st July. 2001 from the same respondent. In the communication dated 31.7.2001 the petitioner was asked to furnish some additional information and to file some more documents.

(2.) A bare look at the impugned notice suggests that in so far as the procedural compliance with Section 19 is concerned, respondent No. 2 clearly appears to have misdirected himself, because even though the notice purportedly appears to be in terms of power vesting in him under Section 19(1) of the Act, the satisfaction of respondent No. 2 that reasonable grounds exist to believe that any exist to believe that any turnover of the petitioner escaped assessment or has been under -assessed or assessed at a rate lower than that which was clearly applicable, etc. etc. has not at all been shown to have been recorded either in the notice itself or in the contemporaneous records. On the other hand, it is an admitted case of the respondents that by a mechanical exercise of the so called jurisdiction, the respondent No. 2 has acted merely on the basis of, and because of an audit objection and, therefore, mechanically, the copy of the audit report has also been sent along with the impugned notice without indicating at all therein whether application of mind with regard to the satisfaction that reasonable grounds exist has been recorded or not. Section 19(l) of the Bihar Finance Act, 1981 reads thus :

(3.) BASED on our observation herein -above and because of the aforesaid statement of Mr. Poddar, this petition is allowed. The impugned notice dated 5.5.2001 and the consequential communication dated 31.7.2001 and the proceedings arising therefrom are quashed and set aside. However, it is open to the respondents, if so advised, to proceed afresh in accordance with law and in the even they do so, the petitioner shall be at liberty to contest the proceedings in all respects and if felt aggrieved in any manner, to approach this court again.