HOMELY INDUSTRIES versus THE SALES TAX OFFICER, SECTOR V, KANPUR

Citation: [1976] 3 S.C.R. 862 · Decided: 24-03-1976 · Supreme Court of India · Bench: HANS RAJ KHANNA · Disposal: Case Partly allowed

Judgment (excerpt)

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HOMELY INDUSTRIES 
v. 
THE SALES TAX OFFICER, SECTOR V, KANPUR 
March 24, 1976 
[H. R. KHANNA AND P. K. GOSWAMI, JJ.] 
U.P. Sales Tax Act-Secs. 1C(3)-8(1)(2)-Liability of heirs and legal 
representatives of a deceased assessee-Whether service of a notice condition 
precedent, to recovery proceedings. 
Rashidul Hasan was a dealer registered under the U.P. Sales Tax Act. 
During the lifetime of Rashidul Hasan, the Sales Tax Officer sept a notice to 
him asking him to appear and to produce all ~ooks of account, c~sh mem?s, 
bills, receipts, bank pass books, statement of income and expenditure which 
he may desire to produce. 
He died in December, 1968 leaving behind three 
adult sons. 
At the time of his death assessment proceedings relating to the 
assessment years 196()-61 and 
1961-62 were pending before 
the Sales T.:X 
Officer. 
After the death of Rasbidul Hasan. the business was continued by 
his sons by forming a partnership. His legal 
representatives 
obtained 
a 
number of adjournments in order to make an effective representation. After 
granting 6 adjournments the 7th Application for adjournment was rejected by 
the Sales Tax Officer and an ex-parte order of assessment was made in April, 
1969. The Sales Tax Officer thereafter initiated recovery proceedings in 
pursuance of the assessment orders and the demand was soueht to be realised 
from the sons of the deceased by coercive measure. 
Section 7C(3) of the Act provides that where a person havini: furnished a 
return dies and the assessing authority may determine the turnover of such per-
son and assess the tax payable by him on the basis of such determination and, 
for this purpose may by notice require from the legal representative of the 
deceased person any accounts. documents or other evidence which he might 
under the provisions of this Act require from the deceased person. 
Section 
8 ( 1 ) provides that the tax assessed under the Act shall be paid Within such time 
not being less than 15 days from the date of service of the notice of assess· 
ment. It further provides that in default of such payment the same may be 
recovered as arrears of land revenue. The appellant filed tw·o Writ Petition~ 
before the High Court of Allahabad challenging the orders and recovery certi-
ficates· issued under 'Section 8 of the Act. The High Court rejected the app1ie31-
tion. 
On appeal by certificate under Article 133 (!)(a) of the Constitution, tho 
appellant contended : 
(1) The assessment orders are invalid as they are made against a dead 
person, and that no notice as required by section 7C(3) was served 
on the legal representative to produce accounts, documents 
and 
other evidence. 
(2) A proper and valid notice which is a condition precedent for fixing 
liability under section 8 has not been served on the legal represen-
tatives and therefore the recovery proceedings were illegal. 
HELD : (1) The notice was already served on the deceased when he was 
alive. It was not necessary to serve the notice on legal representatives again 
under Sec. 7C(3). The legal representatives would have been entitled to a 
notice to produce documents and evidence if the deceased had not earlier been 
served with a similar notice during his life time. The orders of assessment 
cannot, therefore, he held to be invalid on account of non:.service of notice for 
production of documents Upon the legal representatives in this case. 
Besides 
the legal representatives were aware of the proceedings and 
toOk 
several 
adjournments and if they did not choose to produce any further evidence it 
was entirely their fattlt. [865 E, G, 866 A-BJ 
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HOMELY INDUSTRIES v. S.T.o. (Goswami, J.) 
863 
(2) It is clear that before a certificate proceeding can be instituted under 
'Section 8 a notice of demand is condition precedent. There can be no recovery 
without service of a demand notice. 
It is admitted that such notice has not 
heen served on the legal representatives. 
That being the position, the recovery 
proceedings are not maintainable in law and are invalid and the same along with 
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<:ertificateg are liable to be quashed. [867 C-D] 
Sahu Rajeshwar Nath v. Income·Tax Officer l.C. Ward Meerut, 72 I.T.R. 
617 S.C. distinguished. 
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 1176-77 of 
1971. 
From the Judgment and order dated the 17th March, 1970 of the 
Allahabad Court in Civil Misc. Writ Nos. 2681-82 of 1968. 
S. C. Manchanda. !. D. Jain, U

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