JUDGMENT S.C. Manchanda, J. - This is a writ petition under Article 226 of the Constitution of India directed against an assessment order dated, the 2nd of March, 1962, purporting to have been made under, Rule 23 of the U.P. Sales Tax Rules, hereinafter referred to as the Rules, and against an order dated the 18th November, 1961, requiring the petitioner to deposit, the balance of the Exemption Fee of Rs. 8,000/-, and in addition Rs. 3,112.36 nP. which was collected by the petitioner, M/s. Luxa Upbhogta Co-operative Society Ltd., Surya Kunda, Varanasi, hereinafter referred to as the Society from its members as exemption fee. 2. The facts leading upto this petition are these. The petitioner is a registered Society. It was formed in 1948 for the purposes of distribution of food-grains and cloth to consumers during the period these commodities were under rationing and control. The Society commenced business on the 30th August, 1948 and closed down in June 1951, after rationing was lifted. When rationing was re-introduced in respect of food-grains, the Society revived its activities in November, 1956, for the distribution of food-grains according to the Government Regulations and to work the Government Scheme of distribution popularly known as the Fair Price Shop Scheme", hereinafter, referred to as the "Scheme." Under the Scheme, the Society used to purchase food-grains from Government at the price fixed by the Government from time to time and the Society in its turn supplied the food grains to the card-holders belonging to a certain income group on prices fixed by the Government. The work of distribution was carried on by the various shops opened by the Society in various parts of the City of Varanasi. The Society was not free to purchase food-grains in the open market nor was it free to supply food grains supplied by Government to anyone else except to card-holders who were entitled to draw such rationed quantity of food-grains and at the price fixed by Government. 3. The Sale of food-grains was exempted by Government front payment of sales-tax under Notification dated the 31st March, 1956, issued under Section 4 of the U.P. Sales Tax Act, hereinafter referred to as the Act. The exemption fee was, however, subject to the payment of an exemption fee of Rs. 18/- to Rs. 8,000/-depending on the turnover of the particular dealer. The exemption fee was, however, subject to the payment of an exemption fee of Rs. 18/- to Rs. 8,000/-depending on the turnover of the particular dealer. On the 13th of April, 1957, the Society applied for the grant of an exemption certificate and a sum of Rs. 18/- being the minimum exemption fee was deposited. 4. On the 16th November, 1961, the Sales Tax Officer, Sector II, Varanasi, hereinafter referred to as the S. T. O. called for the accounts of the Society in order to ascertain the turnover and for determining the quantum of the exemption fee which was to be paid by the Society. The account books were produced which were found to be correctly maintained and the total turnover of the food grains for the year 1-4-1957 to 31-3-1958 was determined to be a sum of Rs. 10,63,837.96 nP. on which the maximum exemption fee of Rs. 8,000. was payable under the Notification referred to here in above. The Society in the beginning considered that if was not a "dealer" as it was a registered Co-operative Society and therefore did not recover from its member consumers anything towards exemptions fee. Later on, however the Society started charging exemption fee from the members at the rate of three pies per rupee and the total amount collected in this way on account of exemption fee by the Society amounted to Rs. 11,112.36 nP. After scrutinising the accounts of the Society, the S.T.O. passed finally an exemption order for the relevant assessment year 1957-58. The relevant portion of this order reads :- "According to these records their total sales during the year amounted at Rs. 10,63,837.96 nP. On which they have also collected from the customers. The books produced were on examination found to have been kept in order. The Exemption due over it amounts at Rs. 8,000/-. Since they have already collected Rs. 11,112.36 nP. so the excess collection of Rs, 3,112.36 nP. is to be deposited by them the Government Treasury under Section 8-A (4). Since they have already deposited Rs. 18/- so the entire balance of Rs. 11,094.36 nP. The Exemption due over it amounts at Rs. 8,000/-. Since they have already collected Rs. 11,112.36 nP. so the excess collection of Rs, 3,112.36 nP. is to be deposited by them the Government Treasury under Section 8-A (4). Since they have already deposited Rs. 18/- so the entire balance of Rs. 11,094.36 nP. must be deposited in the Government Treasury within a week of the receipt of this order." The said order was served on the Society on 1st of January, 1962, and the Society under the aforesaid final orders of exemption dated the 18th of November, 1961, was entitled within a week to pay the amount demanded thereby. The week expired on the 7th or 8th January, 1962. But before that time expired, on the 5th January, 1962, the Society presented an application to the S.T.O. praying for extension of time until February, on the ground that the President of the society Mr. Chandra Shekhar Prasad was out of station and had gone to Patna. No order on this application was, however, communicated to the society nor the society enquired as to the fate of the application made. The Society presumed that some orders would be passed on the application and when communicated they would deposit the amount due on the return on the President of the Society from Patna in February. Without any further communication to the Society, the S.T.O. treated the assessee (Society) to be in default for non-payment of the exemption fee and proceeded to make an assessment under Rule 23 of the Rules. Before this assessment was made a notice was said to have been issued, dated, the 14th February, 1962, which, incidentally was a notice before the month of February had expired - the period for which extension by the Society had been applied for on the 5th of January, 1952. This notice reads:- You were assessed to an Exemption Fee of Rs. 11,112.36 nP. vide Exemption order dated 18-11-1961 in which you were directed to deposit the balance of Rs. 11,094.36 nP. towards Exemption Fee by 7-1-1962, failing which you were informed to be assessed to tax on the your entire turnover covered with the Exemption certificate. In spite of this you have not cared to deposit the balance of Exemption Fee so far. vide Exemption order dated 18-11-1961 in which you were directed to deposit the balance of Rs. 11,094.36 nP. towards Exemption Fee by 7-1-1962, failing which you were informed to be assessed to tax on the your entire turnover covered with the Exemption certificate. In spite of this you have not cared to deposit the balance of Exemption Fee so far. Please appear in person on 27-2-62 at 11 A.M. and show cause why you should not be assessed to tax under Rule 23 on the entire turnover . In case of absence it would be presumed that you have nothing to say in the matter and the assessment would therefore be completed ex-parte". This notice clearly stated that the assessment would be made ex-parte under Rule 23, if there was no compliance with that notice. On the back of this notice there is a report by the process server Phekoo Singh, peon in the Sales Tax Office. The report is that as the office of the society remained closed he had affixed the notice on the 26th February, 1962, on the outer of the office of the Society. The time when this notice was affixed was not noted. An affidavit was filed by the process-server but no particulars of the attesting witnesses or the occasion or the time at which he had visited the premises of the Society was mentioned. The time at which he had made the affixture was also not disclosed in the affidavit. The affidavit filed by the said peon is, therefore, extremely vague, to say the least. The petitioner did not appear in compliance with this notice as according to it the notice was never served upon it. An ex-parte assessment under Rule 23 of the Rules, was thereupon made on the 2nd of March, 1962. The relevant portion of this order reads :- ".........The exemption case was taken up and exemption Order was passed on 18-11-1961 through which the total turnover of food grains during the year was determined at Rs. 10,63,837.96 nP. on which they had already collected Rs. 11,112.36nP. from their customers which through the above mentioned order they had been ordered to deposit after deducting Rs. 18/- already deposited, but they did not deposit even a single pie. So a notice was issued to them in this regard for appearance on 27-2-1962 and to explain their case. 10,63,837.96 nP. on which they had already collected Rs. 11,112.36nP. from their customers which through the above mentioned order they had been ordered to deposit after deducting Rs. 18/- already deposited, but they did not deposit even a single pie. So a notice was issued to them in this regard for appearance on 27-2-1962 and to explain their case. But they did not appear on this date as well nor applied for adjournment. Under such circumstances I am left with no alternative but to proceed with the case ex-parte and assess them to tax under Rule 23 at 3 per rupee in their entire turnover of food grains. They are therefore, finally assessed to a tax of Rs. 16,622.47 nP. on the above net turnover at rate of tax for the year ending March 31, 1958. Whole of this amount must be deposited in the Government Treasury within thirty days of the receipt of this order and notice of demand". 5. Notice of demand was served on 14th February, 1962, on the Society pursuant to the order of assessment under Rule 23, dated the 2nd March, 1962. This was the first intimation received, according to the petitioner of the said assessment order having been passed. The assessment under Rule 23, recognises the necessity for issuing a notice before proceeding to make an assessment. The S.T.O. has noticed that no application for adjournment was made and no one appeared on the date fixed in the said notice for appearance on 27th February, 1962. In this order however the S.T.O. has evidently overlooked to mention the fact that an application for extension of time for the payment of Exemption Fee was moved by the Society on the 5th January, 1962 and upon which he had passed no orders. 6. The assessment order under Rule 23, per se raised the assessee's liability from the maximum Exemption Fee of Rs. 8,000/-payable under the final order of Exemption Fee passed to more than double that figure as the assessment made on the entire turnover at 3 pies per rupee under Rule 23 worked out to a tax demand of Rs. 16,622.47 nP. The assessment order under Rule 23, per se raised the assessee's liability from the maximum Exemption Fee of Rs. 8,000/-payable under the final order of Exemption Fee passed to more than double that figure as the assessment made on the entire turnover at 3 pies per rupee under Rule 23 worked out to a tax demand of Rs. 16,622.47 nP. So far as the petitioner was concerned this was undoubtedly a serious matter for it as its tax liability was more than doubled, for the only reason that the Society had made a default in the payment of the Exemption Fee within the time stipulated. An ex-parte assessment having been made, the assessee was also deprived of its right of bringing to the notice of the S.T.O. its grievance against the withdrawal of the final exemption order. The present writ petition is therefore, directed against the aforesaid assessment order under Rule 23, dated the 2nd of March, 1962 and the demand requiring the Society to deposit Rs. 11,112.36 nP. instead of the maximum Exemption Fee of Rs. 8,000/- leviable under the Notification. 7. The first question which falls for determination in this case its whether the society can be said to have failed to pay the amount of Exemption Fee so found due from it within the period fixed by the S.T.O. If the Society had committed such a default then only in law, would the S.T.O. have been entitled to proceed to assess to tax under Rule 23 for the whole year, that is by ignoring the exemption which had been granted. The relevant provisions in this respect are as follows :- "Rule 20-B (h): The fee deposited under any of foregoing sub-rules shall be provisional and upon the expiry of the assessment year the Sales Tax Officer shall, after such enquiry as he may deem necessary, determine the turnover of the assessment year and finally fix the exemption fee payable thereon. (i) If the exemption fee fixed under sub-Rule (h) differs from the total amount deposited during the year the difference shall be paid by the dealer, or refunded by the sales Tax Officer, as the case may be. If the dealer fails to pay the amount found so due from him within the period fixed by the Sales Tax Officers, he shall be assessed to tax for the whole year. Rule 23. If the dealer fails to pay the amount found so due from him within the period fixed by the Sales Tax Officers, he shall be assessed to tax for the whole year. Rule 23. Assessment of tax if no certificate obtained :- If no exemption certificate as provided in Rules 19, 20, 20-B, 21 or 22 is obtained by a dealer, he shall be liable to tax as if the provisions of the notification under Section 4 did not apply to him". Under Sub-Clause (h) of Rule 20-B, the S.T.O. has to after making such enquiries as he may deem fit, finally fix the Exemption Fee payable thereon. It necessarily follows that he cannot fix the Exemption Fee which is beyond the maximum provided under the Notification viz. Rs. 8,000/- There is no provision any where in the Act entitle the S.T.O. to fix an Exemption Fee beyond the maximum of Rs. 8,000/- provided in the Notification. Therefore, before passing the Order which he described to be a final order of Exemption Fee he would appear to have clearly circumvented the said Notification as regards the maximum Exemption Fee leviable. That apart, assuming for the sake of argument that the order (Annexure `I') was validly passed levying exemption fee of Rs. 11,112.36 nP. which was beyond the maximum Exemption Fee of Rs. 8,000/- passed under the Notification and a certain time for the payment had been specified therein, there is nothing in the Act or the Rules which prevented the S.T.O. from entertaining an application for extension of time for payment of the balance under Clause (i) of Rs. 20-B. In the counter affidavit filed it has very fairly been stated that no mention of the application for extension of time was made in the said assessment of order under Rule 23 though an application by the petitioner was in fact, made for an extension of time on the 6th of January 1962. 8. It is also impliedly admitted that no order on that application was passed yet by notice dated the 14th February, 1962 even before the month of February had passed the petitioner was called upon to show cause as to why he should not be assessed under Rule 23 of the Rules. 8. It is also impliedly admitted that no order on that application was passed yet by notice dated the 14th February, 1962 even before the month of February had passed the petitioner was called upon to show cause as to why he should not be assessed under Rule 23 of the Rules. It is contended by the learned Standing Counsel that there was no statutory duty on the S.T.O. to entertain any such application or to pass an order thereon. Section 8 Sub-Clause (4) expressly provides :- "8 (4) The assessing authority may at any time or from time to time amend or revoke any such notice or extend the time for making any payment in pursuance of the notice". Section 8 deals with the payment and recovery of taxes and provides that the payment must be made in such a manner and in such instalments if any and within such time not being less than 15 days from the date of service of notice of assessment, as may be specified in the notice. Even assuming that the provisions of section 8(4) do not apply to an Exemption Fee Payable under Rule 20-B (i) then too it could not be seriously contended that the S.T.O. would have inherent jurisdiction to entertain an application for extension of time for the payment of Exemption Fee. The S.T.O. himself, as is clear from the counter-affidavit had said that he had the power to entertain such application for extension of time for payment and according to him he had actually waited till the middle of February, 1962 before issuing the said assessment order dated the 14th February, 1962. No justification whatsoever, has been put forward for not having passed any order on the said application which was admittedly made to the S.T.O. It was perfectly within the discretion of the S.T.O. to reject that application. But it was not open to him to ignore that application and without passing any orders to proceed to hold that there was a non-compliance and default in payment of the Exemption Fee within the period stipulated in the notice. But it was not open to him to ignore that application and without passing any orders to proceed to hold that there was a non-compliance and default in payment of the Exemption Fee within the period stipulated in the notice. It would be a travesty of justice if the S.T.O. could be allowed to ignore the application for extension of time admittedly made to him and on which he chooses not to pass any orders and which was not rejected, and yet to turn round later and say that his order had not been complied with and the assessee was in default. The discretion may be either statutory or inherent, but it has to be duly exercised and if such discretion is not exercised then this Court would have jurisdiction under Article 226 of the Constitution to compel the S.T.O. to exercise the jurisdiction vested in him. 9. In Ladhuram Taparia v. B.K. Bagchi, I.T.R. (Cal.) 51 the Calcutta High Court in a slightly different context, where an application for extension of time under Section 45 of the Income Tax Act for the payment of the demand was made but no order had been thereon and though the provisions of Section 45 gave the Income Tax Officer a discretion to treat the assess in default yet as the appeal was still undisposed of by the appellate authority. It was held that the failure to pass an express order by the Income Tax Officer on the application made for extension of time was tantamount to a failure to exercise jurisdiction vested in him as it prevented the petitioner from an opportunity of taking recourse to Section 33-A of the Income Tax Act by asking the Commissioner to exercise his powers in revision. The Income Tax Officer was in such circumstances directed not to take any steps to recover pursuant to a notice of demand, issued under Section 29 of the Income Tax Act, until the disposal of the appeal. In that case it was contended by the Advocate General that the word in Section 45 is not merely may but "may in his discretion and therefore such a discretionary power cannot under any circumstances be converted into a duty. This contention was repelled as being without force and unsupported by any authority. In that case it was contended by the Advocate General that the word in Section 45 is not merely may but "may in his discretion and therefore such a discretionary power cannot under any circumstances be converted into a duty. This contention was repelled as being without force and unsupported by any authority. It was also observed that an arbitrary exercise of jurisdiction would be no exercise of jurisdiction would be no exercise at all particularly when the S.T.O. does not even pass an order on the application made. There would in such circumstances clearly be a failure to exercise jurisdiction. In Vetcha Sreeramamurthy v. The Income Tax Officer, Vizianagram, 30 I.T.R. (1956) 252 Subba Rao, C.J., as he then was when dealing with the discretionary powers conferred by Section 45 of the Income Tax Act, observed :- "The discretionary power conferred upon the Income Tax Officer is in effect and substance one to give or not to give stay and it works both ways depending upon the manner in which it is exercised .......................... ................If the discretionary power so conferred is exercised arbitrarily capriciously or unreasonably or by taking into consideration extraneous and irrelevant consideration, in the eye of law, the authority concerned must be deemed not to have exercised the discretion at all that is he has not discharged his duty. If the Court on the facts placed before it comes to a definite conclusion that a particular authority has not exercised his duty for one or other of the aforesaid reasons it will compel the authority to discharge his duty or to put it differently to exercise his discretion honestly and objectively." 10. I am not unmindful of the fact that these decisions were given under Section 45 of the Income tax Act, but there is no reason why the ration of those cases should not be applied to the facts of the present case where there is a specific provisions under Section 8(4) of the Act for extension of time for payment of tax under the Act. Even in the absence of a specific provision under the inherent powers the failure to exercise the discretionary powers so vested. Even in the absence of a specific provision under the inherent powers the failure to exercise the discretionary powers so vested. The S.T.O. not having passed any orders on the applications for extension could not have ordinarily proceeded to make an assessment under Rule 23, as the condition precedent for the exercise the jurisdiction to proceed under the latter rule is that there must be a failure to comply within the time specified with the order demanding the Exemption Fee. As no default in the payment of Exemption fee could be said to have taken place in the absence of orders, passed on the application for extension of time, the assessments made under Rule 23 would be without jurisdiction. 11. Even if it were to be conceded for the sake of argument that there was a default and assessment could have been made under Rule 23 then too in the absence of a valid service of the notice dated the 14 the February, 1962, which was said to have been served by affixture by the peon on the 6th February 1962, the assessments would be invalid. Rule 77 provides four modes of service. It is open to the S.T.O. to effect service by any one of these modes. These are :- (a) by giving or tendering a copy thereof to the dealer or licence or his manager or agent : or (b) if such dealer or licensee or his manager or agent cannot easily be found by leaving a copy thereof at his last known place of business or residence, or by giving or tendering it to some adult member of his family ; or. (c) if the address of such dealer or licensee is known to the Sales tax Officer by sending a copy thereof to him by registered post or a copy thereof to him by registered post or (d) if none of the modes aforesaid is practicable, by affixing of a copy thereof in some conspicuous place at his last known place of business or residence". It is manifest, that service by affixations of a notice should ordinarily only be restored to if the other 3 modes of services i.e. personal service, by leaving a copy or by sending it by registered post to the last known address are not practicable. It is manifest, that service by affixations of a notice should ordinarily only be restored to if the other 3 modes of services i.e. personal service, by leaving a copy or by sending it by registered post to the last known address are not practicable. There is not a word states in the counter affidavit as to why the other three modes were not considered to be practicable before service by affixation was restored to. 12. It was contended by Mr. Raja Ram, the learned Counsel for the Department that although the counter affidavit and the affidavit of the peon who affixed the notice is that service by affixation was restored to, yet it should be treated as service under Clause (b) of Rule 77 i.e. as if a copy was left at the last known place of business or residence. There can be no warrant for treating what is in fact service by affixation as anything else. In any event, mode of service, under sub-clause (b) cannot be converted into service by affixation under Clause (d). The two modes of service are distinct and separate. Service by affixation under Rule 77 (d) has to be restored to when nobody is to be found and the premises are so to speak, lying closed whereas under Clause (b) the assumption is that some part, at least, of the premises are lying open and further that there is someone present there with whom the notice can be left, even thought such person may not himself be the dealer, assessee, manager or agent. 13. It is also a little difficult to appreciate how it can be left to the sweet will and pleasure of the peon or process server as to which mode of service he will resort to as provided in Rule 77 of the Rules. In the present case, there is no indication that any authority was sought by the peon form the Sales Tax Officer as to which mode of service should be restored to. This choice obviously cannot be left to the sweet will and pleasure of the peon. In the absence of any material on the record to show that service by affixture was restored to after the order three modes of service specified in Rule 77 were found to be impracticable, it would be difficult it not impossible to uphold the validity of such service. 14. In the absence of any material on the record to show that service by affixture was restored to after the order three modes of service specified in Rule 77 were found to be impracticable, it would be difficult it not impossible to uphold the validity of such service. 14. It was next contended by learned Standing Counsel that there was an alternate remedy open to the petitioner and therefore his Court should not exercise it writ jurisdiction. The alternative remedy suggested is the once under Section 30 of the Act which gives the S.T.O. power to set aside an ex-parte order upon being satisfied that the application did not receive the notice or was prevented by sufficient cause from appearing on the date fixed. The jurisdiction under this section is a very limited one. Further this section was only added by U.P. Sales Tax (Amendment) Act of 1959 with effect from April 1959, and therefore it is matter of some doubt as to whether it would have any application to an assessment relating to the assessment year 1957-58. In the circumstances of this case, where the very jurisdiction of the S.T.O. to make an assessment under Rule 23 is challenged because the condition precedent for invoking jurisdiction under that Rule was not satisfied no alternative remedy can be said to exist and certainly not one which can be said to be an adequate one. 15. In Calcutta Discount Co. Ltd. v. Income Tax Officer, Companies District - I Calcutta and another, 1961 I.T.R. (41) S.C. 191 which was a case under the Income Tax Act of 1922 and the validity of the notice under Section 34 (1)(a) was challenged on the ground that the condition precedent for the issue of such a notice was not satisfied. The contention raised by the counsel for the Department before their Lordships of the Supreme Court was that the question of "a non-disclosure of material facts" was not one to be investigated by the Court in an application under Article 226 of the Constitution. This contention was repelled for the reason that the condition of non-disclosure of material facts must co-exist before the Income Tax Officer could assume jurisdiction to start proceedings after the expiry of four years for action under Section 34(1)(b). It was held: "This argument that the court ought not to investigate the existence of one of these conditions viz. This contention was repelled for the reason that the condition of non-disclosure of material facts must co-exist before the Income Tax Officer could assume jurisdiction to start proceedings after the expiry of four years for action under Section 34(1)(b). It was held: "This argument that the court ought not to investigate the existence of one of these conditions viz. That the income Tax Officer had reason to believe that under assessment has resulted form non-disclosure of material facts cannot therefore, be accepted". The further contention that the Income Tax Officer contention that the Income Tax Officer when he issued the notice was not acting judicially or quasi-judicially and so a writ of Certiorari or prohibition cannot issue was also rejected. It was observed. "the High Courts have power to issue in a fit case an order prohibiting an executive authority from acting without jurisdiction. Where such action of an executive authority acting without jurisdiction subjects or is likely to subject a person to lengthy proceedings and unnecessary harassment, the High Courts it is well settled, will issue appropriate orders or directions to prevent such consequence." It was further pointed out that if the condition precedent for the assumption of jurisdiction under section 34 is not satisfied and the assessee comes to the court at the earliest opportunity, and there is nothing in his conduct which would justify the refusal of proper relief under Article 226 "it becomes the duty of the courts to give such relief in a fit case and the courts would be failing to perform their duty if relief is refused without adequate reasons. In the present case we can find no reason for which relief should be refused." In the instant case also similar contentions were raised by the learned Standing Counsel and those must be repelled for the same reasons as were given by their Lordships of the Supreme Court in the case of Calcutta Discount Company Ltd. 16. For the reasons given above, the final order of Exemption Fee dated the 18th November, 1961, would require to be modified to the extent that the Exemption Fee demanded therein shall be restricted to the maximum of Rs. 8,000/- less Rs. 18/- already deposited, leviable under the said Notification, issued under Section 4 of the Act. For the reasons given above, the final order of Exemption Fee dated the 18th November, 1961, would require to be modified to the extent that the Exemption Fee demanded therein shall be restricted to the maximum of Rs. 8,000/- less Rs. 18/- already deposited, leviable under the said Notification, issued under Section 4 of the Act. The said amount shall be deposited by the petitioner within one month from today and the security already furnished will only be released after the aforesaid payment has been duly made. The assessment order dated the 2nd March, 1962, under Rule 23 and the notice of demand dated the 17th March, 1962 will stand quashed by the issue of the writ in the nature of certiorari. 17. The petition is allowed pro tanto. In the circumstances of the case the parties are left to bear their own costs.