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2003 DIGILAW 1960 (MAD)

L. K. S. Gani v. The Commercial Tax Officer

2003-12-01

S.ASHOK KUMAR

body2003
Judgment :- This revision has been filed against the order of the Learned Judicial Magistrate No.1, Pondicherry made in Crl.M.P.No.4910 of 2001 in C.C.No.399 of 2000. 2. The brief facts of the case are as follows: The petitioner and the other accused were prosecuted by the Commercial Tax Officer, Pondicherry for the offence punishable under Section 27(2)(B) and 49(2)(B) of the Pondicherry General Sales Tax Act, 1967 r/w Section 200 Cr.P.C., The case of the complainant is that the partnership firm by name Deccan Agency, the first accused was carrying on sale of lottery tickets and the same was assessed for sales tax on 23.6.1986 and a demand for Rs.24,36,300/- was made and the partnership challenged the levy of tax before the first Appellate Authority and even before the Sales Tax Appellate Tribunal, Pondicherry and finally by order dated 22.6.99 the tax was reduced to Rs.1,53,834/-. Even this reduced amount of tax was not paid from the date of receipt of the notice served on the manager of the partnership firm on 22.12.1999. Even after the reminder dated 7.2.2000 no payment was made and hence the prosecution. 3. The petitioner and two others by name R.Varadharajan and S.K.Ummer filed discharge petitions to discharge them from the case, which were dismissed by the learned Judicial Magistrate No.1, Pondicherry by order dated 28..4.2003. Aggrieved over the said order, this revision has been filed. 4. The only contention of the learned counsel for the revision petitioner before this court is that the petitioner and the others were not served with notice as contemplated under Section-52 of the Pondicherry General Sales Tax Rules, 1967. It is an admitted fact that a notice was served on the manager of the partnership firm. As regards the service of notice, Rule-52 of the Pondicherry General Sales Tax Act Rules reads as follows: "52. It is an admitted fact that a notice was served on the manager of the partnership firm. As regards the service of notice, Rule-52 of the Pondicherry General Sales Tax Act Rules reads as follows: "52. Service of notices: (1) The service on a dealer of any notice, summons or order under the Act or these rules may be effected in any of the following ways, namely:- (a) by giving tendering it to such dealer or his manager or agent; or Explanation- Endorsement by a person who delivers the notice, etc., of having tendered or given it will be proof for the purpose of this sub-rule; (b) if such dealer or his manager or agent is not found, by giving or tendering it to any adult member of his family; or (c) if the address of such dealer is known to the assessing authority, by sending it to him by registered post; or (d) if none of the modes aforesaid is practicable, by affixing it in some conspicuous place at his last known place o business or residence. 2.Whether any Hindu undivided family, firm or other association of persons partitioned, dissolved or discontinued, notice, summons or orders issued under the Act or these rules may be served on any member of Hindu undivided family, any person who was a partner (not being a minor) or member of the association, as the case may be, immediately before such partition, dissolution or discontinuance." 5. As per the above mentioned Rule, service of notice on petitioners is sufficient if it is served on a dealer or manager or agent. There is no dispute that the partnership was served with the above notice as the manager of A1 partnership firm was served with the said notice. 6. In the decision reported in K.Balaarama Naidu Vs. As per the above mentioned Rule, service of notice on petitioners is sufficient if it is served on a dealer or manager or agent. There is no dispute that the partnership was served with the above notice as the manager of A1 partnership firm was served with the said notice. 6. In the decision reported in K.Balaarama Naidu Vs. State of Tamil Nadu ( 1992 (86) STC 284 ), a Division Bench of this court has held as follows: "Where a dissolved firm has to be assessed to sales tax for periods prior to its dissolution, under section 19A of the Tamil Nadu General Sales Tax Act, 1959, read with rule 52(2) of the Tamil Nadu General Sales Tax Rules, 1959, service of notice on one of the persons who was a partner at the time of dissolution is valid service so as to be binding on all persons who were partners at the time of dissolution of the firm." 7. In the decision reported in Bishwanath Lohia Vs. The Collector, Aligarh (1970 (26) STC 84), a Division Bench of the Allahabad High Court has held as follows: "The U.P. Sales Tax Act, 1948, envisages the assessment of a firm as an entity distinct from its partners. But once an assessment order has been made, the distinction between a firm as a unit and its individual partners and thereafter whenever reference is made to the firm, reference is intended to the partners comprising it. In that respect, the position reverts to what it is under the general law. Consequently, a notice of demand addressed to the firm must be considered as a demand upon the several partners of the firm to pay the tax. On the failure of the partners to comply with the notice of demand and pay the tax, they must be treated as being in default and thereupon each one of them is liable to be proceeded against for recovery of the tax. Upon the issue of a notice of demand, a debt owed by the firm comes into existence for which the partners are liable in the same manner as any other debt of the firm. Therefore the several modes of satisfying a decree for money passed against a firm are available for recovering sales tax dues of a firm, from its individual partners. Therefore the several modes of satisfying a decree for money passed against a firm are available for recovering sales tax dues of a firm, from its individual partners. These modes of recovery include the arrest and detention of the individual partners. Consequently, the sales tax authorities are competent to recover the sales tax assessed on a firm by taking recovery proceedings against the individual partners even though no separate notice of demand has been issued to them and these proceedings may include the arrest and detention of the partners in prison." From the decisions referred to above, it is clear that once a notice is served on any person, a dealer or manager or one of the partners of the firm, it is sufficient service which will be binding on all the persons in-charge of the firm. Therefore, the contention of the revision petitioner that they are not served with the notice, is not sustainable. Hence this revision has no merits and the same is liable to be dismissed. Accordingly the revision is dismissed. No costs. Consequently connected Crl.M.P. is closed.