Non-Service Of Assessment Orders Inconsequential If Assesee Had Knowledge About Them Otherwise : Supreme Court

Attachment orders issued by the revenue for tax arrears will not be vitiated merely because the assessment orders were not served on the assesse, if the assessee had otherwise got knowledge about the assessment orders, held the Supreme Court recently.

On this ground, the Supreme Court restored the attachment orders issued under the APGST Act and Telangana VAT Act, which were set aside by the Telangana High Court on the ground that the assessment orders were not served on the assessee.

A bench comprising Justices S Ravindra Bhat and Dipankar Datta observed that the High Court's order, under normal circumstances, would not have warranted interference, however the peculiar facts of the case forced the Court to have a second look.

In this case, there was a writ petition filed by the revenue when Canara Bank attached the assets of the assessee. The revenue had filed the writ petition claiming prior charge over the assets. In that writ petition, the assessment orders of the relevant years were produced. The assesee was a respondent in the writ petition and it contested it filing a writ petition. Therefore, the assessee obtained copy of the assessment orders, even if it is assumed that they were not served on it in the manner prescribed by the rules.

In this regard, the bench relied on the decision in Amina Bi Kaskar (D) by LRs. v. Union of India & Ors (2018) 16 SCC 266 in which it was held that if the appellants had the knowledge of the order passed against them , then so-called irregularity in the manner of effecting the service of the order on them, etc. was of no consequence and cannot be termed as illegal.

"The assessee also did not dispute that it had not received the copies of assessment orders, in those writ proceedings. Further, it did not seek copies of the assessment orders, in the representations addressed to the revenue after the second attachment order was issued, on 20.02.2018. In these circumstances, the assessee’s contentions that the attachment orders were unenforceable, because the assessment orders were not served on it, are untenable", the Court observed in this regard.

Case Title: Commercial Tax Officer Versus Neeraja Pipes Pvt. Ltd.

Citation: 2023 LiveLaw (SC) 199

Tax laws-  Non-service of assessment orders inconsequential if assesee had knowledge about them otherwise - if the appellants had the knowledge of the order passed against them , then so-called irregularity in the manner of effecting the service of the order on them, etc. was of no consequence and cannot be termed as illegal- Follows Amina Bi Kaskar (D) by LRs. v. Union of India & Ors (2018) 16 SCC 266 - Para 16,17 18

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