Form No.J(2)

IN THE HIGH COURT AT CALCUTTA

CONSTITUTIONAL WRIT JURISDICTION

APPELLATE SIDE

Present :

The Hon’ble Justice Raja Basu Chowdhury

WPA 8929 of 2025

M. M. Motors & Anr.

versus

The Senior Joint Commissioner of Revenue, Berhampore Circle,

WBGST & Ors.

For the petitioners : Mr. Ankit Kanodia

Mr. Megha Agarwal

Mr. Piyush Khaitan

Ms. Tulika Roy

Appearing as Amicus : Mr. Sudhir Kr. Mehta, Sr. Adv.

Curiae.

For the State : Mr. Anirban Ray, Ld. GP

Mr. Md. T. M. Siddiqui, Ld. AGP

Mr. Tanoy Chakraborty

Mr. Saptak Sanyal

Mr. Debraj Sahu

Heard on : 24.03.2026, 25.03.2026, 30.03.2026 &

31.03.2026

Judgment on : 13

th July, 2026

Raja Basu Chowdhury, J:

1. The present writ petition has been filed, inter alia, praying for

quashing or setting aside of the order under Section 73 of the

WBGST/CGST Act 2017 (hereinafter referred to as the “said Act”) along

with summary thereof uploaded in the form GST DRC 07 on 1

st May,

2024 in respect of the tax period 2018-2019. The matter pertains to an

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issue whether the order under Section 73 of the said Act, digitally

signed on 30

th April, 2024 which was uploaded on the subsequent date,

i.e., 1

st

May, 2024 can be said to be validly issued within the period of

limitation, having regard to the provisions contained in Section 73(10)

of the said Act.

2. To answer the above issue, it is necessary to note down the facts

leading to the filing of the instant writ petition. Pursuant to a show

cause issued under Section 73(1) of the said Act in respect of the tax

period April, 2018 to March, 2019 on 20

th

December, 2023, a final

order under Section 73(9) of the said Act, was digitally signed on 30

th

April, 2024. The same was uploaded on the portal in form DRC 07 on

1

st

May, 2024. Being aggrieved, the petitioners preferred an appeal

under the provisions of Section 107 of the said Act by making payment

of the pre-deposit as is required for maintaining such appeal. The said

appeal was disposed of on contest by varying the demand raised in

DRC 07. Consequent upon the disposal of the appeal vide order dated

28

th February, 2024, a fresh demand in form APL 04 has been issued.

The writ petitioners, in the present writ petition does not question the

merits of the appeal but has confined the challenge to the competence

of the proper officer to pass and upload the order under Section 73(9),

beyond the extended time prescribed.

3. Mr. Kanodia, learned advocate representing the petitioners by

drawing attention of this Court to the provisions of Section 73(9) of the

said Act would submit that the ordinary time period for passing an

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order under the provisions of Section 73(9) is three years from the due

date for filing return for the financial year, to which the tax has not

been paid or short paid or input tax credit wrongfully availed or

utilized. By drawing attention of this Court to the notification issued

under Section 168A of the said Act dated 31

st March, 2023 and 28

th

December, 2023, he would submit that the time period for passing

orders in respect of the financial year 2018-19 had been lastly extended

up to the 30

th April, 2024. By relying on Section 169 of the said Act and

Rule 142 of the WBGST/CGST Rules, 2017 (hereinafter referred to as

the “said Rules”), he would submit that upon an order being passed

under the provision of the said Act, the proper officer is under an

obligation to upload the same in the manner prescribed in Rule 142(5)

of the said Rules. Admittedly, in this case the order impugned was

uploaded on 1

st May, 2024 beyond the time prescribed. Having regard

thereto, the entire proceedings stand vitiated as the proper officer never

enjoys any power to pass any order beyond the time or the extended

time prescribed under Section 73(9) of the said Act. It has been still

further submitted that without service of an order on the registered tax

payer in the manner prescribed in the Act, and the said Rules, the

passing of an order by a proper officer is not complete. He has also

placed reliance on the provisions of Sections 2(1)(d), 2(1)(p), 2(1)(t),

2(1)(za) and Section 13 of the Information Technology Act, 2000 to

demonstrate the manner in which a digital signature is affixed and how

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an electronic record is transmitted, and the manner in which the time

and place of dispatch and receipt of an electronic record is determined.

4. In support of his aforesaid contention, he has relied on the

following judgments (i) Daujee Abhushan Bhandar pvt. Ltd. v. Union

of India and others, reported in (2022) 444 ITR 41 (ii)

Commissioner of Wealth Tax UP and Anr . v. Kundan Lal Behari

Lal, reported in (1975) 4 SCC 844, (iii) Mema Paul & Ors. v. Income

Tax Officer, Ward-2 & Ors., reported in MANU/MN/0072/2024 . (iv)

Gopala Trading Company v. State of Up & Anr. , being Writ Tax no.

1286 of 2025, neutral citation 2025:AHC:229995-DB. He has also

relied on an unreported judgment delivered by the Division Bench of

this Court in the case of The Assistant Commissioner of Income Tax

Circle 13(1) Kolkata v. Radhakrishna Bimalkumar Pvt. Ltd. , in

AOPT 231 of 2023 on 26

th September, 2023, and as also on a

judgement delivered by the Coordinate Bench of this Court in the case

of Messers Sreema Rice Mill v. Union of India & Ors. , in WPA

11892 of 2024. Having regard thereto, he submits that since the

adjudication order in this case was not served on the petitioners, the

same cannot be enforced specifically on the ground that for an issuance

of an order to be complete, the same not only should be signed but also

should be set in a motion for the same to be delivered to the tax payer.

5. Mr. Siddiqui, learned AGP and senior advocate on the other hand

has drawn the attention of this Court to the order passed under Section

73(9) of the said Act and would submit that the said order has in fact

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been digitally signed by the proper officer on 30

th April, 2024 at around

21:15:13 hrs. He would submit that since, in terms of the notification

issued under Section 168A of the said Act, the time to pass an order

under Section 73 for the financial year 2018-19 was extended till 30

th

April, 2024, there is no irregularity in the proper officer passing such

order and enforcing the same by uploading the same on the portal on

the following date. While referring to Section 169 of the said Act, he

would submit that the said Section deals with the manner of service of

the order(s) or notices and does not deal with the scope and effect of

passing of an order under the said Act. He further points out that the

petitioners while preferring the appeal, did not raise the aforesaid

jurisdictional issue. Though, he does not dispute the fact that the

jurisdictional issue can always be raised even at a later stage. In the

fact as above, the writ petition does not merit consideration and should

be dismissed.

6. Mr. Siddiqui has also while distinguishing the judgments relied

on by the Mr. Kanodia would submit that all the aforesaid judgments

have been delivered in relation to Income Tax Act, 1961, the same does

not relate to the provisions contained in the said Act. By placing

reliance on a judgment delivered in the case of Commissioner of

Income Tax Gujrat v. Bababhai Pitamber Das (HUF), reported in

1993 Supp (3) SCC 530, he would submit that the Judgment relied on

by the petitioners in the case of Daujee Abhushan Bhandar Pvt. Ltd.

(supra) is based on borrowing the definition of the word “issue” from the

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Chambers Dictionary. According to him, ordinarily, while interpreting

the provisions of a taxing Statute, a Court is required to interpret the

provisions of the taxing Statute by reading the same with no additions

and no subtractions, and on the grounds of legislative intendments or

otherwise. Ordinarily, no foreign interpretation is permitted to be

incorporated while interpreting a taxing Statute. In support of his

aforesaid contention reliance is placed on the judgment delivered by the

Hon’ble Supreme Court in the case of Chief Commissioner of Central

Goods and Service Tax & Ors. v. Safari Retreats Private Limited

& Ors., reported in (2025) 2 SCC 523. He would thus, submit that

though in the case of Commissioner of Wealth Tax UP and Anr.

(supra) which explains and follows the judgment delivered in the case of

Banarasi Debi v. ITO, reported in AIR 1964 SC 1742 (supra) of

having observed that the expression ‘issued’ and the expression ‘served’

are used as interchangeable terms as per the legislative practices of the

country, these words are intended to convey the same meaning,

however, having regard to the observations made in the later judgment

of R.K. Upadhyay v. Shanabhai P. Patel, reported in (1987) 3 SCC

wherein the Hon’ble Supreme Court while noticing the scheme of the

Income Tax Act 1961 (in short, the “1961 Act”) was of the view that the

‘service’ under the scheme of the new Act was not a condition precedent

to conferment of jurisdiction on the Income Tax Officer (ITO) and that

issuance of the notice by the ITO within the period of limitation was

sufficient to vest the ITO with the power to make an order of

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assessment and that the requirement of issue of notice is satisfied

when the notice is actually issued.

7. This Court had, however, taken the assistance of Mr. Mehta,

learned senior advocate, who was appointed as an amicus curie. The

amicus curiae has highlighted the scope of Section 73 and has

elucidated on the expression ‘issue’ as appearing in the sub-sections of

Section 73. He has also drawn attention of this Court to the scope of

Section 169 of the said Act which provides the manner in which service

is to be effected. Scope of Rule 142 of the said Rules has also been

highlighted. According to him, an order passed under Section 73 of the

said Act has three distinct stages (1) making of the order, (2) issuance

of the order, (3) communication of the order. All the three stages serve

different legal functions. Firstly, making of the order requires exercise

of jurisdiction by the proper officer. Secondly, issuance of the order

requires giving effect to the same by way of publication. Thirdly, once,

the order is communicated, the same may give rise to other

consequences including recovery proceeding(s). The amicus curiae has

made elaborate submissions on the legal effect of the above three

stages which is discussed in the later part of the judgment.

8. Having heard the learned advocates appearing for the respective

parties and the amicus curiae, and having considered the materials on

record, it would transpire that the order under Section 73 of the said

Act though digitally signed on 30

th

April, 2024 was infact uploaded on

1

st May, 2024. Having regard thereto, and noting that the scheme of the

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said Act provides for prescribed period of limitation in issuing an order

under Section 73 of the said Act, it has become necessary to consider

(a) whether the proper officer was competent to enforce such an order

which was served through the process of upload on the common portal

beyond the extended outer period of limitation which was issued within

the period of limitation? As ancillary questions having regard to the

scheme of the Act which I will elaborate later, it has also become

necessary to consider; (b) whether the limitation would apply to the

decision or to the act of communicating the decision, though,

ordinarily, a decision cannot be enforced without the same being

communicated? and, (c) whether for an order to be complete, does the

same required to be signed and also to be set in motion for the same to

be delivered to the tax payer? In this context, it would be relevant to

note that Section 73 and/or its various sub-sections provide for

prescribed period of limitation on different stages. To morefully

appreciate the same, Section 73 of the said Act is extracted

hereinbelow:

“Section 73. Determination of tax [, pertaining to the

period up to Financial Year 2023-24,] not paid or short

paid or erroneously refunded or input tax credit wrongly

availed or utilised for any reason other than fraud or any

willful-misstatement or suppression of facts.-

(1) Where it appears to the proper officer that any tax has not been

paid or short paid or erroneously refunded, or where input tax

credit has been wrongly availed or utilised for any reason, other

than the reason of fraud or any wilful-misstatement or

suppression of facts to evade tax, he shall serve notice on the

person chargeable with tax which has not been so paid or which

has been so short paid or to whom the refund has erroneously

been made, or who has wrongly availed or utilised input tax

credit, requiring him to show cause as to why he should not pay

the amount specified in the notice along with interest payable

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thereon under section 50 and a penalty leviable under the

provisions of this Act or the rules made thereunder.

(2) The proper officer shall issue the notice under sub-section (1) at

least three months prior to the time limit specified in sub-section

(10) for issuance of order.

(3) Where a notice has been issued for any period under sub-

section (1), the proper officer may serve a statement, containing

the details of tax not paid or short paid or erroneously refunded or

input tax credit wrongly availed or utilised for such periods other

than those covered under sub-section (1), on the person

chargeable with tax.

(4) The service of such statement shall be deemed to be service of

notice on such person under sub-section (1), subject to the

condition that the grounds relied upon for such tax periods other

than those covered under sub-section (1) are the same as are

mentioned in the earlier notice.

(5) The person chargeable with tax may, before service of notice

under subsection (1) or, as the case may be, the statement under

sub-section (3), pay the amount of tax along with interest payable

thereon under section 50 on the basis of his own ascertainment of

such tax or the tax as ascertained by the proper officer and inform

the proper officer in writing of such payment.

(6) The proper officer, on receipt of such information, shall not

serve any notice under sub-section (1) or, as the case may be, the

statement under sub-section (3), in respect of the tax so paid or

any penalty payable under the provisions of this Act or the rules

made thereunder.

(7) Where the proper officer is of the opinion that the amount paid

under sub-section (5) falls short of the amount actually payable,

he shall proceed to issue the notice as provided for in sub-section

(1) in respect of such amount which falls short of the amount

actually payable.

(8) Where any person chargeable with tax under sub-section (1) or

sub-section (3) pays the said tax along with interest payable

under section 50 within thirty days of issue of show cause notice,

no penalty shall be payable and all proceedings in respect of the

said notice shall be deemed to be concluded.

(9) The proper officer shall, after considering the representation, if

any, made by person chargeable with tax, determine the amount

of tax, interest and a penalty equivalent to ten per cent. of tax or

ten thousand rupees, whichever is higher, due from such person

and issue an order.

(10) The proper officer shall issue the order under sub-section (9)

within three years from the due date for furnishing of annual

return for the financial year to which the tax not paid or short paid

or input tax credit wrongly availed or utilised relates to or within

three years from the date of erroneous refund.

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(11) Notwithstanding anything contained in sub-section (6) or sub-

section (8), penalty under sub-section (9) shall be payable where

any amount of self-assessed tax or any amount collected as tax

has not been paid within a period of thirty days from the due date

of payment of such tax.

[(12) The provisions of this section shall be applicable for

determination of tax pertaining to the period up to Financial Year

2023-24.]

9. As would appear from the above, Section 73(1) of the said Act

provides that where it appears to the proper officer that tax has not

been paid or short paid or erroneously refunded or where input tax

credit has been wrongly availed or utilised for any reason, other than

the reason of fraud or wilful-misstatement or suppression of facts to

evade tax, he shall serve a notice on the person chargeable with tax

which has not been paid or which has been so short paid or to whom

the refund has erroneously been made, or who has wrongly availed or

utilised input tax credit, requiring him to show cause. As such having

regard to Section 73(1) of the said Act, no order under Section 73(9) of

the said Act can be passed without a show-cause. Sub-section (2) of

Section 73 of the said Act, however, casts yet another restriction. The

said sub-section provides that the proper officer shall issue the notice

at least 3 months prior to the time limit specified in sub-section (10) for

issuance of the order. In other words, even if the limitation period for

issuing an order under sub-section (9) of Section 73 has not expired

but 3 months period for issuance of such show-cause notice is not

available, the matter cannot be proceeded. As sub-section (2) makes it

obligatory to the proper officer to issue a notice under sub-section (1) at

least 3 months prior to the time limit specified in sub-section (10) for

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issuance of order. Sub-section (3) provides that the show-cause may be

substantiated by a statement containing the details of the tax and the

same having regard to sub-section (4) is to be deemed to be service of

notice under sub-section (1) subject to the condition that the grounds

relied upon for the tax period other than those covered under sub-

section (1) are the same and mentioned in the earlier notice. Sub-

section (5) of Section 73 deals with the right of the person chargeable to

tax to make payment of the tax along with interest on the basis of its

own ascertainment before service of such notice under sub-section (1)

or the statement under sub-section (3) as the case may be. In such

case, upon receipt of such payment or any such information, the

proper officer shall not proceed under sub-section (1) or in the

alternative if the proper officer is of the opinion that the amount paid

under sub-section (5) falls short of the amount actually payable, he

shall then proceed to issue a notice under sub-section (1) in respect of

the amount which falls short. Sub-section (9) deals with the obligation

of the proper officer to determine the amount of tax and penalty upon

consideration of the representation if any, on the person chargeable to

tax and to issue an order. Sub-section (10) provides that the proper

officer shall issue the order under sub-section (9) within 3 years from

the due date. None of the provisions of Section 73 of the said Act,

however, provide for the manner in which the order is required to be

served, the same is completely segregated from the stage of issuance of

the order. Section 169 of the said Act, however, identifies the manner in

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which service of an order or notice is to be made. To morefully

appreciate the same, the said section is extracted hereinbelow:

169. Service of notice in certain circumstances .—(1) Any

decision, order, summons, notice or other communication under

this Act or the rules made thereunder shall be served by any one

of the following methods, namely:—

(a) by giving or tendering it directly or by a messenger

including a courier to the addressee or the taxable person

or to his manager or authorised representative or an

advocate or a tax practitioner holding authority to appear in

the proceedings on behalf of the taxable person or to a

person regularly employed by him in connection with the

business, or to any adult member of family residing with

the taxable person; or

(b) by registered post or speed post or courier with

acknowledgement due, to the person for whom it is

intended or his authorised representative, if any, at his last

known place of business or residence; or

(c) by sending a communication to his e-mail address provided

at the time of registration or as amended from time to time;

or

(d) by making it available on the common portal; or

(e) by publication in a newspaper circulating in the locality in

which the taxable person or the person to whom it is issued

is last known to have resided, carried on business or

personally worked for gain; or

(f) if none of the modes aforesaid is practicable, by affixing it

in some conspicuous place at his last known place of

business or residence and if such mode is not practicable

for any reason, then by affixing a copy thereof on the notice

board of the office of the concerned officer or authority who

or which passed such decision or order or issued such

summons or notice.

(2) Every decision, order, summons, notice or any communication

shall be deemed to have been served on the date on which it is

tendered or published or a copy thereof is affixed in the manner

provided in sub-section (1).

(3) When such decision, order, summons, notice or any

communication is sent by registered post or speed post, it shall be

deemed to have been received by the addressee at the expiry of

the period normally taken by such post in transit unless the

contrary is proved.”

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10. While one of the mode of service is by registered or speed post

with acknowledgment due, the mode of service also includes sending a

communication to the email address provided at the time of

registration; publication in the newspaper, or making it available on the

common portal. As such, uploading on the common portal is not the

only means by which a notice and order can be served. In this context,

it may be relevant to note that Rule 142 of the said Rules which is a

rule framed in exercise of powers conferred under Section 164 of the

said Act provides for the manner in which service of notice under

Section 73 amongst other sections, shall be given electronically in Form

GST DRC 01. Sub-rule (5) of Rule 142 requires a summary of the order

issued under Section 73, amongst other sections of the said Act, to be

uploaded electronically in Form GST DRC 07, specifying the amount of

tax or interest and penalty as the case may be payable by the person

concerns, and sub-rule (6) provides that the order referred to in sub-

rule (5) shall be treated as a notice for recovery.

11. In the backdrop as aforesaid, I find that Section 73 employs the

expression “issue” in sub-sections (2), (9) and (10) thereof, while the

word “service” is used in sub-section (1) of said Section as regards

service of the show-cause notice. Though Mr. Kanodia, by placing

reliance on the aforesaid has attempted to make out a case that the

words “issue” and “service” are interchangeably used and mean one

and the same, however, I find that the legislature has used the words

“issue” and “service” distinctly having regard to the nature of its

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requirement in the various sub-sections of the Section 73 while also

providing for the manner in which such a notice and order is required

to be served as provided for in Section 169 and under Rule 142 of the

said Rules. As has been pointed out by the amicus curiae, the term

“service” and “issue” have different connotations. Ordinarily, issue of a

notice or order means to formally make it out of the authority’s hands

by signing, dating and sending the documents for dispatch and

completion of secretarial practice. However, the term “service” includes

not only issuance of an order but also the effective means taken to

deliver or communicate the same to the person intended by legally

prescribed modes. As noted above, the mode of service is provided

under Section 169 and it deals with term “service” and not the term

“issue”. The term “issue” only finds place amongst other relevant

sections in Section 73 of the said Act and not under Section 169 which

provides for the mode of service. The term “issue” has, however, not

been defined under the said Act. The term “issue” and “service” has,

however, been defined in Black’s Law Dictionary. To morefully

appreciate the same, the aforesaid expressions as defined in the above

dictionary are extracted hereinbelow:

“Issue, v. To send forth; to emit; to promulgate; as, an officer issues

orders, process issues from a court. To put into circulation; as, the

treasury issues notes. To send out, to send out officially; to deliver,

for use, or authoritatively; to go forth as authoritative or binding.

Stokes v. Paschall, Tex. Civ. App., 243 S.W. 611, 614; Blythe v.

Doheny, C.C.A. Cal., 73 F. 2d 799, 803”.

“Serve. In Scotech practice. To render a verdict or decision in favour of

a person claiming to be an heir to declare the fact of his heirship

judicially. A jury are said to serve a claimant heir, when they find

him to be heir, upon the evidence submitted to them. Bell”.

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Service of process. The service of writs, summonses, rules, etc.,

signifies the delivering to or leaving them with the party to whom or

with whom they ought to be delivered or left; and, when they are so

delivered, they are then said to have been served. Usually a copy

only is served and the original is shown. Brown”.”

12. It may be borne in mind, the said Act was enacted after repeal of

the Finance Act, 1994 and the Central Excise Act, 1944. Under Finance

Act 1994, the value of taxable services escaping assessment has been

dealt with in Section 73 of the Finance Act, 1994. The expressions used

in Section 73 of the Finance Act, 1994 to initiating the proceedings is to

serve on the assessee a notice containing all or any of the requirements

within the period of limitation provided therein, for example within five

years or six months as the case may be and the failure to serve notice

within the limitation would be treated as time barred. In Section 37(c)

of the Central Excise Act which was made applicable to the Finance

Act, 1994 also uses the expression service of decisions, orders,

summons etc. and the affixation on the notice board as the means of

service. Therefore, in the cases where correct address of the notices

were not available, in such cases notices can be pasted on the notice

board and sent at the last known address so as to keep the matter

within the jurisdiction. In the present case, under the said Act, the

legislature has departed from the previous position and has not used

the expression “serve” in Section 73(2), (9) and (10) of the said Act,

instead has used the expression “issue”. The mode of service has,

however, been shelved to a completely different section, which is

Section 169. In this context, it may be relevant to place reliance on the

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judgment delivered in the case of Banarasi Debi (supra), which dealt

with the notice issued under the Income Tax Act, 1922. In the 1922 Act

under Section 34(1)(b), the officer is obliged to serve a necessary notice

within 4 years which is very similar to the provision under the Finance

Act, 1994 and the Central Excise Act, 1994.

13. In this context, it may be noted that the Hon’ble Delhi High Court

in the case of Mayawati v. Commissioner of Income Tax and Ors.,

reported in [2010] 321 ITR 349, considering the distinction between

the term “issue of notice” and the term “service of notice” has held that

it is not necessary that a notice should be served within prescribed

period which is for the issuing of the notice.

14. I find that the amicus curie has also elucidated on the above

placed reliance on the judgment delivered by the Hon’ble Supreme

Court in the case of Delhi Development Authority v. H. C. Khurana ,

reported in (1993) 3 SCC 196. The Hon’ble Supreme Court while

considering the scope of initiating disciplinary proceedings and whether

the same requires service of a charge-sheet had by noting that the

requirement in law is satisfied if the charge-sheet is dispatched to the

employees and that if the delinquent had evaded the charge-sheet, the

same would not effect the jurisdiction, which requires issue of charge-

sheet and not service thereof. Another important aspect on which the

amicus curiae has thrown light is on Section 27 of the General Clauses

Act, 1897. The same makes the position clear, as, such section starts

with the word “unless a different intention appears”. In the case at

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hand, it may be noted that the original time limit for the proper officer

to issue an order under Section 73(10) was upto 31

st December, 2019

in terms of Section 44 of the said Act read with Rule 80 of the said

Rules. The due date was, however, extended by notification no. 9 of

2023 dated 31

st March, 2023 and notification no. 56/2023, the Central

Tax Act dated 28

th

December, 2023 issued under Section 168A of the

said Act and which ultimately provided for the time period to be extend

upto 30

th April, 2024. It is not in doubt that an order in question was

digitally signed on 30

th

April, 2024. The said order appears to have

been uploaded on the following date i.e. on 1

st

May, 2024. I find that

Mr. Kanodia, learned advocate representing the petitioners by relying

on Rule 142(5) of the said Rules has emphasized that since, the said

Rules mandates the proper officer to upload the summary of the order

passed under Section 73 in Form GST DRC 07 and since, sub-section

(2) of Section 169 of the said Act provides one of the mode of service to

be by uploading the said order, the date of service of the order in the

mode and manner prescribed under the said Act would mean the date

of the order; as according to him, service of the order under Section 73

cannot be completed without uploading the same in Form DRC 07, and

the order is deemed to have been issued on the date when service

thereof is completed. However, such contention of Mr. Kanodia, does

not appear from a plain reading of Section 73 of the said Act. When the

legislature has used a particular expression in an Act which was

introduced by repealing the Finance Act, 1994 and the Central Excise

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Act, 1944 and where in both the previous Acts, only the limitation

period was interlinked with the term “service” which has intentionally

been omitted by the legislature, the arguments advanced by ignoring

such omission, in my view, cannot be the correct interpretation of the

term “issue” and “service”. In this context, I may also note that Mr.

Kanodia placed strong reliance on the judgment delivered pertaining to

issue of notice under Section 148 of the 1961 Act. To understand the

scope of issuance of notice under Section 148 of the 1961 Act, it must

be noted that on the issuance of a notice under Section 148 of the 1961

Act, reassessment proceedings do not take place. Section 149 of the

1961 Act, however, creates a specific bar in issuing a notice unless,

such notice is within the time specified therein; while reassessment is

done under section 147 of the 1961 Act. I find that the Division Bench

of this Court while considering the scope and effect of issuance of a

notice under Section 148 of the 1961 Act, in the judgment delivered in

the case of Assistant Commissioner of Income Tax, Circle 13(1)

Kolkata (supra), while proceeding on the premise that the notice

issued under Section 148 of the 1961 Act could not have been given

effect to unless the same was communicated within the period of

limitation, has treated the notice in such case, to be barred by

limitation.

15. Similarly, in the judgment relied on by the petitioners in the case

of Daujee Abhushan Bhandar Pvt. Ltd. (supra), the Hon’ble

Allahabad High Court had considered the issuance of a notice under

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Section 148 of the 1961 Act. It is in this context that the Hon’ble

Allahabad High Court while also noting the scope and the effect of the

Information Technology Act, 2000 had noted that unless, the notice

under Section 148 of the 1961 Act is sent, mere act of digitally signing

the notice cannot be construed to be an issuance of the said notice. The

judgment relied on in the case of Banarsi Debi & Anr. (supra) which

was explained in the case of Commissioner of Wealth Tax UP & Anr.

(supra) which note that the expressions “issue” and “served” have been

used in inter-changeable terms, as the legislative practice of the

country had been to intend the use of the word ‘issued’ as served. The

above position has since been further explained in a later judgment of

the Hon’ble Supreme Court in the case of R.K. Upadhyay (supra)

wherein it has been held that a clear distinction has been made out

between issue of notice and service of notice under the 1961 Act. The

Court further went on to add that Section 149 prescribes the period of

limitation and provides that no notice under Section 148 shall be

issued after the prescribed period had lapsed. Although, Section 148(1)

makes service of notice a condition precedent, the requirement of the

notice is satisfied when the notice is actually issued, since service is

not a condition precedent for the ITO to deal with the matter but to the

making an order of assessment. To morefully appreciate the above,

paragraph 2 of the above judgment is extracted hereinbelow:

“2. The High Court has quashed the notice by accepting the assessee's

contention that the action of the Income Tax Officer was barred by

limitation prescribed by the Act. There is no dispute that the notice in

this case under Section 147(b) of the Act was issued by registered post

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on March 31, 1970, and was received by the assessee on April 3, 1970.

To the facts of the case. Section 147(b) of the Act applies. The two

relevant provisions are in Sections 148 and 149 of the Act which

provide:

148. (1) Before making the assessment, reassessment or

recomputation under Section 147, the Income Tax Officer shall serve on

the assessee a notice containing all or any of the requirements which

may be included in a notice under sub-section (2) of Section 139; and the

provisions of this Act shall, so far as may be, apply accordingly as if the

notice were a notice issued under that sub-section.

(emphasis supplied)

(2)***

149. (1) No notice under Section 148 shall be issued,

(a)***

(b) in cases falling under clause (b) of Section 147, at any time

after the expiry of four years from the end of the relevant assessment

year.

(2) The provisions of sub-section (1) as to the issue of notice shall

be subject to the provisions of Section 151.”

The High Court relied upon the decision of this Court in the case

of Banarsi Debi v. ITO [AIR 1964 SC 1742 : (1964) 7 SCR 539 : 53 ITR

100] where the validity of a notice under Section 34(1) of the Income Tax

Act, 1922 and the scope of Section 4 of the Income Tax (Amendment) Act

of 1959 by which sub-section (4) was introduced into Section 34 were

considered. The Court indicated, keeping the provisions of Section 34 in

view, that there was really no distinction between “issue” and “service

of notice”. Section 34, sub-section (1) as far as relevant provided thus:

“34. (1) If—

(a)***

(b) ... he may in cases falling under clause (a) at any time within

8 years and in cases falling under clause (&) at any time within four

years of the end of that year, serve on the assessee,... and may proceed

to assess or reassess such income....

(emphasis supplied)

Section 34 conferred jurisdiction on the Income Tax Officer to reopen an

assessment subject to service of notice within the prescribed period.

Therefore, service of notice within limitation was the foundations of

jurisdiction. The same view has been taken by this Court in J.P. Janni,

ITO v. Induprasad D. Bhatt [AIR 1964 SC 1742 : (1964) 7 SCR 539 : 72

ITR 595] as also in CIT v. Robert J. Sas [AIR 1964 SC 1742 : (1964) 7

SCR 539 : 48 ITR 177] . The High Court in our opinion went wrong in

relying upon the ratio of Banarsi Debi v. ITO [AIR 1964 SC 1742 : (1964)

7 SCR 539 : 53 ITR 100] in disposing of the case in hand. The scheme of

the 1961 Act so far as notice for reassessment is concerned is quite

different. What used to be contained in Section 34 of the 1922 Act has

been spread out into three sections, being Sections 147, 148 and 149 in

the 1961 Act. A clear distinction has been made out between “issue of

notice” and “service of notice” under the 1961 Act. Section 149

prescribes the period of limitation. It categorically prescribes that no

notice under Section 148 shall be issued after the prescribed limitation

has lapsed. Section 148(1) provides for service of notice as a condition

precedent to making the order of assessment. Once a notice is issued

within the period of limitation, jurisdiction becomes vested in the Income

Tax Officer to proceed to reassess. The mandate of Section 148(1) is that

reassessment shall not be made until there has been service. The

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requirement of issue of notice is satisfied when a notice is actually

issued. In this case, admittedly, the notice was issued within the

prescribed period of limitation as March 31, 1970, was the last day of

that period. Service under the new Act is not a condition precedent to

conferment of jurisdiction in the Income Tax Officer to deal with the

matter but it is a condition precedent to making of the order of

assessment. The High Court in our opinion lost sight of the distinction

and under a wrong basis felt bound by the judgment in Banarsi

Debi v. ITO [AIR 1964 SC 1742 : (1964) 7 SCR 539 : 53 ITR 100] . As the

Income Tax Officer had issued notice within limitations, the appeal is

allowed and the order of the High Court is vacated. The Income Tax

Officer shall now proceed to complete the assessment after complying

with the requirements of law. Since there has been no appearance on

behalf of the respondents, we make no orders for costs.”

16. The factum of issuance of a notice under Section 148 of the 1961

Act is sufficient to attract the jurisdiction, though the requirement of

Section 148 to make reassessment is to serve the notice, for which no

limitation has been provided, as has been reiterated in the case of

Mayawati (supra).

17. Independent of the above, I also find that both, the learned

advocates for the petitioners as also for the respondents have placed

much reliance on the method of authentication of an order issued

under the said Act. In this context, I note that the method of

authentication is provided in Rule 26 of the said Rules which provides

that all applications, including reply, if any, to the notices, returns

including the details of outward and inward supplies, appeals or any

other document required to be submitted under the provisions of these

rules shall be so submitted electronically with digital signature

certificate or through e-signature as specified under the provisions of

the Information Technology Act, 2000 (Act 21 of 2000), or verified by

any other mode of signature or verification as notified by the Board in

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this behalf, and sub-rule (3) of the said Rule provides that all notices,

certificates and orders under the provisions of this Chapter shall be

issued electronically by the proper officer or any other officer

authorised to issue such notices or certificates or orders, through

digital signature certificate or through e-signature as specified under

the provisions of the Information Technology Act, 2000, or verified by

any other mode of signature or verification as notified by the Board in

this behalf.

18. This apart, though by placing reliance on Section 2(1)(d), 2(1)(p),

2(1)(t), 2(1)(za) and Section 13 of the Information Technology Act, 2000,

the petitioners have attempted to borrow the provisions of the

Information Technology Act to demonstrate how service of an order is

required to be effected and when an order is deemed to be served by

relying on Section 13 thereof. I, however, find that the said Act does not

borrow the provision of Section 13 of the Information Technology Act,

2000 on the issue of service, rather, the only reference to Information

Technology Act is with regard to the authentication of an order which is

required to be done in terms of the said Act. Rule 26(3) of the said

Rules provides the manner of authentication. It is not in dispute that

the order was authenticated in the manner provided by the statute,

which is also apparent from what has been stated hereinabove. In my

view, the statutory scheme of the said Act appears to distinguish

between the act of issuing the orders under Section 73(9) and the act of

serving the order, which is provided for in Section 169 of the said Act.

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While the former conforms the completion of adjudicatory function

within the prescribed period of limitation, the latter concerns the

manner in which the order is required to be communicated. Since, the

provision of limitation has been attached to the issuance of a show-

cause notice under Section 73(1) and an order under Section 73(9) of

the said Act, without providing for limitation in the manner of service of

such order, in my view, the petitioners cannot be permitted to impeach

the order on the ground that the order though was issued within the

period of limitation was served after the statutory period for making the

orders. If the statute does not mandate for service of an order within

the period of limitation, the same cannot, in my view, be treated to be a

mandate for service of the order within the period of limitation,

especially when, the legislature while repealing the previous

amendment has moved forward and chosen to make a distinction

between the words, “issue” and “service”. The judgments relied on by

Mr. Kanodia in the case of Daujee Abhushan Bhandar Pvt. Ltd.

(supra) deals with the notice under Section 148 of the 1961 Act. While

deciding such matter, their Lordships did not consider the provisions of

the Finance Act 1994, the Central Exercise Act and the said Act.

Similar Consideration applies for the case of Kundan Lal Behari Lal

(supra) and the case of Mema Paul & Ors. (supra). The above

judgments do not assist the petitioners. Insofar as the judgment

delivered in the case of Messers Sreema Rice Mill (supra) is

concerned, the same deals with the right of a tax payer to prefer the

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appeal, upon such order being uploaded in form DRC-07. The above

judgment also does not deal with the scope of issuance of an order

under Section 73(9) or 74(9) of the said Act. Insofar as the unreported

judgment delivered by the Division Bench of this Court in the case of

The Assistant Commissioner of Income Tax Circle 13(1) Kolkata

(supra) is concerned, the said judgment dealt with the issue as to

whether the new regime for assessment or reassessment or

recomputation in respect of income escaping assessment under Section

147, by virtue of a notice issued under Section 148 of the Income Tax

Act, 1961 as substituted by the Finance Act, 2021 with effect from 1

st

April, 2021 by preceding such notice with an opportunity to the

assessee to show-cause, would apply in the facts of such case. Though

the notice in such case was signed on 31

st

March, 2021, the same was

uploaded later and as such by relying on the case of Union of India v.

Ashish Agarwal, reported in (2022) 138 taxmann.com 64 (SC) and

noting that by virtue of the above judgment of Ashish Agarwal (supra),

the Hon’ble Supreme Court had extended the time by 30 days from the

date of such judgment, held that the email dispatched on 1

st April, or

thereafter is barred by limitation. Unlike the said Act, the Income Tax

Act, 1961 as substituted by the Finance Act, 2021 provides for

limitation not only at the stage of the decision to issue the notice for

reassessment under Section 148, but also to pass an order under

Section 148(d) of the 1961 Act. The two acts are entirely different and

as rightly submitted by Mr. Siddiqui no foreign interpretation is

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permitted while interpreting a taxing statute. As it is well settled that a

judgment is an authority for what it decides and a slight variation in

facts may alter the final outcome. In any event, the distinction between

the term ‘issue’ and ‘service’ did not fall for consideration in such

judgement. I am afraid, the above judgment does not assist the

petitioners.

19. Admittedly, in this case, the order was issued within the period of

limitation, the uploading of the order on the following date, following

the issuance of the order does not render the same void or barred by

limitation. Similarly, since for the purpose of appeal, the date of service

of order is treated to be the effective date, the same does not alter the

date of making (issuance) of the order.

20. To reiterate it is also well settled that while interpreting a taxing

statute, no foreign interpretation is permitted to be incorporated as has

been held in the case of Safari Retreats Private Limited & Ors.

(supra).

21. Accordingly, the first issue is answered by holding that an order

passed within the period of limitation would be enforceable only when

the same is served. The second issue is answered by observing that the

period of limitation is confined to the issuance of the order and not on

the service thereof and lastly on the third issue, since, the act of

making an order is distinct from the act of service having regard to the

scheme of the said Act as noted above, the factum of issue cannot be

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interlinked to service for the order to be complete. Accordingly, the writ

petition fails and the same is dismissed.

22. However, before concluding, I must record a note of appreciation

on the sincere efforts and the lucid submissions of the amicus curiae

who had ably assisted the Court in delivering this judgment.

23. There shall be no order as to costs.

Urgent Photostat certified copy of this order, if applied for, be

made available to the parties upon compliance of requisite formalities.

(Raja Basu Chowdhury, J.)