# Mahesh Gautam v. Commissioner Of Income Tax

- **Citation:** (2025) 9 ILRA 856
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2025-09-19
- **Case number:** INCOME TAX APPEAL No. 436 of 2012
- **Bench:** Saral Srivastava, Arun Kumar Singh Deshwal
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/mahesh-gautam-v-commissioner-of-income-tax-53783
- **Pages:** 12

## Headnote

Act, 1961, specifically whether the notice
sent
via
speed
post,
without
acknowledgement, can be presumed served
under S. 27 of the General Clauses Act,
1897, and whether the failure to affix the
notice at the last known address when the
appellant was not traceable vitiates the
reassessment proceedings.
9 All. Mahesh Gautam Vs. Commissioner Of Income Tax
857
Headnotes
Income Tax Act, 1961 - S. 148 read with S.
282 - Service of Notice - Distinction
between Speed Post and Registered Post -
S. 148 as well as S. 282 of the Act, 1961
clearly state that a notice through post
must be delivered to the addressee
personally, not simply to his address -
Consequently, in the absence of personal
service
on
the
assessee,
the
legal
presumption of service u/s 27 of the Act,
1897 and S. 114(f) of the Act, 1872, can
only be applied when notice is sent via
registered post, not by speed post - Speed
post
is
address-specific,
it
can
be
delivered to any person at the mentioned
address,
whereas
registered
post
is
addressee-specific.
Code of Civil Procedure, 1908 - Order V
Rule
17
-
Affixation
of
Notice
-
Untraceable Assessee - Where the Income
Tax
Inspector
reported
that
the
whereabouts of the appellant could not be
ascertained, the Assessing Officer was
required to take steps to serve the
appellant through affixture on his last
known address. In the absence of the
Assessing Officer acting on that report by
taking
steps
to
serve
the
appellant
through
affixture,
the
procedure
prescribed for service of notice under S.
282 of the Income Tax Act stood not
complied with.
General Clauses Act, 1897 - S. 27 -
Presumption of Service - Application to
Speed Post - The phrase 'registered post'
mentioned in S. 27 of the Act, 1897 cannot
be interpreted liberally for the purpose of
the income tax act - Therefore, for the
purpose of deemed service u/s 27 of the
Act, 1897 for the notice u/s 148 of the
Act,
1961,
speed
post
cannot
be
considered equivalent to registered post.
Held: In the present case, it is undisputed that
notice was sent by speed post without any
acknowledgement
rather
than
through
registered
post
which
is
a
fundamental
requirement for service of notice upon the
addressee
personally.
Consequently,
the
presumption of service u/s 27 of the Act, 1897
read with S. 114(f) of the Act, 1872 cannot be
invoked in relation to the notice sent by speed
post even if the envelope containing the notice
u/s 148 of the Act, 1961 was not returned back
- This court decides the substantial question
no.1 in favour of the appellant and concludes
that there was no service of notice u/s 148 of
the Act, 1961 through post upon the assessee
(appellant) - Regarding the substantial question
no.2 about the failure to affix the notice at the
last known address of the assessee (appellant)
especially when he was not traceable at that
address, it is relevant to mention that service
through Income Tax Officer was attempted by
the assessing officer in accordance with Part II
of S. 282(i) of the Act, 1961 - In the present
case, it is not in dispute that Income Tax Officer
did not affix notice at the assessee's address
despite the fact that assessee was not traceable
there - Therefore, service of notice through
personal service as specified by Order V Rule 17
of CPC and Part II of S. 282(i) of the Act, 1961
was not validly made - In view of the above,
present appeal is allowed and the order dated
16.11.2011 passed by Income Tax Appellate
Tribunal, Agra Bench, Agra for the A.Y. 2002-03
is hereby set-aside. (Paras 32,33,34,35,36,37)
(E-7)

Case Law Cited
Smt. Gayatri Devi v. CIT, Agra (ITA No. 11 of
2006); Milan Poddar v. CIT, Ranchi (T.A. No.
59 of 2010); CIT v. Hotline International Pvt.
Ltd. (2008) 296 ITR 333 (Del); Madan Lal
Agarwal v. CIT, Kanpur (1983) 144 ITR 745
(All); Smt. Jaswant Kaur v. ADJ, Faizabad (SCC
Revision No.154/2015).

List of Acts
Income Tax Act, 1961; Indian Evidence Act,
1872; General Clauses Act, 1897; Code of Civil
Procedure, 1908; Indi

## Text

_Characters 0–39,950 of 40,829. This is a partial read: ask again with offset=39950 for what follows._

856 INDIAN LAW REPORTS ALLAHABAD SERIES
has not considered these aspects correctly.
Contrary to the factual position, the
CEGAT has held that no plea was taken
about there being no intention to evade
payment of duty as the same was to be
reimbursed by the buyer. In fact such a plea
was clearly taken. The factual scenario
clearly goes to show that there was scope
for entertaining doubt, and taking a
particular stand which rules out application
of Section 11A of the Act.

14. As far as fraud and collusion
are concerned, it is evident that the intent to
evade duty is built into these very words. So
far as mis-statement or suppression of facts
are concerned, they are clearly qualified by
the word 'wilful', preceding the words "misstatement or suppression of facts" which
means with intent to evade duty. The next set
of words 'contravention of any of the
provisions of this Act or Rules' are again
qualified by the immediately following words
'with intent to evade payment of duty.'
Therefore, there cannot be suppression or
mis-statement of fact, which is not wilful and
yet constitute a permissible ground for the
purpose of the proviso to Section 11A. Misstatement of fact must be wilful.

19. The Apex Court has clearly stated
that incorrect statement, unless made with
the knowledge that it was not correct,
would will not be a ground of wilful
misstatement
or
suppression
and
no
inference can be drawn if full information
has been disclosed without intent to evade
payment of tax.

20. In the case in hand the authorities
have neither recorded any findings of fraud
nor wilful misstatement nor suppression of
fact to evade payment of tax, therefore, the
proceedings under section 74 of the Act out
not to have been initiated against the
petitioner.

In view of the above discussions
as well as judgment of the Apex Court and
this Court, the impugned order dated
20.12.2022 passed by the Additional
Commissioner, Grade-2 (Appeal)- II State
Tax, Agra, respondent no.1 as well as the
order dated 12.1.2022 passed by the
Deputy Commissioner, Commercial Tax,
Agra, respondent no.2 cannot be sustained
and are hereby quashed.

14. The writ petition succeeds and is
allowed.
----------
(2025) 9 ILRA 856
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 19.09.2025

BEFORE

THE HON'BLE SARAL SRIVASTAVA, J.
THE HON'BLE ARUN KUMAR SINGH
DESHWAL, J.

INCOME TAX APPEAL No. 436 of 2012

Mahesh Gautam ...Appellant
Versus
Commissioner Of Income Tax
 ...Respondent

Counsel for the Petitioner:
Rahul Agarwal

Counsel for the Respondents:
Manu Ghildiyal

Issue for Consideration
Matter pertains to the validity of the service
of notice under S. 148 of the Income Tax
Act, 1961, specifically whether the notice
sent
via
speed
post,
without
acknowledgement, can be presumed served
under S. 27 of the General Clauses Act,
1897, and whether the failure to affix the
notice at the last known address when the
appellant was not traceable vitiates the
reassessment proceedings.
9 All. Mahesh Gautam Vs. Commissioner Of Income Tax
857
Headnotes
Income Tax Act, 1961 - S. 148 read with S.
282 - Service of Notice - Distinction
between Speed Post and Registered Post -
S. 148 as well as S. 282 of the Act, 1961
clearly state that a notice through post
must be delivered to the addressee
personally, not simply to his address -
Consequently, in the absence of personal
service
on
the
assessee,
the
legal
presumption of service u/s 27 of the Act,
1897 and S. 114(f) of the Act, 1872, can
only be applied when notice is sent via
registered post, not by speed post - Speed
post
is
address-specific,
it
can
be
delivered to any person at the mentioned
address,
whereas
registered
post
is
addressee-specific.
Code of Civil Procedure, 1908 - Order V
Rule
17
-
Affixation
of
Notice
-
Untraceable Assessee - Where the Income
Tax
Inspector
reported
that
the
whereabouts of the appellant could not be
ascertained, the Assessing Officer was
required to take steps to serve the
appellant through affixture on his last
known address. In the absence of the
Assessing Officer acting on that report by
taking
steps
to
serve
the
appellant
through
affixture,
the
procedure
prescribed for service of notice under S.
282 of the Income Tax Act stood not
complied with.
General Clauses Act, 1897 - S. 27 -
Presumption of Service - Application to
Speed Post - The phrase 'registered post'
mentioned in S. 27 of the Act, 1897 cannot
be interpreted liberally for the purpose of
the income tax act - Therefore, for the
purpose of deemed service u/s 27 of the
Act, 1897 for the notice u/s 148 of the
Act,
1961,
speed
post
cannot
be
considered equivalent to registered post.
Held: In the present case, it is undisputed that
notice was sent by speed post without any
acknowledgement
rather
than
through
registered
post
which
is
a
fundamental
requirement for service of notice upon the
addressee
personally.
Consequently,
the
presumption of service u/s 27 of the Act, 1897
read with S. 114(f) of the Act, 1872 cannot be
invoked in relation to the notice sent by speed
post even if the envelope containing the notice
u/s 148 of the Act, 1961 was not returned back
- This court decides the substantial question
no.1 in favour of the appellant and concludes
that there was no service of notice u/s 148 of
the Act, 1961 through post upon the assessee
(appellant) - Regarding the substantial question
no.2 about the failure to affix the notice at the
last known address of the assessee (appellant)
especially when he was not traceable at that
address, it is relevant to mention that service
through Income Tax Officer was attempted by
the assessing officer in accordance with Part II
of S. 282(i) of the Act, 1961 - In the present
case, it is not in dispute that Income Tax Officer
did not affix notice at the assessee's address
despite the fact that assessee was not traceable
there - Therefore, service of notice through
personal service as specified by Order V Rule 17
of CPC and Part II of S. 282(i) of the Act, 1961
was not validly made - In view of the above,
present appeal is allowed and the order dated
16.11.2011 passed by Income Tax Appellate
Tribunal, Agra Bench, Agra for the A.Y. 2002-03
is hereby set-aside. (Paras 32,33,34,35,36,37)
(E-7)

Case Law Cited
Smt. Gayatri Devi v. CIT, Agra (ITA No. 11 of
2006); Milan Poddar v. CIT, Ranchi (T.A. No.
59 of 2010); CIT v. Hotline International Pvt.
Ltd. (2008) 296 ITR 333 (Del); Madan Lal
Agarwal v. CIT, Kanpur (1983) 144 ITR 745
(All); Smt. Jaswant Kaur v. ADJ, Faizabad (SCC
Revision No.154/2015).

List of Acts
Income Tax Act, 1961; Indian Evidence Act,
1872; General Clauses Act, 1897; Code of Civil
Procedure, 1908; Indian Post Office Act, 1898;
Post Office Act, 2023; Post Office Rules, 2024;
Post Office Regulations, 2024.

List of Keywords
service of notice; speed post; registered post;
affixture;
presumption;
returned
back;
reassessment proceedings; personal service;
properly addressing; not traceable; substantial
questions of law.

Case Arising From
APPELLATE JURISDICTION: Order dated
16.11.2011 of the Income Tax Appellate
Tribunal, Agra Bench, Agra for A.Y. 2002-03.
858 INDIAN LAW REPORTS ALLAHABAD SERIES
Appearances for Parties
Advs. for the Appellant:
Sri Ankur Agarwal, holding brief of Sri Rahul
Agarwal
Advs. for the Respondents:
Sri Manu Ghildiyal

(Delivered by Hon'ble Arun Kumar Singh
Deshwal, J.)

1.
Heard
Sri
Ankur
Agarwal,
Advocate, holding brief of Sri Rahul
Agarwal, learned counsel for the appellant
and Sri Manu Ghildiyal, learned counsel
for the respondents.

2. Present income tax appeal has been
filed u/s 260A of Income Tax Act, 1961
(hereinafter referred to as 'the Act, 1961')
against the order dated 16.11.2011 passed
by Income Tax Appellate Tribunal, Agra
Bench, Agra for the A.Y. 2002-03.

3. Present appeal was admitted on
27.03.2012 on the following substantial
questions of law:

"1. Whether the finding of the
Tribunal that the notice under Section 148
of the Income Tax Act had been validly
served on the appellant, by holding that the
findings recorded in the Assessment Order
and in the first appellate order were
incorrect
only
because
the
envelope
containing the unserved notice could not be
found in the original records, is perverse
and liable to be set aside?

2. Whether in view of the report
of the Inspector (sent by the Assessing
Officer to effect service of notice on the
appellant) that the whereabouts of the
appellant could not be ascertained and in
absence of the Assessing Officer acting on
that report by taking steps to serve the
appellant through affixture, etc. on his last
known address, the procedure prescribed
for service of notice under Section 282 of
the Income Tax Act stood complied with
and the Tribunal is justified in holding that
the notice was validly served on the
appellant?"

4. Appellant filed his return of income
for A.Y. 2002-03 on 23.10.2002, declaring
an income of Rs.3,90,860/-. Thereafter, on
the information received from the Central
Excise Department, the Assessing Officer,
after taking the required approval, issued
notice u/s 148 of the Act, 1961, to the
appellant for the A.Ys. 2001-02, 2002-03
and 2003-04. These notices were sent via
speed post to appellant's address, but no
return
was
filed
by
the
appellant.
Thereafter, notice u/s 142(i) of the Act,
1961 was also issued for the above
assessment years, requiring the appellant to
furnish some information and details, and a
date was fixed for hearing on 20.08.2008,
but in response to the same, neither the
appellant nor his authorized representative
appeared nor filed any application for
adjournment. Thereafter, another notice
was also sent to the appellant fixing the
date for hearing on 02.12.2008 at two
addresses available on record. Still the
appellant failed to appear before the
Assessing
Officer.
Thereafter,
the
Assessing Officer sent the Income Tax
Inspector to deliver a notice to the address
on record. However, the Income Tax
Inspector reported that the whereabouts of
the appellant could not be ascertained.
Therefore, Assessing Officer continued
with the re-assessment proceeding and
passed ex parte order u/s 147 read with
Section 144 of the Act, 1961, assessing the
total income of appellant as Rs.11,87,980/-
for the A.Y. 2003-04. This order was sent
to the appellant's address in Khandaar Swai
Madhopur, Rajasthan, which was duly
received by him.
9 All. Mahesh Gautam Vs. Commissioner Of Income Tax
859

5. The appellant filed an appeal
against the order dated 15.12.2008 passed
by Assessing Officer before Commissioner
of Income Tax (Appeal)-II, Agra which
was registered as Appeal No.CIT(A)-
II/268, 269 & 270/DCIT (CC)/AGR/08-09.
The appeal of the appellant was allowed on
the ground that the notice u/s 148 of the
Act, 1961, sent to the appellant was
returned back. Therefore, in the absence of
service of notice issued u/s 148 of the Act,
1961,
the
process
of
initiating
reassessment proceedings u/s 142 of the Act,
1961, was erroneous. However, the Income
Tax
Department
(Revenue),
feeling
aggrieved by the order passed in appeal by
the
Commissioner
of
Income
Tax,
challenged the same before the Income Tax
Tribunal, Agra Bench, Agra.

6. The Income Tax Appellate Tribunal
vide judgement dated 16.11.2011 allowed
the appeal of the Income Tax Department
(Revenue) so far as the A.Y.s 2002-03,
2003-04 are concerned and dismissed the
appeal for the A.Y. 2001-02. The reason
given by the Income Tax Tribunal for
allowing the appeal was that there was
nothing on record that notice u/s 148 of
the Act, 1961, sent to the assessee was
returned back as no envelope was
available on record. Therefore, in absence
of envelope containing the notice, it
would be presumed that notice has been
served upon the assessee in view of the
presumption u/s 114(f) of the Indian
Evidence Act, 1872 (hereinafter referred
to as 'the Act, 1872') and this fact was
ignored by the Assessing Officer as well
as the first appellate court.

7. The above order of Income Tax
Appellate Tribunal is under challenge in
the present appeal regarding the A.Y. 200304.

8. Learned counsel for the appellant
has submitted that the order passed by the
Income
Tax
Appellate
Tribunal
is
absolutely erroneous as the Assessing
Officer as well as first appellate court has
recorded specific finding that notice u/s
148 of the Act, 1961 sent through speed
post was returned back then merely
because envelope was not available on
record and same was missing, it cannot be
presumed that notice has been deemed to
be served upon the appellant by taking
presumption u/s 114(f) of the Act, 1872. It
is further submitted by learned counsel for
the appellant that the notice has to be
served as per the procedure mentioned u/s
282 of the Act, 1961 wherein the word
'post' has been mentioned which means
only 'registered post' as per Section 27 of
the General Clauses Act, 1897 (hereinafter
referred to as 'the Act, 1897'), not the speed
post. Therefore, service of notice u/s 148 of
the Act, 1961 is not sufficient upon the
appellant,
therefore,
consequential
proceeding of re-assessment is absolutely
erroneous.

9. It is also submitted by learned
counsel for the appellant that the Income
Tax Inspector sent by the Assessing Officer
submitted a report that assessee is not
traceable, therefore, unless he affixed the
notice at the last known address of the
appellant as per the procedure prescribed
u/s 282 of the Act, 1961, the service of
notice u/s 148 of the Act, 1961, cannot be
deemed to be sufficient.

10. In support of his contention,
learned counsel for the appellant has relied
upon the judgement of the Division Bench
of this court in the case of Smt. Gayatri
Devi Vs. The Commissioner of Income Tax
Agra and Another in Income Tax Appeal
No.11 of 2006 as well as judgement of
860 INDIAN LAW REPORTS ALLAHABAD SERIES
Division Bench of Jharkhand High Court in
the
case
of
Milan
Poddar
Vs.
Commissioner of Income Tax, Central
Revenue Building, Main Road, Ranchi &
Another in T.A. No.59 of 2010.

11. Per contra, learned counsel for
Revenue (income tax department) has
submitted that while deciding the appeal,
Income Tax Tribunal on perusal of record
found that there is no envelope on record
showing the notice sent to the appellant
was returned back. Therefore, finding of
assessing authority as well as first appellate
authority was contrary to record and same
was rightly set aside by the Income Tax
Tribunal in appeal. Therefore, there is no
illegality in the order passed by the Income
Tax Appellate Tribunal. In support of his
contention, learned counsel for the income
tax department has also relied upon the
Division
Bench
judgement
of
the
Jharkhand High Court in Milan Poddar's
case (supra) wherein the Division Bench of
Jharkhand High Court has observed that
speed post is also a registered post. It is
further submitted by learned counsel for the
income tax department that though income
tax officer personally visited the address
given by the appellant and submitted report
that appellant is not traceable though that
was not required because notice has already
been deemed to be served upon the
appellant as the notice sent through
registered post did not return back. It is also
submitted that the assessment order was
duly received by the appellant on the
address on which the notice u/s 148 of the
Act, 1961 was sent to the appellant.
Therefore, no substantial question of law
arises in the present case and appeal
deserves to be dismissed.

12. After hearing the submission of
learned counsel for the parties and on
perusal of record, it is clear that this fact is
not disputed that the envelope containing
the notice u/s 148 of the Act, 1961 sent to
appellant through registered post is not
available on record as on date because this
court itself perused the original record
which was produced before this court in
pursuance of order dated 15.12.2016 even
though the assessing officer as well as first
appellate authority has recorded the finding
that notice sent to the appellant has
returned back.

13. Service of notice u/s 148 of the
Act, 1961, upon the assessee is a
precondition
to
initiate
reassessment
proceedings. This being the provision of a
taxing statute, it should be construed
strictly. Section 148 of the Act, 1961 is
being quoted as under:

"148. Issue of notice where
income has escaped assessment.-1 [(1)]
Before
making
the
assessment,
reassessment
or
recomputation
under
section 147, the Assessing Officer shall
serve on the assessee a notice requiring him
to furnish within such period, as may be
specified in the notice, a return of his
income or the income of any other person
in respect of which he is assessable under
this
Act
during
the
previous
year
corresponding to the relevant assessment
year, in the prescribed form and verified in
the prescribed manner and setting forth
such other particulars as may be prescribed;
and the provisions of this Act shall, so far
as may be, apply accordingly as if such
return were a return required to be
furnished undersection 139:

[Provided that in a case-

(a) where a return has been
furnished during the period commencing on
the 1st day of October, 1991 and ending on
the 30th day of September, 2005 in
9 All. Mahesh Gautam Vs. Commissioner Of Income Tax
861
response to a notice served under this
section, and

(b) subsequently a notice has
been served under sub-section (2) of
section 143 after the expiry of twelve
months specified in the proviso to subsection (2) of section 143, as it stood
immediately before the amendment of said
sub-section by the Finance Act, 2002 (20 of
2002) but before the expiry of the time
limit for making the assessment, reassessment or recomputation as specified in
sub-section (2) of section 153, every such
notice referred to in this clause shall be
deemed to be a valid notice:

Provided further that in a case?

(a) where a return has been
furnished during the period commencing on
the 1st day of October, 1991 and ending on
the 30th day of September, 2005, in
response to a notice served under this
section, and

(b) subsequently a notice has
been served under clause (ii) of sub-section
(2) of section 143 after the expiry of twelve
months specified in the proviso to clause
(ii) of sub-section (2) of section 143, but
before the expiry of the time limit for
making the assessment, reassessment or
recomputation as specified in sub-section
(2) of section 153, every such notice
referred to in this clause shall be deemed to
be a valid notice.]

[Explanation.-For the removal of
doubts, it is hereby declared that nothing
contained in the first proviso or the second
proviso shall apply to any return which has
been furnished on or after the 1st day of
October, 2005 in response to a notice
served under this section.]

[(2) The Assessing Officer shall,
before issuing any notice under this section,
record his reasons for doing so.]"

14. So far as the contention of learned
counsel for the appellant that for service of
notice as per Section 282 of the Act, 1961,
notice should be served on the assessee
personally through, post means only the
registered post not the speed post is
concerned to decide the question, it would
be appropriate to reproduce Section 282 of
the Act, 1961 as existing at the relevant
time is being quoted as under:

"282- Service of notice generally

(1) A notice or requisition under
this Act may be served on the person
therein named either by post or as if it were
a summons issued by a court under the
Code of Civil Procedure, 1908 (5 of 1908).

(2) Any such notice or requisition
may be addressed-

(a) in the case of a firm or a
Hindu undivided family, to any member of
the firm or to the manager or any adult
member of the family;

(b) in the case of a local authority
or company, to the principal officer thereof;

(c) in the case of any other
association or body of individuals, to the
principal officer or any member thereof;

(d) in the case of any other person
(not being an individual), to the person who
manages or controls his affairs."

15. From perusal of Section 148 of the
Act, 1961, it is clear that notice has to be
served on the assessee personally and as
per Section 282 of the Act, 1961, notice
required under the Act, 1961 may be served
on a person either by post or as a summon
issued by the court under the Code of Civil
Procedure, 1908.

16. The word 'post' has not been
defined in the Act, 1961 or in the Indian
Post Office Act, 1898, the Post Office Act,
2023, the Indian Post Office Rules, 1933,
862 INDIAN LAW REPORTS ALLAHABAD SERIES
the Post Office Rules, 2024, but it has been
defined in Section 2(1)(k) of the Post
Office Regulation, 2024. As per this
definition, any system for collection,
dispatching, conveyance and delivery of
items by the postal network is 'post'.
Regulation 2(1)(k) is being reproduced as
under:

"2(1)(k). 'Post' means any system
for collection, clearance, sorting, dispatch,
conveyance, and delivery of items by the
postal network."

17. In view of the above mentioned
definition of post, registered post or speed
post, both come within the definition of
post. However the procedure of sending
and serving the summons issued by the
court under C.P.C. includes not only
sending the notice through registered post
but also personal service and in absence
thereof, affixing the notice at the house of
assessee. However, if there is no proof of
service of notice sent through post to the
addressee, then the presumption of service
of registered post can be invoked as per
Section 27 of the Act, 1897. But for
invoking the presumption of service of
notice through post upon the addressee, the
condition mentioned u/s 27 of the Act,
1897 should be fulfilled which requires a
proper address, pre-paying and posting by
registered post. Section 27 of the Act, 1897
is being mentioned as below:

"27. Meaning of service by post-
.Where any [Central Act] or Regulation
made after the commencement of this Act
authorizes or requires any document to be
served by post, whether the expression
serve or either of the expressions give or
send or any other expression is used, then,
unless a different intention appears, the
service shall be deemed to be effected by
properly
addressing,
pre-paying
and
posting
by
registered
post,
a
letter
containing the document, and, unless the
contrary is proved, to have been effected at
the time at which the letter would be
delivered in the ordinary course of post."

18. From the perusal of Section 27 of
the Act, 1897, it is clear that the meaning of
service by post has been defined as service
properly
addressing,
pre-paying
and
posting
by
registered
post,
a
letter
containing a document.

19. The term ''post'' and ''registered
post'' are relevant for the present purpose.
In
the
case
of
Milan
Poddar
Vs.
Commissioner of Income Tax (supra), the
Division Bench of Jharkhand High Court
has observed that the speed post is also a
registered post as the speed post is also
included in the generic word "post or
registered post". It is relevant to mention
here that the words 'registered post'
mentioned in Section 27 of the Act, 1897,
was interpreted by the Division Bench of
Jharkhand High Court in Milan Poddar
(supra) as per its literal meaning by
interpreting it using a liberal interpretation
and observed that registered post means the
post recorded in a register or book and even
the ordinary post for which record is
maintained will also come in the definition
of registered post. Paragraph no.18 of the
judgement of Milan Poddar (supra) is being
quoted as under:

"18. In view of the reasons
discussed above, we are of the considered
opinion that the notice under Section 282
the Act of 1961, can be sent by post
including "Ordinary post", "Registered
post" as well as "Speed-post". The post is a
generic word and its species are "Ordinary
post", "Registered post", "Speed-post" and
9 All. Mahesh Gautam Vs. Commissioner Of Income Tax
863
"Under Certificate of Posting" ete. Learned
Tribunal rightly relied upon page 102 of
"Maxwell
on
The
Interpretation
of
Statutes" (Twelfts Ed. By P.St. J. Langan),
wherein it has been stated that the
"language of the statute is generally
extended to new things which were not
known
and
could
not
have
been
contemplated when the Act was passed,
when the Act deals with a genus and the
thing
which
afterwards
comes
into
existence was a species of it." The Speed
Post is a new mode of sending post, and
therefore, this new postal mode if is not
mentioned in Statute specifically, even then
because of above reason that service by
Speed Post is included in generic word
"Post or "Registered Post".

20. The Single Judge Bench of
Allahabad High Court in S.C.C. Revision
No.154 of 2015 (Smt. Jaswant Kaur Vs.
Additional District Judge, Court No.1,
Faizabad And Ors.) also observed that
notice by speed post is no less than a notice
by registered post, as the speed post is a
quicker mode of service sent through
registered post. Therefore, the presumption
of service u/s 27 of the Act, 1897 will also
apply to the notice sent through speed post.
Relevant extract of the judgement of Smt.
Jaswant Kaur (supra) is being quoted as
under:

"In so far as the question of
sending notice is concerned, undisputedly
the envelope containing the notice was
correctly addressed and the notice was redirected to a place where the respondents
were carrying on business. Notice by speed
post is no less than a notice by registered
post for the reason that it is quicker mode
of service available in the developed urban
areas. The only distinction is that a
registered letter is handed over to the
addressee alone whereas a letter by speed
post can be received by any person present
at the address. The respondents have not
disputed the address mentioned on the
envelop, therefore, denial of presumption in
favour of the revisionist under Section 27
of the General Clauses Act is clearly
perverse."

21. The phrase 'registered post' are
mentioned in Section 27 of the Act, 1897
cannot be interpreted liberally for the
purpose of the income tax act. It is
established law that taxing statute has to be
interpreted
strictly.
Thus,
the
term
'registered post' in Section 27 of the Act,
1897 should be understood in reference to
the registered post services provided by the
Indian Postal department which were
initially covered by the Indian Post Office
Rules, 1933 (hereinafter referred to as 'the
Rules, 1933') and is now regulated under
the Indian Post Office Rules, 2024 and the
Post Office Regulations, 2024.

22. It is apropos to mention that the
Rules, 1933 were framed under the Indian
Post Office Act, 1898. However, the Indian
Post Office Act, 1898 has since been
repealed by the Post Office Act, 2023
wherein Post Office Rules 2024 and Post
Office Regulation 2024 were framed.
Nonetheless, at the time the notice was
issued in the present case in the year 2008,
the Rules, 1933 were still in effect.
Therefore,
difference
between
the
registered post service as well as speed post
service can be discussed taking into
consideration the Rules, 1933.

23. As per Rule 58 of the Rules, 1933
any letter or parcel may be registered at any
post office for transmission by post to any
other post office. The said Rule is being
quoted as under:
864 INDIAN LAW REPORTS ALLAHABAD SERIES

"58. Letters, letter cards, book
and
pattern
packets,
parcels
and
newspapers
prepaid
with
postage
at
newspaper rates of postage may be
registered
at
any
post
office
for
transmission by post to any other post
office."

24. As per Rule 60 of the Rules, 1933,
pre-payment of the postage and registration
fees is obligatory in the case of all
registered articles. The said Rule is being
quoted as under:

"60. The prepayment of the
postage and registration fees is obligatory
in the case of all registered articles."

25. As per Rule 62 of the Rules, 1933
when an article is presented for registration
at the post office then receipt shall be given
to him for posting the registered article.
The said Rule is being quoted as under:

"62. A receipt shall be given to
the person who presents an article for
registration at the post office window
during the hours prescribed for posting
registered articles."

26. However, as per the Rule 63 of
Rules, 1933, no registered article shall be
delivered to the addressee unless and
until he or his agent has signed a receipt
for it and Rule 64 of the Rules, 1933
prescribes that if sender of a registered
article wants to attach acknowledgement
of delivery of article then after signing it,
he has to pay additional postage. Rules 63
and 64 of the Rules, 1933 are being
quoted as under:

"63. No registered article shall be
delivered to the addressee unless and until
he or his agent has signed a receipt for it in
such form as the Director General shall
prescribe.

64. (1) If the sender of a
registered article pays at the time of
positing the article a fee of rupee three in
addition to the postage and registration fee,
there shall be sent to him on the delivery of
the article a form of acknowledgment
which shall be signed in ink by the
addressee or his duly authorized agent or if
the addressee refuses to so sign shall be
accompanied by statement to the effect that
the addressee or his duly authorized agent
has refused to so sign:

'Provided that no fee shall be
payable in respect of a registered "Blind
Literature"
packet
for
which
an
acknowledgement is required.

(2) No article for which an
acknowledgment is required under subrule(1) shall be accepted for registration
unless it bears the name and address of the
sender and is accompanied by a prescribed
form of acknowledgment duly filled in and
securely fastened to such article, and unless
the
article
bears
the
superscription
Acknowledgment Due on the address side."

27. Similarly, the Inland Speed Post,
which was introduced in 1986, was
mentioned in Rule 66B of the Rules, 1933.
As per Rule 66B of the the Rules, 1933,
Inland Speed Post Article may be booked
after obtaining receipt thereof at the
specified places for the delivery to certain
areas. As per Rule 66B(1) of the Rules,
1933, classes of mail which can be sent by
registered service can also be sent through
speed post service.

28. As per Rule 66B(3) of the Rules,
1933, the envelope through speed post must
bear the name and address of the sender
and also the pin code of the post offices of
serving address.
9 All. Mahesh Gautam Vs. Commissioner Of Income Tax
865

29. Similarly, as per Rule 66B(5) of
the Rules, 1933, speed post service is a
service for delivering postal articles within
stipulated time on specified city or town.
Rules 66B(1) and 66B(3) of the Rules,
1933 are being quoted as under:

"66-B
(1)INLAND
SPEED
POST SERVICE:- Inland Postal articles
may be booked, after obtaining receipts
therefore, at the places specified in column
(1) of the Schedule below and at the post
offices specified in the corresponding
entries in column (2) of the said Schedule,
for delivery under the Inland Speed Post
Service,
subject
to
the
following
conditions, namely:-

(1) Inland Speed Post Service
shall be available in respect of all classes of
mails, which can be sent by registered
service:

(3) articles for booking under this
service shall prominently bear on, the front
the superscription "INALAND SPEED
POST" and shall also bear the name and
address of the sender in addition to that of
the addresses, including the PIN codes of
the Post Offices of deliver serving the
addressee and the sender and their
telephone number , if any:"

30. From the above quoted Rules,
1933, it is clear that registered post is
addressee-specific
and
it
has
to
be
delivered to the addressee by taking a
signature. However, speed post is addressspecific, it can be delivered to any person at
the mentioned address.

31. Though, as of date, Rules, 1933
have been repealed by the Post Office
Rules, 2024, and Post Office Regulations
2024 have also been issued under the Post
Office Act, 2023. But the difference in
registered post, speed post is same as
mentioned in the Rules, 1933. It is also
relevant to mention here that now the
registered post and speed post have been
merged, and in place thereof registered
speed
post has
been
initiated
from
September 2025, but that is not relevant to
decide the controversy in the present case.

32. Section 148 as well as Section 282
of the Act, 1961 clearly state that a notice
through post must be delivered to the
addressee personally, not simply to his
address. Consequently, in the absence of
personal service on the assessee, the legal
presumption of service u/s 27 of the Act,
1897 and Section 114(f) of the Act, 1872,
can only be applied when notice is sent via
registered
post,
not
by
speed
post.
Therefore, for the purpose of deemed
service u/s 27 of the Act, 1897 for the
notice u/s 148 of the Act, 1961, speed post
cannot
be
considered
equivalent
to
registered post. It is appropriate to reiterate
that notice sent by speed post, if personally
served upon the assessee, then the same is
sufficient service as per Section 148 read
with Section 282 of the Act, 1961.
Therefore, we are respectfully disagree
with the observation of Division Bench of
Jharkhand High Court in the case of Milan
Poddar (supra).

33. The Division Bench of Delhi High
Court also considered Section 282 of the
Act, 1961 for the purpose of sending notice
u/s 148 of the Act, 1961. In the case of
Commissioner of Income Tax Vs. Hotline
International P. Ltd reported in (2008) 296
ITR 333 (Del) and after considering the
scope of sending notice through post as
well as other mode as mentioned in CPC
for sending summons, observed that for the
purpose of the Act, 1961, registered post
ought
to
be
sent
along
with
acknowledgement deed and notice has to
866 INDIAN LAW REPORTS ALLAHABAD SERIES
be served personally upon the assessee
himself or his authorised agent and
observed that merely a refusal to receive
notice by the security guard cannot be
treated as service upon the assessee. In case
of refusal by the assessee to receive notice,
it has to be affixed. Paragraph nos.22, 23,
24 and 25 of Hotline International P. Ltd
(supra), which are being quoted as under:

"22. As per Order V, rule 12 of
the Code of Civil Procedure referred to
above, wherever it is practicable, the
service has to be effected on the defendant
in person or on his agent. Admittedly, in
the present case, notice under section 148
of the Act was not tendered to the assessee
nor was the same refused at all by the
assessee. It is an admitted case of the
Revenue that when the officials of the
Income-tax Department went to serve the
notice under section 148 for the assessment
year 1995-96, the security guard informed
them that the company was closed for Holi
festival holidays. The security guard by no
stretch of imagination can be said to be the
agent of the assessee and admittedly no
notice was tendered either to the assessee
or his agent nor was the same refused either
by the assessee or his agent.

23. Under Order V, rule 17 of the
Code of Civil Procedure, the affixation can
be done only when the assessee or his agent
refuses to sign the acknowledgment or
could not be found. Here, in the present
case, no effort was made by the Income-tax
Department to serve the notice upon the
assessee, since the company of the assessee
was closed due to Holi festival holidays,
and admittedly no effort was made by the
serving officer to locate the assessee.

24. Even otherwise, as per Order
V, rule 19A of the Code of Civil Procedure,
the notice sent by registered post ought to
have been sent along with acknowledgment
due but admittedly it was not sent along
with acknowledgment due.

25. So, from the entire material
available on record we have no hesitation
in holding that there has been no valid
service of notice under section 148 of the
Act upon the assessee as the same was
neither tendered to the assessee or his
agent, nor the same was refused by either
of them."

34. The Division Bench of
Allahabad High Court in the case of Madan
Lal Agarwal Vs. Commissioner of IncomeTax, Kanpur reported in (1983) 144 ITR
745 (All) observed that issuance of valid
notice u/s 148 of the Act, 1961 is a
condition precedent for re-assessment u/s
147 of the Act, 1961 and therefore, in the
absence of valid service upon the assessee,
proceeding u/s 147 of the Act, 1961 for
reassessment cannot be initiated. Relevant
extract of Madan Lal Agarwal (supra) is
being quoted as under:

"It is now well settled, and we do
not consider it necessary to advert to
numerous authorities in this regard cited at
the Bar, that issuing of a valid notice to the
assessee under s. 148 of the I. T. Act within
the period specified under s. 149 of the Act
is a condition precedent to the validity of
any assessment to be made against such
assessee under s. 147 of the Act.
Accordingly, where no such notice has
been issued or if the notice issued is not
valid or the same has not been served on
the assessee in accordance with law, it will
not be possible to sustain the eventual
assessment made under s. 147 on the basis
of such notice. We may also take it that
where the notice Issued to an assessee is
vague, it would not be possible to rely upon
it to sustain an assessment made under s.
147 of the I. T. Act. In this regard two
9 All. Chitranshi vs. Rajnarayan
867
questions that arise for our consideration
are: (1) whether the notice dated 29th
September, 1962, issued under section 148
suffers from the vice of vagueness; and (2)
whether
the
sald
notice
can,
after
subsequently removing the vagueness, be
relied upon for sustaining an assessment
under s. 147 of the I. T. Act."

35. In the present case, it is undisputed
that notice was sent by speed post without
any acknowledgement rather than through
registered post which is a fundamental
requirement for service of notice upon the
addressee personally. Consequently, the
presumption of service u/s 27 of the Act,
1897 read with Section 114(f) of the Act,
1872 cannot be invoked in relation to the
notice sent by speed post even if the
envelope containing the notice u/s 148 of
the Act, 1961 was not returned back.
Additionally, the learned Tribunal recorded
finding that envelope having the notice so
returned is not readily traceable, without
verifying from other documents that the
envelope was actually available on record
or not, during the assessment and first
appellate proceeding, though there was
specific finding of assessing and appellate
authorities in that envelope sent through
speed post to the assessee containing notice
was returned back. Therefore, this court
decides the substantial question no.1 in
favour of the appellant and concludes that
there was no service of notice u/s 148 of
the Act, 1961 through post upon the
assessee (appellant).

36. Regarding the substantial question
no.2 about the failure to affix the notice at
the last known address of the assessee
(appellant) especially when he was not
traceable at that address, it is relevant to
mention that service through Income Tax
Officer was attempted by the assessing
officer in accordance with Part II of Section
282(i) of the Act, 1961. This is aligned
with the Order V Rule 17 of Code of Civil
Procedure, which requires affixation of
notice when personal service is not
possible. In the present case, it is not in
dispute that Income Tax Officer did not
affix notice at the assessee's address despite
the fact that assessee was not traceable
there. Therefore, service of notice through
personal service as specified by Order V
Rule 17 of CPC and Part II of Section
282(i) of the Act, 1961 was not validly
made.