Recovery notice validity under sales tax law turns on correct dealer identification and clear arrears particulars; defective notice was quashed.

A recovery notice under section 13-A of the Orissa Sales Tax Act must clearly identify the defaulting dealer and state the arrears consistently with the statutory form. Although recovery action could in principle be taken for arrears attributable to a non-resident company, the notice here described the petitioner as the defaulting dealer, omitted any reference to the company, and contained inconsistent amounts in the notices and counter-affidavit. The defect meant the demand was not in conformity with the statutory requirements, so the notices were invalid and were quashed in favour of the assessee.

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Issues: Whether the notices issued under section 13-A of the Orissa Sales Tax Act for recovery of arrear tax were valid when the notices did not clearly identify the correct defaulting dealer and the amounts demanded showed material discrepancies.

Analysis: The challenge to the vires of section 13-A was not pressed. The Court accepted that recovery action under section 13-A could, in principle, be taken even against the petitioner for arrears due from the non-resident company if the statutory basis was otherwise satisfied. However, the notice served by the Assistant Sales Tax Officer described the petitioner as the defaulting dealer and mentioned only the petitioner's registration particulars, while the department later sought to justify the demand on the footing that arrears related to multiple registered entities. The statutory form required the defaulting dealer's particulars and the arrears to be stated clearly. Since the notice did not refer to the company at all and the amounts mentioned in the notices and counter-affidavit were inconsistent, the notice was found to be defective and not in conformity with the statutory requirements.

Conclusion: The notices under section 13-A were invalid and were quashed; the challenge succeeded on this issue in favour of the assessee.

Ratio Decidendi: A notice for recovery of tax arrears under section 13-A of the Orissa Sales Tax Act must accurately identify the defaulting dealer and state the arrears with clarity and consistency, failing which it is liable to be quashed.

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