Assessment-based tax demand notices are invalid when issued before completion of assessment proceedings.

Demand notices under the Karnataka Sales Tax Act, 1957 were found invalid where no assessment proceedings had been completed. The High Court noted that the record showed no concluded assessment by the assessing authority and no separate statutory basis for issuing a demand notice in the absence of assessment. On that footing, the notices were quashed as illegal, with liberty reserved to issue fresh notices only after proper assessment in accordance with law.

---

---

Issues: Whether demand notices issued under the Karnataka Sales Tax Act, 1957 were valid in the absence of completed assessment proceedings.

Analysis: The petitioners challenged the notices under Article 226 of the Constitution of India on the ground that no assessment had been completed before the demand was raised. The Court found that the record disclosed no assessment proceedings concluded by the assessing authority and no other provision empowering issuance of a demand notice in the absence of assessment was shown. A demand notice issued before completion of assessment was held to be illegal.

Conclusion: The demand notices were quashed for want of assessment proceedings, though liberty was reserved to issue fresh notices after proper assessment in accordance with law.

---