- (1.) R. K. Gulati, J. The petitioner Shesh Mahal Talkies was granted a licence to run the cinema business under Section 3 of the U. P. Entertainment and Betting Tax Act, 1979 (for short "the Act" ). The cinema house of the petitioner was inspected on 14-1-1991 by the Entertainment Tax Officer, Faizabad along with the Entertain ment Tax Inspector. It is alleged that certain discrepancies were noticed on the said inspection for which a show-cause notice was issued to the petitioner. As the reply given by the petitioner was not found satisfactory, the Commissioner of Entertain ment Tax, U. R, Lucknow the second respondent by his order dated 30-3-1991 sub jected the petitioner to a penalty of Rs. 2,000 apart from demanding certain amount of entertainment tax under clause (d) of Section 12 of the Act on the al legation that the petitioner had fraudulently evaded or attempted to evade the pay ment of tax due under the Act. Feeling aggrieved, the petitioner preferred an ap peal to the State Government as contemplated under sub-section (2) of Section 12 of the Act. The appeal was, however, dismissed by the Special Secretary Finance (Entertainment Tax Department), U. P. Lucknow, the first respondent not on merit but on a technical ground for the alleged non-compliance by the petitioner of sub-rule (2) of Rule 65 of the Rules framed under the Act and known as U. P. Entertain ment and Betting Rules 1981 (hereinafter referred to as "the Rules" ). The petitioner has preferred this writ petition seeking quashing of the orders passed by the Entertainment Commissioner and the Special Secretary Finance (Entertain ment Tax Department), U. P. Lucknow, dated 30-3-1991 and 28-6-1991 respectively. The petitioner has also prayed for a writ of mandamus prohibiting the respondents not to start any recovery proceedings on the basis of the orders impugned in the writ petition.
(2.) ON behalf of the second and third respondents, namely, the Commissioner of Entertainment Tax and the Collector/district Magistrate, Ballia, a common counter-affidavit has been filed. Before noticing the contentions urged on behalf of the petitioner, the relevant provisions which have a bearing on the questions raised in the writ peti tion, may also be noticed at this stage. Section 12 (1) (d) of the Act inter alia provides that where a Commissioner or District Magistrate is satisfied that the proprietor of an entertainment has fraudulently evaded or attempted to evade the payment of tax in any manner what soever, he shall after giving the proprietor a reasonable opportunity of being heard, assess to the best of his judgment, the amount of tax due from the proprietor and also impose a penalty not exceeding to Rs. 1,000. Sub-section (2) of Section 12 of the Act confers the right of appeal to an aggrieved person. The provisions con tained in sub-section (2) of Section 12 of the Act are as under: " (2) Any person aggrieved by an order under sub-section (1) may, within fifteen days from the date of service of such order, prefer an appeal to the State Government in such manner as may be prescribed, and the order of the appellate authority shall be final. "
(3.) THE procedure and the authority to whom the appeal shall lie, is provided by Rule 65 of the Rules. As the provisions contained in that rule have an important bearing on the fate of the writ petition, the provisions are set out below which reads as under: "65. Appeals.- (1) An appeal under sub-section (3) of Section 10, sub-section (2) of Section 12, sub- section (3) of Section 15 or sub-section (4) of Section 21 of the Act shall be preferred to the Secretary to the Government of Uttar Pradesh in the Finance (Entertain ment lax) Section, U. P. , Secretariate, Lucknow along with a certified copy of the order against which the appeal is made and stating clearly the ground or grounds of appeal. A copy of the notice, if any, received, and the reply to notice, if any, given shall also be submitted. (2) A copy of the appeal alongwith its enclosures shall also be supplied simultaneous ly to the officer against where order the appeal is preferred and to the District Magistrate concerned who shall supply necessary records and such other information to the Govern ment as may be required alongwith his comments. (3) Where, on perusal of the appeal, the State Government is satisfied it may grant a temporary stay and send a copy of its order to the Commissioner as well as to the District Magistrate concerned and on receipt of such order no further action in the matter shall be taken by any of the said officers. (4) A copy of the final order passed by the Government on the appeal shall also be sent to the Commissioner and the District Magistrate concerned, and, (i) if the appeal is finally allowed by the Government and the temporary' stay granted, if any, is confirmed, all further proceedings in the matter shall be dropped; (ii) if the appeal is allowed only partially, the order under appeal shall stand amended in accordance with the orders issued by the Government and action shall be taken as per amended order; (iii) if the appeal is rejected, the temporary stay granted, if any, shall stand vacated. " As already observed, the first respondent had dismissed the appeal on the view that the petitioner had failed to comply the requirement of sub-rule (2) of Rule 65 of the Rules which require that a copy of the appeal alongwith its enclosure shall also be supplied simultaneously to the officer against whose order the appeal is preferred to the District Magistrate concerned who shall supply necessary record and such other information as may be required alongwith his comments. THE stand taken by the petitioner was that he had already forwarded a copy of the memorandum of appeal to the Commissioner of Entertainment Tax as well to the concerned District Magistrate under registered cover. THE appeal was however, dismissed on the allegations that the petitioner had not furnished a copy of the postal receipt against which the registered covers were sent to the aforesaid authorities. Learned counsel for the petitioner challenged the impugned orders on merit and also on the ground that the first respondent, the Special Secretary Finance (Entertainment Tax Department) U. P. , Lucknow, has manifestly erred in dismissing the appeal on the grounds which were not available to him inasmuch as the petitioner had already made the necessary compliance of sub-rule (2) of Rule 65 of the Rules.;