Fresh demand notice required before recovering tax dues from legal representatives; garnishee notices to third parties were sustained.

A deceased assessee's tax liability could be enforced against legal representatives only to the extent of the estate in their hands, but recovery could not proceed unless fresh demand notices were first issued and then disobeyed. The Court therefore held that the legal representatives could not be treated as defaulters on the basis of the original demand notice alone, and fresh notice was required before recovery proceedings could continue. The garnishee notices to third parties were not interfered with because the notices had been served on the addressees, who had not challenged them, and the petitioners could not contest them on their behalf.

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Issues: (i) Whether, after the death of the assessee, recovery proceedings against his legal representatives could be continued without issuing them fresh demand notices under the Karnataka Sales Tax Act, 1957. (ii) Whether the garnishee notices issued to third parties under the Act were liable to be interfered with at the instance of the petitioners.

Issue (i): Whether, after the death of the assessee, recovery proceedings against his legal representatives could be continued without issuing them fresh demand notices under the Karnataka Sales Tax Act, 1957.

Analysis: The liability of the deceased assessee could be fastened on the legal representatives only to the extent of the estate in their hands, but that statutory liability did not dispense with the procedural requirement of making a demand on them. Default under the recovery provisions could arise only after a demand notice had been issued and not complied with. Section 16 created the substantive liability of the legal representatives, but it did not authorise continuation of recovery against them as if the original demand notice survived the death of the assessee.

Conclusion: Fresh demand notices were required before the legal representatives could be treated as defaulters and subjected to recovery proceedings; this issue was in favour of the petitioners.

Issue (ii): Whether the garnishee notices issued to third parties under the Act were liable to be interfered with at the instance of the petitioners.

Analysis: The notices issued to the garnishees related to amounts alleged to be due to the deceased assessee. The persons to whom the notices were addressed had been given an opportunity to object, but they had not challenged the notices. In such circumstances, the petitioners could not maintain the challenge to those notices on their behalf, and the notices could not be interfered with in these proceedings.

Conclusion: The garnishee notices were not liable to be interfered with; this issue was against the petitioners.

Final Conclusion: The Court held that recovery against the legal representatives could not proceed without fresh demand notices, but sustained the garnishee notices, resulting in only partial relief to the petitioners.

Ratio Decidendi: A legal representative may be made liable for the deceased assessee's tax dues only to the extent of the estate inherited, but recovery cannot be enforced against the legal representative as a defaulter unless a valid demand notice is first issued and disobeyed.

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