Assessment against a deceased person is invalid where the tax statute lacks express machinery for estate recovery

The Income-tax Act, 1922 was read as applying assessment machinery only to a living "assessee", because Sections 3, 22, 23, 27 and 29 all proceeded on that basis. In the absence of express language authorising an ex parte assessment under Section 23(4) against a deceased person, or recovery from the estate through the legal representative, the taxing statute could not be extended by implication. The court therefore treated the assessment on the deceased as invalid, and no notice of demand or coercive recovery could properly follow against the estate.

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Issues: Whether, under the Income-tax Act, 1922, an assessment could validly be made under Section 23(4) on a deceased person after failure to furnish a return, and whether notice of demand and coercive recovery could follow against the estate of the deceased.

Analysis: The operative provisions of the Act repeatedly used the term "assessee", meaning a living person liable to pay income-tax. The charging and assessment scheme in Sections 3, 22 and 23 contemplated assessment of the assessee's total income, while Section 27 gave a person assessed ex parte under Section 23(4) a right to seek review. Section 29 also proceeded on service of a demand notice on the assessee. The statutory language contained no express provision authorising assessment of a deceased person or recovery from the estate through the legal representative. The Court declined to strain the language of a taxing statute to supply missing machinery, holding that such liability must be created by clear legislative provision.

Conclusion: The assessment under Section 23(4) on the deceased was not legal, and the demand and recovery against the estate did not arise.

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