Legal representative liability is limited to inherited estate, and third-party title suits remain maintainable despite tax attachment.

Liability of a legal representative under section 24B of the Income-tax Act, 1922 is confined to property actually inherited from the deceased assessee. On the facts discussed, the bank balance was not proved to be part of Gouri Shankar Goenka's estate, so attachment for his tax dues was unjustified and no personal liability could be fastened on Keshab Prasad Goenka. The text also states that section 67 does not bar a civil suit by a third party claiming that attached money belongs to her and not to the assessee's estate. The bank was treated as discharged after bona fide payment pursuant to statutory notice.

---

---

Issues: (i) Whether the amount lying in the bank account belonged to Gouri Shankar Goenka and was liable to be proceeded against for his tax dues; (ii) whether the plaintiff became the absolute owner of the amount on the death of Keshab Prasad Goenka; (iii) whether Keshab Prasad Goenka was personally liable as legal heir and representative of Gouri Shankar Goenka and whether the attachment was wrongful; (iv) whether the suit was barred by section 67 of the Income-tax Act, 1922; (v) whether the bank was discharged after payment to the income-tax authorities.

Issue (i): Whether the amount lying in the bank account belonged to Gouri Shankar Goenka and was liable to be proceeded against for his tax dues.

Analysis: The defendants relied mainly on dividend warrants and an estate duty return, but those documents did not conclusively establish that the money in the account came from Gouri Shankar Goenka or formed part of his estate. The plaintiff's evidence, together with the bank records and correspondence, supported the conclusion that the account stood in the name of Keshab Prasad Goenka and that the amounts credited were not shown to have been inherited from Gouri Shankar Goenka. The onus of proving inheritance from the deceased assessee was not discharged.

Conclusion: The issue was answered against the defendants and in favour of the plaintiff.

Issue (ii): Whether the plaintiff became the absolute owner of the amount on the death of Keshab Prasad Goenka.

Analysis: The plaintiff's case was that on the death of Keshab Prasad Goenka she acquired a widow's estate and, after the Hindu Succession Act, became absolute owner of the money standing to his credit. As the evidence showed that the account belonged to Keshab Prasad Goenka and the defendants failed to prove that the funds were inherited from Gouri Shankar Goenka, the plaintiff's succession to the amount stood established.

Conclusion: The issue was answered in favour of the plaintiff.

Issue (iii): Whether Keshab Prasad Goenka was personally liable as legal heir and representative of Gouri Shankar Goenka and whether the attachment was wrongful.

Analysis: Liability under section 24B of the Income-tax Act, 1922 was limited to the extent of the property received from the deceased. In the absence of proof that Keshab Prasad Goenka inherited any property from Gouri Shankar Goenka, no personal liability could be fastened for the latter's tax dues. The attachment of the bank money, therefore, could not be justified on the footing that it represented assets inherited from Gouri Shankar Goenka.

Conclusion: The issue was answered against the defendants and in favour of the plaintiff.

Issue (iv): Whether the suit was barred by section 67 of the Income-tax Act, 1922.

Analysis: The bar in section 67 applied to suits by an assessee to set aside or modify an assessment. The plaintiff was not the assessee and sought a declaration that the attached money belonged to her and not to the tax defaulter's estate. A third party whose property is treated by the department as belonging to an assessee is not precluded from seeking declaratory relief in civil court.

Conclusion: The suit was held not to be barred and the issue was answered in favour of the plaintiff.

Issue (v): Whether the bank was discharged after payment to the income-tax authorities.

Analysis: The bank acted on the statutory notice and made payment to the department. The plaintiff's counsel did not press the claim against the bank, and the payment was treated as having been made bona fide pursuant to the notice.

Conclusion: The bank was held to have been discharged and the issue was answered in favour of the bank.

Final Conclusion: The plaintiff succeeded on the principal questions of title, wrongful attachment, and maintainability, but no present decree was passed in her favour for want of a letter of administration, and relief was deferred until production of that document.

Ratio Decidendi: Liability of a legal representative under section 24B of the Income-tax Act, 1922 is confined to the extent of the estate inherited from the deceased, and a third party whose property is wrongly treated as the assessee's property may maintain a civil suit for a declaration of title notwithstanding section 67.

---