Income-tax reassessment notice u/s148 issued to deceased taxpayer-jurisdictional nullity; proceedings quashed despite legal heir participation

Reassessment proceedings under the Income-tax Act were initiated by issuing a notice under s.148 in the name of a deceased assessee. The HC held the case did not fall within s.159(2)(a), and therefore proceedings commenced on a notice issued to a dead person could not be continued against the legal representatives. Section 292B could not cure this defect because a notice to a non-existent person is a jurisdictional nullity, not a mere mistake, defect, or omission conforming to the Act's intent. Participation by the legal representative did not validate the void initiation, and contrary authorities were distinguished as fact-specific. The reassessment proceedings were quashed and relief granted to the assessee's side.

---

---

Issues Involved:
1. Validity of the notice issued under Section 148 of the Income Tax Act to a deceased person.
2. Applicability of Section 292B of the Income Tax Act to cure defects in the notice.
3. Participation of legal representatives in the proceedings initiated against a deceased person.

Summary:

1. Validity of the Notice Issued Under Section 148 to a Deceased Person:
The primary issue was whether a notice issued under Section 148 of the Income Tax Act to a deceased person is valid. The petitioner argued that the notice issued to the deceased was invalid and without jurisdiction. The court noted that the notice dated 28th March 2018 was issued to the deceased, and despite being informed of the death, the respondent continued the proceedings without issuing a fresh notice to the legal representatives. The court referred to the precedent set in Chandreshbhai Jayantibhai Patel v. Income Tax Officer, which held that a notice issued to a dead person is invalid unless the legal representative submits to the jurisdiction without raising any objection. The court concluded that the notice issued to the deceased was invalid and could not be continued against the legal representatives.

2. Applicability of Section 292B to Cure Defects in the Notice:
The respondent argued that the defect in the notice could be cured under Section 292B of the Income Tax Act, which states that no notice shall be invalid merely by reason of any mistake, defect, or omission if it is in substance and effect in conformity with the intent and purpose of the Act. The court, however, held that Section 292B does not apply to a jurisdictional notice like one issued under Section 148. The court emphasized that a notice issued to a dead person cannot be considered in conformity with the intent and purpose of the Act and thus cannot be cured under Section 292B. The court cited the decision in Rasid Lala v. Income Tax Officer, which supported this view.

3. Participation of Legal Representatives in the Proceedings:
The respondent contended that the legal representative had participated in the proceedings, thereby curing the defect in the notice. The court examined the facts and found that the legal representative had merely informed the Assessing Officer about the death of the assessee and had not filed any return or participated in the proceedings. The court distinguished this case from others where legal representatives had filed returns and actively participated in the proceedings. The court concluded that merely informing the Assessing Officer of the death does not amount to participation in the proceedings.

Conclusion:
The court held that the notice issued under Section 148 to a deceased person was invalid and could not be continued against the legal representatives. The defect in the notice could not be cured under Section 292B, and the legal representative's mere intimation of the death did not constitute participation in the proceedings. Consequently, the court quashed the impugned notice and all consequential proceedings.

---