Reassessment against a dissolved LLP is unsustainable, but fresh notice may issue to the deceased partner's legal representative.

Reassessment proceedings and notices issued against a dissolved LLP that had ceased to exist could not validly continue, because action under the Income-tax Act cannot be sustained against a non-existent assessee; the impugned notices and consequential order were therefore invalidated. The text also notes that where the assessment issue survived only against the legal representative of a deceased managing partner, fresh notice under Section 148A(b) could be issued to that legal representative, with an opportunity to reply and be heard, and limitation would not bar such action on the peculiar facts described.

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Issues: (i) whether reassessment proceedings and notices issued against a dissolved LLP that was no longer in existence could continue; (ii) whether fresh notice could be issued to the legal representative of the deceased managing partner, with limitation not operating as a bar.

Issue (i): whether reassessment proceedings and notices issued against a dissolved LLP that was no longer in existence could continue.

Analysis: The LLP had been dissolved before the impugned notice under Section 148A(b) of the Income-tax Act, 1961 was issued. Proceedings taken out against an entity that had ceased to exist could not validly continue, and the defect was not curable on the facts of the case.

Conclusion: The notices and the consequential order were set aside.

Issue (ii): whether fresh notice could be issued to the legal representative of the deceased managing partner, with limitation not operating as a bar.

Analysis: Since the assessment issue survived only against the legal representative of the deceased managing partner, the Assessing Officer was permitted to proceed afresh against the legal representative. The Court also clarified that the peculiar facts would not allow limitation to defeat such fresh action.

Conclusion: Fresh notice under Section 148A(b) of the Income-tax Act, 1961 could be issued to the legal representative, with opportunity to reply and be heard.

Final Conclusion: The impugned reassessment proceedings against the dissolved LLP were invalidated, but the revenue was permitted to recommence action against the legal representative in accordance with law.

Ratio Decidendi: Reassessment proceedings initiated against a dissolved and non-existent assessee cannot be sustained, though fresh proceedings may be taken against the proper legal representative if lawfully permissible.

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