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Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: (i) whether tax liability of a deceased assessee can be recovered from the legal representative under Section 93 of the Central Goods and Services Tax Act, 2017; (ii) whether the assessment order passed after the assessee's death without notice, hearing, and reasons could stand in view of Section 75(4) and Section 75(6) of the Central Goods and Services Tax Act, 2017.
Issue (i): whether tax liability of a deceased assessee can be recovered from the legal representative under Section 93 of the Central Goods and Services Tax Act, 2017.
Analysis: Section 93 specifically creates liability in the hands of the legal representative where the assessee dies, including where the business has been discontinued, and permits recovery out of the estate of the deceased to the extent the estate can meet the charge.
Conclusion: The liability, if assessed in accordance with law, is recoverable from the estate of the deceased through the legal representative; the petitioner is not immune from such liability.
Issue (ii): whether the assessment order passed after the assessee's death without notice, hearing, and reasons could stand in view of Section 75(4) and Section 75(6) of the Central Goods and Services Tax Act, 2017.
Analysis: Where adverse tax liability is proposed, an opportunity of hearing must be afforded, and the order must set out relevant facts and the basis of decision. The legal heir was not independently noticed or heard before the order was passed after the assessee's death, and the order did not satisfy the statutory requirement of a reasoned determination.
Conclusion: The assessment order was unsustainable and liable to be quashed for violation of the mandatory hearing and speaking-order requirements.
Final Conclusion: The writ petitions succeeded, the impugned assessment was set aside, and the respondents were left free to proceed afresh in accordance with law against the estate of the deceased after giving due opportunity of hearing.
Ratio Decidendi: Tax liability of a deceased assessee may be fastened on the legal representative under Section 93, but any assessment against the legal representative must comply with the mandatory requirements of prior hearing and a reasoned order under Section 75.
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