Post-death GST penalty determination may proceed against legal representatives, with recovery restricted to the deceased's estate.
Section 93 of the CGST Act permits tax, interest and penalty to be determined against a legal representative after the alleged contravener's death, without requiring prior notice or commenced adjudication during that person's lifetime. Liability depends on proof of the underlying contravention and satisfaction of the statutory conditions for representative liability. Recovery under Section 93(1)(b) is limited to the deceased's estate and its ability to satisfy the charge; the representative is not treated as the wrongdoer. Fair-hearing protections, including the opportunity to contest the contravention, statutory basis and quantum, and appellate review, remain available. Section 93(1)(b) is constitutionally valid under Article 14.
Issues: (i) Whether Section 93 of the Central Goods and Services Tax Act, 2017 permits penalty proceedings against a legal representative to be commenced and determined after the death of the person alleged to have committed the contravention; (ii) Whether Section 93(1)(b) of the Central Goods and Services Tax Act, 2017 is unconstitutional under Article 14 of the Constitution of India.
Issue (i): Whether Section 93 of the Central Goods and Services Tax Act, 2017 permits penalty proceedings against a legal representative to be commenced and determined after the death of the person alleged to have committed the contravention.
Analysis: Section 93 expressly covers tax, interest and penalty determined after death. Its language does not condition post-death determination upon the issuance of a show-cause notice or commencement of adjudication during the deceased's lifetime. The substantive contravention remains to be established under the applicable penal provision; Section 93 is the mechanism for determining and enforcing the resulting liability through the legal representative. Where Section 93(1)(b) applies, recovery is confined to the deceased's estate and only to the extent the estate can meet the charge. Fair hearing requirements under Section 126(3) remain applicable.
Conclusion: Section 93 permits proceedings for determination of penalty to be commenced after death against the legal representative, subject to satisfaction of its conditions; issuance of notice during the deceased's lifetime is not a prerequisite.
Issue (ii): Whether Section 93(1)(b) of the Central Goods and Services Tax Act, 2017 is unconstitutional under Article 14 of the Constitution of India.
Analysis: Section 93(1)(b) preserves liability arising from the deceased's lifetime conduct without treating the legal representative as the wrongdoer. The provision provides a rational estate-representation mechanism, restricts recovery to estate assets, and retains adjudicatory safeguards, including an effective opportunity to contest the contravention, statutory basis and quantum. The representative's inability to personally explain the deceased's affairs cannot itself be treated as an admission, and an appellate remedy remains available.
Conclusion: Section 93(1)(b) is neither discriminatory nor manifestly arbitrary and is constitutionally valid under Article 14 of the Constitution of India.
Final Conclusion: Post-death adjudication of fiscal liability is legally sustainable under Section 93, but the factual requirements for representative liability, proof of contravention, service, quantum and the effect of the adjudication order remain open for determination in the statutory process.
Ratio Decidendi: Where a fiscal statute expressly authorises tax, interest or penalty to be determined after death and confines recovery to the deceased's estate, proceedings may be initiated against the legal representative after death without prior commencement against the deceased.