TaxTMI 
TaxTMI 
2026 (8) TMI 1658
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.... lethargy, negligence, mala fide intention or ulterior motive of assessee in making delay and the assessee does not stand to derive any benefit because of delay. In view of the settled legal position laid down by the Hon'ble Supreme Court in Collector, Land Acquisition Vs Mst. Katiji and others 1987 AIR 1353, 1987 2 SCC 387, wherein it has been held that the "technical considerations" should not prevail over the cause of "substantial justice", we deem it fit to condone the delay. Accordingly, the delay of 9 days in filing appeal is condoned and the appeal is taken for hearing. 3. The background facts leading to present appeal are such that the assessee-individual was "Smt. Vasantiben Manubhai Joshi" who did not file any return of AY 2011-12. The AO, on the basis of information in his possession revealing that the assessee had made investment in time deposits of Rs. 69,05,721/- with banks during the relevant year, issued notice u/s 148 dated 28.03.2018 to make assessment u/s 147. In response, the assessee did not file any return. Thereafter, the AO issued notices u/s 142(1). In response, "Shri Manubhai Joshi", husband of assessee, informed to AO vide reply dated 30.11.2018 that h....
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....e appellant craves leave to add, amend, modify or alter the above grounds of appeal at any stage of appellate proceedings. 5. The appellant humbly prays that the appeal be allowed in toto." 5. Ground No. 1 is a legal ground in which it is being claimed that the notice u/s 148 issued by Ld. AO in the name of "deceased person" and consequent assessment framed u/s 147 on the basis of such notice, is illegal and liable to be quashed. 6. At first, we may take note of certain dates which would be relevant in subsequent discussion: Date of death of assessee 24.01.2016 Date on which the AO issued notice u/s 148 28.03.2018 Date on which the Legal Heir informed to AO about death of assessee 30.11.2018 Date on which the AO passed assessment-order 12.12.2018 7. During hearing before us, the Ld. AR for assessee relied upon certain judicial precedents to contend that the notice u/s 148 dated 28.03.2018 issued by AO in the name of assessee who had already deceased on 24.01.2016, is invalid. For an immediate reference, we extract the relevant portions of a few decisions cited by Ld. AR: (i) Hon'ble Jurisdictional High Court in Bhupendra Bhikha Lal Desai....
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....deceased, continued with the reassessment proceedings against the dead person. The court further held that section 159 of the Act would not be applicable to the facts of that case, and that, even if section 159 is attracted, the notice was required to be issued in the name of the heirs of the deceased assessee. Mr. Dave submitted that the aforesaid decision would be squarely applicable to the facts of the present case and that the impugned notice dated 28.03.2018 issued under section 148 of the Act having been issued against a dead person as well as the subsequent notices issued pursuant thereto, are invalid and are, therefore, required to be quashed and set aside." XXX 24. We are of the view that the same principle as referred to above would apply even to a notice issued to a dead assessee under Section 153C of the Act. It is not in dispute that the legal heir of late Bhupendrabhai Desai had not participated in the proceedings. All that the legal heir of late Bhupendrabhai Desai did was to inform the Assessing Officer about the death of his father and requested to drop the proceedings. It is true that although the father passed away in the year 2017, yet the lega....
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.... assessment proceedings were not null and void, and at the worst, that they were defective. In this context, reliance was placed on the decision of the Federal Court in Chatturam v CIT39 holding that the jurisdiction to assess and the liability to pay tax are not conditional on the validity of the notice : the liability to pay tax is founded in the charging sections and not in the machinery provisions to determine the amount of tax. Reliance was also placed on the decision in Maharaja of Patiala v CIT (1943) 11 ITR 202 (Bom.) ("Maharaja of Patiala"). That was a case where two notices were issued after the death of the assessee in his name, requiring him to make a return of income. The notices were served upon the successor Maharaja and the assessment order was passed describing the assessee as "His Highness...late Maharaja of Patiala". The successor appealed against the assessment contending that since the notices were sent in the name of the Maharaja of Patiala and not to him as the legal representative of the Maharaja of Patiala, the assessments were illegal. The Bombay High Court held that the successor Maharaja was a legal representative of the deceased and while it would have ....
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....ted about the death of the assessee and the legal heirs failed to take any steps to cancel the PAN registration in the name of the assessee and, therefore, no fault could be found with the department. 28. In the aforesaid context, we may refer to a decision of the Madras High Court in the case of Alamelu Veerappan vs. Income Tax Officer, Non-corporate Ward-2(2), Chennai, wherein the Madras High Court held as under : "14. The issue, which falls for consideration, is as to whether the impugned notice under Section 148 of the Act issued in the name of the dead person - the said Mr.S. Veerappan is enforceable in law and the subsidiary issue being as to whether the petitioner, being the wife of the said Mr.S. Veerappan, can be compelled to participate in the proceedings and respond to the impugned notice. The fact that the said Mr.S. Veerappan died on 26.1.2010 is not in dispute. If this fact is not disputed, then the notice issued in the name of the dead person is unenforceable in the eye of law. 15. The Department seeks to justify their stand by contending that they were not intimated about the death of the assessee, that the legal heirs did not take any ste....
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.... as invalid. 20. The language employed in Section 292 of the Act is categorical and clear. The notice has to be, in substance and effect, in conformity with or according to the intent and purpose of the Act. Undoubtedly, the issue relating to limitation is not a curable defect for the Revenue to invoke Section 292B of the Act. 21. All the above reasons are fully supported by the decision in the case of Vipin Walia. In that case, the notice dated 27.3.2015 was issued under Section 148 of the Act to the assessee, who died on 14.3.2015. The validity of the said notice was put to challenge. The Income Tax Officer took a stand that since the intimation of death of the assessee on 14.3.2015 was not received by her, the notice was issued on a dead person. However, the fact regarding the death of the assessee could not be disputed by the Department. The Department continued the proceedings under Section 147/148 of the Act and at that stage, the son of the deceased approached the High Court of Delhi. The High Court of Delhi pointed out that what was sought to be done by the Income Tax Officer was to initiate proceedings under Section 147 of the Act against the deceased ass....
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....d was taken into consideration and the Court held that errors and mistakes cannot and should not nullify the proceedings, which are otherwise valid and that no prejudice had been caused, as this being the mandate of Section 292B of the Act. The decision in the case of Sky Light Hospitality LLP is clearly distinguishable on facts and it does not support the case of the Revenue." 29. Ultimately, in view of the aforesaid, the only proposition of law that is applicable in the present litigation is that a notice, be it under Section 148 of the Act or Section 153C of the Act, issued to a dead person, is unenforceable in law. If such is the legal position, the Revenue cannot contend that as they had no knowledge about the death of the assessee, they are entitled to plead that the notice is not defective. XXX 35. In view of the aforesaid discussion, we are left with no other option but to allow the present writ-application and hold that the impugned notice being invalid, the further proceedings pursuant thereto are not tenable in law. 36. In the result, this writ-application succeeds and is hereby allowed. The impugned notice as well as the order (Annexu....
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....order passed by him along with letter. The petitioner also filed the death certificate of his grandfather. 11. Learned advocate Mr. R.G. Chaudhary for the petitioner submitted that issuance of notice for reopening under section 148 of the Act is bad in law as the same is issued in name of the deceased person and therefore, the consequential assessment order, the demand raised and the penalty order are required to be quashed and set aside. In respect of his submissions reliance was placed on the decision of this Court in case of Bhupendra Bhikhalal Taxmann.com 196 and decision of Madras High Court in case of Estate of Late Rangalal Jajodia vs. Commissioner of Income Tax, Madras reported in (1971) 79 ITR 505 (SC). 12. On the other hand, learned Senior Standing Counsel Mr. Karan Sanghani for the respondent-Assessing Officer submitted that the petitioner ought to have challenged the impugned assessment order in the capacity of legal representative before the appellate authority and the petition should not be entertained. It was submitted that the Hon'ble Apex Court in case of Commissioner of Income Tax and ors vs Chhabildas Agraval reported in [2013] 357 ITR 257 h....
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....sel for the respondent on the provisions of section 2(7) and 2(29) read with sections 159 and 292B of the Act, reference may be made to the said provisions, which read as under: "Section 2(7) "assessee" means a person by whom any tax or any other sum of money is payable under this Act, and includes - (a) every person in respect of whom any proceeding under the Act has been taken for the assessment of his income or of the income of any other person in respect of which he is assessable, or of the loss sustained by him or by such other person, or of the amount of refund due to him or to such other person; (b) every person who is deemed to be an assessee under any provision of this Act; (c) every person who is deemed to be an assessee in default under any provision of this Act; "Section 2(29) "legal representative" has the meaning assigned to it in clause (11) of section 2 of the Code of Civil Procedure, 1908;" "159. Legal representatives. - (1) Where a person dies, his legal representative shall be liable to pay any sum which the deceased would have been liable to pay if he had not died, in the like manner and to the same extent as....
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....t in conformity with or according to the intent and purpose of this Act." 13. Thus, the expression "assessee" includes every person who is deemed to be an assessee under any provision of the Act. Sub-section (3) of section 159 of the Act, postulates that the legal representative of the deceased shall, for the purposes of the Act, be deemed to be an assessee. Subsection (2) of section 159 of the Act says that for the purpose of making an assessment (including an assessment, reassessment or re- computation under section 147) of the income of the deceased and for the purpose of levying any sum in the hands of the legal representative in accordance with the provisions of sub-section (1), - (a) any proceeding taken against the deceased before his death shall be deemed to have been taken against the legal representative and may be continued against the legal representative from the stage at which it stood on the date of the death of the deceased; (b) any proceeding which could have been taken against the deceased if he had survived, may be taken against the legal representative; and c) all the provisions of the Act shall apply accordingly. 14.....
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....nt case. In the relied upon cases, the legal representative, in response to the impugned notice, filed return of income and participated in the proceeding and then raised an objection to the validity of the proceeding and, therefore, the court held that this was a case of waiver and that a technical defect can be waived; whereas in this case, right from the inception the petitioner has objected to the validity of the notice and thereafter to the continuation of the proceeding and has at no point of time participated in the proceeding by filing the income tax return in response to the notice issued under section 148 of the Act. Had the petitioner responded to the notice by filing return of income, he could have been said to have participated in the proceedings, however, merely because the petitioner has informed the Assessing Officer about the death of the assessee and asked him to drop the proceedings, it cannot, by any stretch of imagination, be construed as the petitioner having participated in the proceedings." 16. The Hon'ble Supreme Court by order dated 03.09.2021 passed in Special Leave to Appeal No. 13061/2021 dismissed the SLP confirming the order passed by thi....
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....of the Act is a jurisdictional notice, and existence of a valid notice under Section 148 is a condition precedent for exercise of jurisdiction by the Assessing Officer to assess or reassess under Section 147 of the Act. The want of valid notice affects the jurisdiction of the Assessing Officer to proceed with the assessment and thus, affects the validity of the proceedings for assessment or reassessment. A notice issued under Section 148 of the Act against a dead person is invalid, unless the legal representative submits to the jurisdiction of the Assessing Officer without raising any objection." Consequently, in view of the above, a reopening notice under Section 148 of the Act, 1961 issued in the name of a deceased assessee is null and void. ALSO, NO NOTICE UNDER SECTION 148 OF THE ACT, 1961 WAS EVER ISSUED UPON THE PETITIONER DURING THE PERIOD OF LIMITATION. CONSEQUENTLY, THE PROCEEDINGS AGAINST THE PETITIONER ARE BARRED BY LIMITATION AS PER SECTION 149(1)(b) OF THE ACT, 1961. 28. Also, no notice under Section 148 of the Act, 1961 was ever issued to the petitioner during the period of limitation and simply proceedings were transferred to the PAN of the petition....
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....e to impose the tax burden upon a legal representative." THERE IS NO STATUTORY REQUIREMENT IMPOSING AN OBLIGATION UPON LEGAL HEIRS TO INTIMATE THE DEATH OF THE ASSESSEE. 32. This Court is of the view that in the absence of a statutory provision it is difficult to cast a duty upon the legal representatives to intimate the factum of death of an assessee to the income tax department. After all, there may be cases where the legal representatives are estranged from the deceased assessee or the deceased assessee may have bequeathed his entire wealth to a charity. Consequently, whether PAN record was updated or not or whether the Department was made aware by the legal representatives or not is irrelevant. In Alamelu Veerappan (supra) it has been held "nothing has been placed before this Court by the Revenue to show that there is a statutory obligation on the part of the legal representatives of the deceased assessee to immediately intimate the death of the assessee or take steps to cancel the PAN registration." 33. The judgment in Pr. Commissioner of Income Tax v. Maruti Suzuki India Limited (supra) offers no assistance to the respondents. In Pr. Commissioner of....
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....e does not come under the ambit of mistake, defect or omission. Consequently, Section 292B of the Act, 1961 does not apply to the present case. 36. In Skylight Hospitality (supra) notice was issued to Skylight Hospitality Pvt. Ltd. instead of Skylight Hospitality LLP. In that factual context, this Court had observed, "Noticeably, the appellant having received the said notice, had filed without prejudice reply/letter dated April 11, 2017. They had objected to the notice being issued in the name of the company, which had ceased to exist. However, the reading of the said letter indicates that they had understood and were aware, that the notice was for them. It was relied and dealt with by them." The Supreme Court while dismissing the SLP had also observed "In the peculiar facts of this case, we are convinced that wrong name given in the notice was merely a clerical error which could be corrected under Section 292B of the Income Tax Act." 37. In any event, Section 292B of the Act, 1961 has been held to be inapplicable viza- viz notice issued to a dead person in Rajender Kumar Sehgal (supra), Chandreshbhai Jayantibhai Patel (supra) and Alamelu Veerappan (supra). In all....
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....2BB, in our opinion precludes its application, contrary to the revenue's argument." 40. Consequently, the applicability of Section 292BB of the Act, 1961 has been held to be attracted to an assessee and not to legal representatives. CONCLUSION 41. To conclude, the arguments advanced by the respondent are no longer res integra and have been consistently rejected by different High Courts including this jurisdictional Court. In view of consistent, uniform and settled position of law, to accept the submissions of the respondent would amount to unsettling the „settled law‟. In fact, in Pr. Commissioner of Income Tax v. Maruti Suzuki India Limited (supra), the Supreme Court speaking through Hon‟ble (Dr.) Justice Dhananjaya Y. Chandrachud has succinctly observed as under:- "40. We find no reason to take a different view. There is a value which the court must abide by in promoting the interest of certainty in tax litigation. The view which has been taken by this Court in relation to the respondent for AY 2011-12 must, in our view be adopted in respect of the present appeal which relates to AY 2012-13. Not doing so will only result i....
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....to the jurisdiction of the Assessing Officer without raising any objection. 13. The learned counsel for the appellants has further placed reliance on the decision CIT v. Sumantbhai C. Munshaw [1981] 5 Taxman 27/128 ITR 142 (Gujarat)]. In Sumantbhai's case (supra), it was observed that, no hard and fast line can be drawn between a nullity and an irregularity; but this much is clear, that an irregularity is a deviation from a rule of law which does not take away the foundation or authority for the proceeding or apply to its whole operation, whereas a nullity is a proceeding that it taken without any foundation for it or is so essentially defective as to be of no avail or effect whatever or is void and incapable of being validated? 14. The learned counsel for the appellants also placed reliance on the decision Vipin Walia v. ΙΤΟ [2016] 67 taxmann.com 56/238 Taxman 1/382 ITR 19 (Delhi) /[2017) 295 CTR (Del) 505]. In Vipin Walia's case (supra), the High Court of Delhi opined that the issuance of notice to the legal representative of the deceased assessee under Section 147/148 of the Act within the period of limitation would be a plain illegalit....
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....above said notices, the legal heirs of the deceased Naringaparambail Bhaskaran/appellants herein appeared before the assessing authority. However, that by itself would not change the situation. We are of the opinion that the consent of the parties cannot confer jurisdiction to the assessing authority for initiation of an action which is otherwise illegal and 'non-est'. 21. In the light of the above discussions, we cannot agree with the view taken by the learned Single Judge that the legal heirs of the deceased assessee are estopped from taking a different stand in the writ petition, since they have appeared before the assessing authority and participated in the proceedings. Therefore, we are of the view that the initiation of proceedings against a dead person under Sections 148A(b) and 148 of the Income Tax Act are illegal and 'non-est'. The Appeal succeeds. The impugned order passed by the learned Single Judge dated 31.10.2023 in W.P(C).No.34850/2023 is hereby set aside and the Writ Petition is allowed by quashing the notices and order impugned in the writ petition." (v) Recent decision dated 20.06.2025 of ITAT, Delhi Bench in Deputy Commission....
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....al before us. 6. At the very threshold of the matter before the First Appellate Authority the assessee challenged the validity of the notice under Section 148 of the Act issued to the dead person. It is a trite law that in order to undertake proceeding in respect of deceased person the legal heir needs to be identified and notice are required to be served upon such legal heir being deemed assessee. Such notices, however, are also required to be served within the time limit. Notice to assume jurisdiction under Section 148 of the Act issued to a dead person and/or non-existent entity is a case of substantive illegality when it is not the legal obligation on the part of the legal heir to suo moto inform the department on the date of the demise of the original assessee, the father, as in the case in hand; no notice under Section 148 was validly served when he was alive or on the deemed assessee i.e. the appellant before us renders the assumption of jurisdiction invalid as was the ultimate finding of the Ld. CIT(A) particularly relying upon the judgement passed by the Hon'ble Supreme Court in the case of Pr. CIT v. Mahagun Realtors (P.) Ltd. [2022] 137 taxmann.com 91/287 Ta....
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....ed in support of the order passed by the Ld. AO. 8. On the other hand the Ld. Counsel appearing for the assessee submitted before us that admittedly the notice under Section 148 of the Act was issued in the name of the father of the appellant who was no longer alive as on the date of issuance of the notice by the Department. Having regard to this particular aspect of the matter, the Ld. Counsel Mr. S. Krishnan referred the provision of law envisaged in Sections 159(2), 159(2)(a), 159(2) (b) and 159(3) of the Act. 9. It was further contended by the Ld. Counsel that by virtue of section 159(3) of the Act the legal heir of the deceased shall be deemed to be an assessee and in that view of the matter in the event of death of a person, his legal heirs need to be identified and notice under Section 148 of the Act is required to be served on such legal heirs within the limitation period in the absence of which there would be no proper assumption of jurisdiction and the subsequent proceedings would be bad in law as was his ultimate submission before us. In this regard he has relied upon very many judgments including the judgments passed by the jurisdictional High Court in....
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....ita Kapila (supra), the Hon'ble Delhi High Court has been pleased to observe categorically that the sine qua non for acquiring jurisdiction to reopen an assessment is that such notice should be issued in the name of the correct person. This requirement of issuing notice to a correct person and not to a dead person is not merely a procedural requirement but is a condition precedent to the impugned notice being valid in law. Reliance was placed on the judgment passed by the Hon'ble Bombay High Court in the case of Sumit Balkrishna Gupta v. Asstt. CIT[2019] 103 taxmann.com 188/262 Taxman 61/414 ITR 292 (Bombay)/(2019) 2 TMI one 209. 13. We have further considered the judgment passed by the Hon'ble Madras High Court in the case of Alamelu Virappan (supra), wherein it has been further held that in the absence of statutory mandate, no responsibility could be cast upon the survivors of an assessee to intimate fact of his/her demise to the tax Department. It was held "there is no statutory requirement imposing an obligation of all legal heirs to intimate the death of the assessee" 14. The Hon'ble jurisdictional High Court in the case of Vipin Walia (supra)....
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....the AO to initiate proceeding under Section 148 of the Act against the deceased assessee for Assessment Year 2009-10. The limitation for issuance of the notice under Section 148 of the Act was 31 March 2016. However, on that particular day when the notice was issued the assessee was already dead. In that view of the matter if the Ld. AO intended to proceed under Section 147 of the Act he could have done so prior to 31 March 2016 by issuing notice to the legal heir of the deceased. Beyond that date he could not have proceeded in the matter even by issuing notice to the legal heirs of the assessee. 17. We note that the notice issued in the name of a dead person is, thus, not a valid notice. In order to undertake the proceeding in respect of a deceased person the legal heirs need to be identified and notices are required to be served upon such legal heirs being deemed assessee's, in the names and in that capacity as legal heirs of the deceased and that particular notices are required to be served within the statutory time limit prescribed, which is absent in the case in hand. As admittedly, no notice under Section 148 of the Act was served upon the original assessee when was ....
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....assessment-proceeding done by Ld. AO. 11. We have considered rival submissions of both sides and perused the case-record including the orders of lower-authorities in the light of legal provisions of section 159 and the judicial decisions cited before us. 12. The provisions to deal a situation of death of individual are prescribed in section 159 of the Act. Therefore, at first it is worthwhile to refer the provision of section 159: "159. Legal representatives. - (1) Where a person dies, his legal representative shall be liable to pay any sum which the deceased would have been liable to pay if he had not died, in the like manner and to the same extent as the deceased. (2) For the purpose of making an assessment (including an assessment, reassessment or re-computation under section 147) of the income of the deceased and for the purpose of levying any sum in the hands of the legal representative in accordance with the provisions of Sub-section (1).- (a) any proceeding taken against the deceased before his death shall be deemed to have been taken against the legal representative and may be continued against the legal representative from the stag....