TaxTMI 
TaxTMI 
2024 (7) TMI 1824
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....luding death certificate of the deceased assessee and proof of being Legal Heir, before Jurisdictional Assessing Officer? (ii) non-issuance of notice u/s 143(2) of the Act in the name of Legal Heir was on account of non-linking of Legal Heir through PAN database, for which onus was on the Legal Heir which he failed to do? (iii) without appreciating the fact that notice u/s 143(2) of the Act was duly served on the Legal Heir of the deceased assessee and Legal Heir filed the Income-tax Return in the capacity of Legal Heir of the deceased assessee and AO has clearly mentioned in Para 6 of the assessment order that order is being passed upon the Legal Heir Shri Pratikkumar Anilkumar Desai? 2. The appellant craves leaves to add, modify, amend or alter any grounds of appeal at the time of, or before, the hearing of appeal. It is prayed that the order of the CIT(A) on the above issues be set-side and that of the Assessing Officer be restored. 3. The brief facts of the case are the return of income declaring total income at Rs.75,65,300/- was E-filed by the assessee on 31.03.2018. The same was processed u/s 143(1) of the Act, accepting the total incom....
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....edings and compliance However, the present case is not that of continuity in the assessment proceedings already initiated, but that of initiation of the assessment post the death of the assessee. Under such circumstances, section 159 has no application to the facts of the case. 5.5 However, there are judicial interpretations and legal precedents that serving a notice to a deceased person is null and void as the deceased individual lacks the legal capacity to respond or participate in the proceedings. This interpretation aligns with the principle that issuing a notice to the correct person is a fundamental requirement for its validity, as highlighted in various court judgments: (i) Chandreshbhai Jayantibhai Patel v. Income-tax Officer (2019) 101 taxmann.com 362 (Gujarat). The High Court of Gujarat ruled that a notice issued under section 148 of the Income-tax Act, 1961, against a deceased person is invalid unless the legal representative submits to the jurisdiction of the Assessing Officer without raising any objection. The original assessee, 'JHP', had passed away, and the Assessing Officer issued a notice in their name to reopen the assessment. The petiti....
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....ready passed away. Despite being aware of this fact, the Assessing Officer issued a notice in the name of the deceased person to reopen the assessment. The assessee filed a petition contending that the notice was without jurisdiction as it was issued against a dead person. The High Court held that no valid notice could be issued against a dead person and ordered the quashing of the impugned notice. The Supreme Court dismissed the Special Leave Petition filed against the High Court's order. 5.6 From the above decisions, it can be inferred that: (i) Notice issued on a deceased person is null and void: The courts held that a notice issued to a deceased person lacks legal validity. The death of the assessee renders any notice addressed to them void ab initio, as they no longer possess the legal capacity to respond or participate in the proceedings. (ii) Notice must be served to the correct person: The court reiterated that serving a notice to the correct person is not a mere procedural requirement but an essential condition for the validity of a notice. This requirement ensures that the intended recipient has an opportunity to respond and defend their case. (iii) ....
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....ent order on the legal representative of the deceased assessee. 6. In response, the Counsel for the assessee placed reliance on various judicial precedents and submitted that the notice is per se void ab-initio, since the Department was well aware of the fact that the assessee was deceased and even in the Income Tax Return filed by the assessee, the assessee has specifically mentioned that the return for the impugned period was being filed by the legal heir of the assessee. The Counsel for the assessee submitted that the assessee had expired on 10.09.2016, which was much prior to the initiation of assessment proceedings and, it is well settled law that once the Department has been duly intimated that the assessee had since expired, then no assessment proceedings can be validly initiated and no notice can be issued in the name of the deceased assessee. In the instant case, it is evident from the return of income itself that the assessee had expired and the said return was filed by the legal heir of the assessee. Accordingly, the notice itself is void ab-initio and hence the assessment is liable to be set aside. The Counsel for the assessee drew our attention to Page 17 of the App....
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.... The request of the assessee was accepted by the respondent-revenue. Subsequently, the impugned notice was issued by Assessing Officer in the name of deceased "B" under section 143(2). The assessee by his letter called upon the Assessing Officer to withdraw the impugned notice issued under section 143(3) as it had been issued in the name of the dead person. By the aforesaid communication, Department was informed that the Revenue was aware about the death of 'R' as was evident from the assessment orders passed for the assessment year 2014-15. Thus, the impugned notice was null and void and no further proceeding could be taken on the basis of the said notice. However, the assessing officer rejected the assessee's objection to the impugned notice having been issued in the name of the dead person on the ground that the nature of the defect viz. issue of notice in case of wrong person stood cured by section 292B and that the legal heir of the deceased was not registered with the database of the Department, thus, the is no fault in having issued the notice in the name of the deceased 'B'. 9. On these facts, the High Court while deciding the issue in favour of the a....
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....rong person is not a procedural and/or clerical error. Therefore, being a substantive defect, the notice cannot be saved by section 292B of the Act. [Para 8] In the above view, the impugned notice is quashed. Petition allowed. [Para 9] 10. In the case of Savita Kapila vs. ACIT 118 taxmann.com 46 (Delhi), the High Court held that in absence of a statutory provision, a duty cannot be cast upon legal representatives to intimate factum of death of assessee to department and, thus, where Assessing Officer issued a notice to assessee under section 148 after his death and, in such a case, it could not have been validly served upon assessee, said notice being invalid, was to be quashed. 11. In the case of Abdulvahed A. Sheikh vs. ITO in ITA No. 2948/Ahd/2017, the ITAT Ahmedabad considered various decisions on this issue rendered by the Jurisdictional Gujarat High Court while deciding this issue in favour of the assessee and made the following notable observations: "11. The issue thereafter came up before the Hon'ble High Court in the case of Jaydeepkumar Dhirajlal Thakkar vs. ITO reported in 401 ITR 302 (Guj), judgment dated 22.01.2018, wherein relying upon the ....
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....cts and circumstances of the case, section 159 of the Act would not be of any assistance to the revenue and, accordingly, set aside the impugned notice issued under section 148 of the Act. 9. The facts of the present case are similar to the facts of that case, inasmuch as the original assessee viz. father of the petitioner passed away on 19.08.2012. The petitioner had informed the revenue authorities about the same in the year 2013. The authorities were very well aware that the petitioner is the heir and legal representative of the deceased assessee, despite which, more than four years after the death of the assessee, the impugned notice has been issued in his name, namely against the deceased assessee. The above decision would be therefore squarely applicable to the present case. 10. On behalf of the respondent, reliance was placed upon section 159 and section 292B read with section 292BB of the Act. Insofar as the provisions of section 159 of the Act are concerned, this court in the above decision has held that the same would not be applicable where the assessee had passed away and the notice has not been issued in favour of the heir of the deceased. On a plain ....
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.... 12. The matter again came up for consideration before the Hon'ble High Court in the case of Chandreshbhai Jayantibhai Patel vs. ITO where the aforesaid position of law was reiterated vide judgment dated 10.12.2018 reported in [2019] 413 ITR 276(Guj). The Hon'ble High Court passed a detailed judgment taking note of the various provisions of law defining the term assessee u/s. 2(7) of the Act, the term legal representative u/s. 2(29) of the Act, the provisions applicable to legal representatives u/s. 159 of the Act and the provisions of Section 292B/BB of the Act relating to return of income etc. not to be invalid on certain grounds and notice deemed to be valid in certain circumstances. Taking note of the above, the Hon'ble High Court held that the legal representatives of the deceased assessee are to be deemed as assessee's and as per the provisions of Section 159 where the assessee had expired prior to the issue of notice u/s 148 of the Act then the proceedings had to be taken against the legal representative/s as per Section 159(2)(b) of the Act, meaning thereby that in pursuance to notice issued u/s. 148 of the Act to a dead person, proceedings cannot b....
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.... death of his father and requesting him to drop the proceedings. The attention of the Income Tax Officer was further invited to the provisions of section 159 of the Act, to submit that the proceedings are required to be initiated against a legal representative and not against the deceased and, therefore, the notices issued to the dead person are invalid. Reliance was placed upon the decision of this court in Jaydeep Kumar Dhirajlal Thakkar v. Income Tax Officer, (2018) 401 ITR 302 (Guj.) and Vipin Walia v. Income Tax Officer, (2016) 381 ITR 19 (Delhi). 9. Thereafter, by a notice dated 03.08.2018 issued under section 142(1) of the Act, the respondent called upon the petitioner as legal heir of deceased Shri Jayantilal Harilal Patel to furnish the documents mentioned therein. In the annexure thereto, the petitioner is called upon to show cause as to why penalty proceedings under section 217F of the Act should not be initiated in his case as he had not furnished return of income in response to the notice under section 148 of the Act and stating that this may be treated as notice under section 142(1) read with section 129 of the Income Tax Act, 1961. 10. By an order d....
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....der section 148 of the Act was issued to a dead person. The petitioner being the heir and legal representative of the deceased, upon receipt of the notice, immediately raised objection against the validity of the impugned notice and did not submit to the jurisdiction of the Assessing Officer by filing a return of income, but kept on objecting to the continuation of the assessment proceedings pursuant to the impugned notice. The Assessing Officer, however, instead of taking corrective steps under section 292B of the Act and issuing notice to the heirs and legal representatives, insisted on continuing with the proceedings pursuant to the impugned notice which was issued in the name of a dead person. Since strong reliance has been placed by the learned counsel 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 ....
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....representative under this section shall, subject to the provisions of sub-section (4) and sub-section (5), be limited to the extent to which the estate is capable of meeting the liability." "292B. Return of income, etc., not to be invalid on certain grounds. - No return of income, assessment, notice, summons or other proceeding furnished or made or issued or taken or purported to have been furnished or made or issued or taken in pursuance of any of the provisions of this Act shall be invalid or shall be deemed to be invalid merely by reason of any mistake, defect or omission in such return of income, assessment, notice, summons or other proceeding if such return of income, assessment, notice, summons or other proceeding is in substance and effect 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. Sub-section (2) of section 159 of the Act says that for the purpos....
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....section 148 of the Act issued to the dead person, cannot be continued against the legal representative. 16. On behalf of the revenue, it has been contended that issuance of the notice to the dead assessee is merely a technical defect which could be corrected under section 292B of the Act. Reliance has been placed on the above referred decisions of the Supreme Court as well as the High Courts for contending that the proceedings would not be null and void merely because the notice has been issued against a dead person as the legal representative had received the notice and has objected to the validity of the notice and further continuation of the proceedings. In the opinion of this court, here lies the distinction between those cases and the present 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 ther....
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....n the opinion of this court, the decision of this court in the case of Rasid Lala v. Income Tax Officer, Ward-1(3)(6)(supra) would be squarely applicable to the facts of the present case. Therefore, in view of the provisions of section 159(2)(b) of the Act, it is permissible for the Assessing Officer to issue a fresh notice under section 148 of the Act against the legal representative, provided that the same is not barred by limitation; he, however, cannot continue the proceedings on the basis of an invalid notice issued under section 148 of the Act to the dead assessee. 19. In the facts of the present case, as noticed hereinabove, the notice under section 148 of the Act, which is a jurisdictional notice, has been issued to a dead person. Upon receipt of such notice, the legal representative has raised an objection to the validity of such notice and has not complied with the same. The legal representative not having waived the requirement of notice under section 148 of the Act and not having submitted to the jurisdiction of the Assessing Officer pursuant to the impugned notice, the provisions of section 292B of the Act would not be attracted and hence, the notice under sec....