1966 (3) TMI 93 - HC - Income Tax

Summary

Issues Involved:
1. Whether the writ petitioner, Sulochanamma, is the legal representative of the deceased, Narayana Reddi.
2. Validity of the notice issued in respect of the assessment year 1949-50.
3. Whether the notices issued to Sulochanamma are invalid due to the absence of notices to other legal representatives.
4. Liability of the writ petitioner to pay taxes subsequent to Narayana Reddi's death.

Detailed Analysis:

1. Legal Representative of the Deceased:
The primary issue is whether the writ petitioner, Sulochanamma, is the legal representative of the deceased, Narayana Reddi. The department's counsel argued that under the compromise decree, the petitioner, her four sisters, and their mother were given shares, making them legal representatives. The respondents' counsel contended that the shares given to the daughters were out of grace by the widow, who was the sole heir. The court noted that although the compromise decree did not explicitly accept the will, it appeared that the will was the main consideration. The properties were divided among the daughters and the widow, and provisions were made for the mother and charities, aligning with the will's directions. Thus, the court concluded that the daughters and the widow, being in possession of the properties as heirs, are legal representatives of the deceased under section 2(11) of the Code of Civil Procedure.

2. Validity of Notice for Assessment Year 1949-50:
The court addressed whether the notice issued to Sulochanamma for the assessment year 1949-50 was valid. The respondents argued that the notice was invalid as it was not served on all legal representatives. The court found that notices must be served on all legal representatives to be valid. Since the notice was not served on the mother of the deceased and the charitable institution, it was deemed invalid.

3. Absence of Notices to Other Legal Representatives:
The court examined whether the notices issued to Sulochanamma were invalid due to the absence of notices to other legal representatives. The respondents argued that notices were not served on the mother of the deceased and the charitable institution, who were also allotted shares. The court referenced previous judgments, including E. Alfred v. First Addl. Income-tax Officer, Salem, and Suseela Sadanandan v. Additional Income-tax Officer, which held that all legal representatives must be served with notices. The court concluded that the absence of notices to the mother and the charitable institution invalidated the notices issued to Sulochanamma and her sisters.

4. Liability to Pay Taxes Post-Death:
The final issue was whether the writ petitioner, as a legal representative, is liable to pay taxes subsequent to Narayana Reddi's death. The court agreed with the learned brother's view that the petitioner cannot be held liable for taxes following Narayana Reddi's death. This position was supported by Supreme Court decisions in Commissioner of Income-tax v. Amarchand N. Shroff and Commissioner of Income-tax v. James Anderson, which clarified that legal representatives are not liable for taxes post the deceased's death.

Conclusion:
The court dismissed the appeals with costs, agreeing with the learned brother's judgment that the petitioner and her sisters are not the legal representatives of the deceased, the notices issued were invalid due to the absence of notices to all legal representatives, and the petitioner is not liable for taxes subsequent to Narayana Reddi's death.