2017 (12) TMI 1830 - HC - Income Tax

Reassessment proceedings u/s 148 to a dead person - HELD THAT - The factum of Tara Bhardwaj death on 11.10.2010 is not in dispute. From the record, it is apparent that the petitioner vide letter dated 03.09.2013 informed the Income Tax Department of Ms.Tara Bhardwaj s death on 11.10.2010. That information was mechanically receipted and overlooked. The death certificate of Ms. Tara Bhardwaj has now admittedly submitted to the Income Tax Department testifying of her death on 11.10.2010. It is thus apparent that the notices impugned have been issued to a dead person and cannot sustain.

Summary

Issues:
- Validity of notice issued under Section 148 of the Income Tax Act, 1961
- Validity of notice issued under Section 142(1) of the Income Tax Act, 1961
- Reassessment proceedings for the Assessment Year 2010-11
- Effect of the death of the taxpayer on the notices issued

Validity of Notice under Section 148:
The judgment concerns a challenge to a notice issued under Section 148 of the Income Tax Act, 1961, to Ms. Tara Bhardwaj, who had passed away on 11.10.2010. The petitioner, representing Ms. Bhardwaj's legal heir, argued that the notices were invalid due to the knowledge of her demise, as communicated to the Income Tax Department. The respondent admitted receiving information about the death but contended that the death certificate was submitted only later. The court acknowledged the undisputed fact of Ms. Bhardwaj's death and found that the notices were erroneously issued to a deceased person, rendering them unsustainable.

Validity of Notice under Section 142(1):
In addition to the notice under Section 148, challenges were raised against notices issued under Section 142(1) for filing returns for reassessment proceedings for the Assessment Year 2010-11. The petitioner argued that the notices were null and void due to Ms. Bhardwaj's demise, which was known to the Income Tax Department. The respondent explained that the notices were sent as Ms. Bhardwaj's PAN card had not been canceled and she was still recorded as alive. However, the court found that the notices were improperly issued in light of the submitted death certificate and the prior communication of her death.

Reassessment Proceedings for Assessment Year 2010-11:
The judgment specifically addresses the reassessment proceedings for the Assessment Year 2010-11 in relation to Ms. Bhardwaj. It highlights the crucial fact of her demise on 11.10.2010 and the subsequent submission of her death certificate to the Income Tax Department. The court emphasized that the notices sent for reassessment to a deceased individual were legally untenable, leading to the quashing of the impugned notices dated 13.06.2017, 18.07.2017, and 29.03.2017.

Effect of the Taxpayer's Death on Notices Issued:
The central issue in this judgment revolves around the impact of Ms. Bhardwaj's death on the validity of the notices issued by the Income Tax Department. Despite the department's awareness of her demise, the notices were mistakenly sent to her, indicating a procedural error. The court, after due consideration, concluded that the notices were unsustainable and, consequently, allowed the petition, thereby quashing the impugned notices.