2021 (7) TMI 1323 - AT - Income Tax

Validity of reopening of assessment - whether notice under Section 148 could be issued in the name of a deceased? - HELD THAT - It is a settled principle of law that reopening notice issued in the name of a deceased person is not tenable in the eye of law. Neither the reopening notice under Section 148 issued to a dead person could be continued against legal representatives. Reliance is placed on the judgment passed by the Hon ble Jurisdictional High Court in the case of Urmilaben Anirudhsinhji Jadeja 2019 (9) TMI 356 - GUJARAT HIGH COURT , MARUTI SUZUKI INDIA LIMITED 2019 (7) TMI 1449 - SUPREME COURT AND CHANDRESHBHAI JAYANTIBHAI PATEL 2019 (1) TMI 353 - GUJARAT HIGH COURT Thus we find no merit in the initiation of the proceeding against the person who died more than three years prior to the date of issuance of notice under Section 148 - Decided in favour of assessee.

Summary

Issues:
1. Validity of issuing notice under Section 148 in the name of a deceased individual.

Analysis:
The appeal before the Appellate Tribunal ITAT Ahmedabad involved the validity of issuing a notice under Section 148 of the Income Tax Act, 1961 in the name of a deceased individual for the assessment year 2007-08. The assessee had filed the original return of income, which was duly assessed under Section 143(1). However, a notice under Section 148 was issued in the name of the deceased individual for reassessment. The main contention was whether such reassessment proceedings could be initiated against a deceased person.

The First Appellate Authority had confirmed the addition made during the reassessment, despite objections raised by the assessee's representative regarding the validity of initiating proceedings under Section 147/148 against a deceased individual. During the appellate proceedings, the representative cited relevant case laws, including Urmilaben Anirudhsinhji Jadeja vs. ITO, PCIT vs. Maruti Suzuki India Ltd., and Chandrashbhai Jayantibhai Patel vs. ITO, to support the contention that issuing a notice to a deceased person is not legally tenable.

The Appellate Tribunal considered the legal principles established by various High Court judgments and concluded that issuing a notice under Section 148 to a deceased individual, and continuing proceedings against legal representatives, is not sustainable in the eyes of the law. Relying on the precedents set by the Jurisdictional High Court and other High Courts, the Tribunal found no merit in initiating proceedings against a person who had passed away more than three years before the notice was issued. Consequently, the reassessment proceedings were deemed liable to be quashed, and the appeal filed by the assessee was allowed.

In summary, the judgment emphasized the legal principle that initiating proceedings under Section 148 against a deceased person is not permissible under the law. The decision was based on established case laws and the interpretation of relevant provisions of the Income Tax Act, ultimately leading to the quashing of the reassessment proceedings in this case.