2022 (4) TMI 1442 - HC - Income Tax

Assessment against legal heir of the deceased assessee - Present petitioner is nephew of Assessee who died - HELD THAT - Whether the petitioner has gained anything from the deceased assessee through their Bank accounts to the extent of Rs.70 Lakhs and if so, whether the said amount belongs to the original assessee Venkatadri or somebody's and within the said amount, since the tax due under the impugned order to the extent of Rs.61 Lakhs would be covered or not, are the factual matrix, which can be gone into only by the Appellate Authority and not by this Court. There is no violation of principles of natural justice in this case as the petitioner also has been issued with a notice on the aforestated circumstances and after giving such an opportunity to the petitioner, the impugned order of assessment since been passed, it cannot be assailed before this Court on the ground of violation of principles of natural justice or any other valuable ground, under which the extraordinary jurisdiction of this Court can be invoked. This Court has no hesitation to hold that this writ petition cannot be entertained for such reasons as it is not maintainable before this Court by relegating the petitioner to go before the Appellate Authority for filing a quantum appeal before the Commissioner (Appeals). This Writ Petition is dismissed with the aforesaid observation.

Summary

Issues:
Challenge to Assessment Order dated 31.03.2022 for AY 2017-18 under Sections 147 and 144 of the Income Tax Act, 1961.
Legal heirship and liability of petitioner as the nephew of the deceased assessee.
Interpretation of legal representative under Section 159 of the Income Tax Act and Section 2(29) of the Act.
Violation of principles of natural justice in assessment proceedings.
Maintainability of writ petition before the High Court.

Analysis:
The petitioner sought a writ of certiorari to challenge the Assessment Order dated 31.03.2022 for the Assessment Year 2017-18 under Sections 147 and 144 of the Income Tax Act, 1961. The petitioner, claiming to be the nephew of the deceased assessee, contested the assessment proceedings initiated against him as the legal heir or representative of the deceased assessee. The petitioner argued that he was not liable under the Income Tax Act as he was only a nephew of the deceased and not the legal heir. Despite the petitioner's contentions, the Revenue proceeded with the assessment, leading to the filing of the writ petition.

The respondent, relying on Section 159 of the Income Tax Act and the definition of "legal representative" under Section 2(29) of the Act, argued that anyone who inherited or intermeddled with the estate of the deceased assessee could be proceeded against by the Revenue for tax recovery. The court considered the submissions of both parties and deliberated on whether the petitioner had received Rs.70 Lakhs from the deceased assessee's bank accounts and if this amount was subject to the tax liability under the impugned order. The court noted that such factual determinations fell within the purview of the Appellate Authority and not the High Court.

Regarding the alleged violation of principles of natural justice, the court found that the petitioner had been issued notices and provided with an opportunity to present his case during the assessment proceedings. Consequently, the court held that there was no violation of natural justice that would warrant the High Court's intervention. The court emphasized that the petitioner could appeal to the Appellate Authority for further recourse instead of seeking relief directly from the High Court.

In conclusion, the High Court dismissed the writ petition, stating that it was not maintainable before the court. The petitioner was directed to file a quantum appeal before the Commissioner (Appeals) within two weeks from the date of receipt of the court's order. The court made no order regarding costs and closed all connected miscellaneous petitions.