2021 (5) TMI 456 - HC - Income Tax

Validity of reopening of assessment - notice to dead person - notice addressed to one Smt.K.Srivalli, who is the mother of the writ petitioner / Mr.K.Rajesh and it is contended that the assessee / Smt.K.Srivalli died on 02.07.2016 - Standing counsel appearing on behalf of the respondents objected the said contentions by stating that an adjudication / enquiry is required for the purpose of establishing these facts and in this regard, the petitioner has to submit the details and documents before the authorities, enabling them to form an opinion and proceed in accordance with law - HELD THAT - This Court is of the considered opinion that all such material facts and circumstances are to be established by submitting proof and evidences and such an exercise cannot be done by the High Court under Article 226 of the Constitution of India. The authorities competent must conduct an enquiry in this regard and take a decision and thereafter, proceed in accordance with law and by following the procedures. For this purpose, the matter is remanded back to the respondents for fresh adjudication. Accordingly, the notice issued by the first respondent under Section 148 of the Income Tax Act, 1961 dated 28.02.2018 is quashed and the matter is remanded back to the respondents for fresh adjudication by affording opportunity to the writ petitioner and pass orders on merits and in accordance with law and by following the procedures as contemplated.

Summary

Issues:
1. Validity of notice under Section 148 of the Income Tax Act to reopen assessment for the year 2009-10.

Analysis:
The petitioner challenged the notice issued under Section 148 of the Income Tax Act to reopen the assessment for the year 2009-10. The primary contention raised was that the notice was addressed to a deceased individual, Smt. K.Srivalli, who was the mother of the petitioner, Mr. K.Rajesh. It was argued that issuing a notice to a deceased person rendered the notice itself untenable. The petitioner's counsel emphasized that reopening an assessment on a deceased individual was legally impermissible.

The respondents, represented by the Senior Standing Counsel, opposed the petitioner's contentions. They argued that establishing the facts regarding the deceased assessee required an adjudication and enquiry, which could only be done by submitting relevant details and documents to the authorities. The court noted that the writ petition was filed by Mr. K.Rajesh, while the notice was addressed to his deceased mother, Smt. K.Srivalli. The court opined that factual aspects needed to be established through proof and evidence, a process not within the purview of the High Court under Article 226 of the Constitution of India.

The Court decided that the competent authorities must conduct an enquiry to establish the material facts and circumstances regarding the deceased assessee. Consequently, the Court quashed the notice issued under Section 148 of the Income Tax Act dated 28.02.2018 and remanded the matter back to the respondents for fresh adjudication. The respondents were directed to afford an opportunity to the writ petitioner, Mr. K.Rajesh, and pass orders on merits in accordance with the law and procedures. The Court instructed that this process should be completed within three months from the date of receipt of the order. The writ petitioner was directed to cooperate with the enquiry proceedings and not seek adjournments on frivolous grounds.

In conclusion, the writ petition was allowed with no costs, and the connected miscellaneous petition was closed. The judgment emphasized the importance of establishing facts through a proper enquiry by the competent authorities and following due procedures in matters concerning the reopening of assessments under the Income Tax Act.