2022 (8) TMI 1038 - HC - Income Tax

Reopening of assessment against dead person - validity of notice in the name of the deceased under Section 142(1) Scope of proceedings against legal representatives - HELD THAT - Assessee died on 21.12.2012 in whose name, notice was issued by the income tax authorities on 12.03.2019 under Section 148 seeking to reopen assessment in respect of assessment year 2012-13 by communication dated 03.05.2019, the petitioner herein who happens to be the legal representative intimated to the income tax officer concerned that the noticee Kandarp Yasashvibhai Mehta had died long back and that the notice was without jurisdiction. The income tax authorities did not pay heed to the said intimation. The facts of the case did not offer any fact or circumstances to suggest that the legal representative of the deceased assessee in any manner submitted to the jurisdiction of the income tax authorities or in any way participated in the proceedings to persuade the court to hold otherwise. On the contrary, the intimation in form of communication dated 03.05.2019 was sent to the income tax officer by the legal representative that the noticee Kandarp Yasashvibhai Mehta had died. This intimation was repeated in form of communication dated 13.09.2019. Present petition deserves to be allowed. It is hereby allowed by holding that the impugned notice, which was against the dead assessee could not be sustained. - Decided in favour of assessee.

Summary

Issues:
1. Validity of notice under Section 148 of the Income Tax Act, 1961 issued to a deceased person.
2. Legal implications of subjecting a dead person to assessment proceedings.
3. Interpretation of Section 292B of the Income Tax Act in cases involving deceased individuals.

Analysis:

1. The petitioner filed a petition under Article 226 of the Constitution challenging a notice issued under Section 148 of the Income Tax Act, 1961 to reopen the assessment of a deceased individual. Despite the petitioner, being the legal heir, informing the authorities about the death of the assessee, subsequent notices were issued, leading to the question of the validity of such proceedings.

2. The High Court referred to a previous judgment where it was established that assessment proceedings against a deceased person are invalid unless their legal representatives actively participate in the process. The Court emphasized that mere intimation of the death of the assessee does not constitute legal representation, rendering the proceedings null and void.

3. Section 292B of the Income Tax Act, which deems notice valid under certain circumstances, was analyzed. The Court clarified that this provision does not apply when notices are issued to deceased individuals. It was held that proceedings against a dead person lack jurisdiction and are considered a legal defect rather than a procedural irregularity.

4. In the present case, the Court found that the legal representative did not submit to the jurisdiction of the income tax authorities or participate in the proceedings. As a result, the notice issued to the deceased assessee was deemed illegal and set aside. The Court emphasized that no assessment can be framed against a deceased individual, and the income tax authorities were barred from proceeding further in this matter.

5. The judgment concluded by setting aside the notice dated 12.03.2019 and prohibiting the income tax authorities from continuing the assessment against the deceased assessee. The ruling clarified the legal stance on conducting assessment proceedings involving deceased individuals and highlighted the importance of legal representation in such cases.

This detailed analysis of the judgment provides a comprehensive understanding of the legal issues involved and the Court's decision regarding the validity of assessment proceedings against deceased individuals under the Income Tax Act, 1961.