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2023 (8) TMI 385 - HC - Income TaxReassessment against dead person - Respondent-authorities issued the notice to the legal heir of late Assessee u/s 292B - scope of amended provisions of Act - HELD THAT - As in the case on hand, the Respondent-authorities initiated the proceedings, u/s 148 of the Act, against the dead person, by issuing notice on 27.03.2021. Subsequently, an amendment in the Act came into force with effect from 01.04.2021. Under the circumstances, we are of the considered opinion that, if, any notice is to be issued under Section 148 of the Act in post 01.04.2021 period, the procedure required under the amended Act was required to be followed. Here, it is pertinent to note that the notice was issued in the name of the present petitioner, who happens to be the legal heir of the original assessee, i.e. late Ms. Shah. Thus, it becomes clear that, before issuing the notice to the present petitioner, the Respondent-authorities failed to comply with the provisions of the amended Act. It is not being disputed by the Respondent-authorities that the impugned order is also passed in the name of the dead person, i.e. late Ms. Shah, which is a nullity. The provisions of Section 292B and 292BB of the Act shall not apply in the facts of the case on hand, as discussed herein above. Keeping in mind the ratio laid down by the Apex Court 2019 (7) TMI 1449 - SUPREME COURT on the issue involved in this matter as well as the decisions of the other High Courts, we are of the view that the proceedings initiated by the Respondent-authorities against a dead person, in this case, as well as the impugned orders passed by it deserves to be quashed and set aside.
Issues Involved:
1. Issuance of notice under Section 148 of the Income Tax Act, 1961 to a deceased person. 2. Validity of subsequent notices and assessment orders issued to the legal heir. 3. Applicability of Sections 292B and 292BB of the Income Tax Act. Summary: Issue 1: Issuance of Notice to Deceased Person The petitioner contended that the notice under Section 148 of the Income Tax Act, 1961 was issued to the deceased Ms. Shah, making it void ab initio. The court noted that the original assessee, Ms. Shah, had passed away on 16.02.2021, and the notice was issued on 27.03.2021. The court referred to various precedents, including 'Chandreshbhai Jayantibhai Patel Vs. ITO' and 'Savita Kapila Vs. Assistant Commissioner of Income-tax, Circle 4(1)', which held that notices issued to deceased persons are invalid and cannot be cured by Sections 292B and 292BB. Issue 2: Validity of Subsequent Notices and Assessment OrdersThe court observed that after the death of Ms. Shah, the respondent authorities issued a notice to the legal heir, the petitioner, but the assessment order was still passed in the name of the deceased. This was deemed a nullity. The court emphasized that any notice issued post-01.04.2021 must comply with the amended provisions of the Act, which was not done in this case. The court cited 'PCIT Vs. Maruti Suzuki India Ltd.' and 'Sandeep Chopra Vs. Principal Commissioner of Income Tax' to support its decision that proceedings against a deceased person are void. Issue 3: Applicability of Sections 292B and 292BBThe court held that Sections 292B and 292BB do not apply to the facts of this case. Section 292B cannot save a notice issued to a dead person, and Section 292BB applies to an assessee, not to a legal representative. The court referred to 'Rajender Kumar Sehgal Vs. ITO' and 'Krishnaawatar Kabra Vs. Income-Tax Officer' to underline that these sections cannot cure the fundamental defect of issuing a notice to a deceased person. Conclusion:The court quashed and set aside the impugned notices dated 27.03.2021 and 30.06.2021, as well as the assessment order dated 29.03.2023, declaring them null and void. The petition was allowed, and the rule was made absolute.
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