2023 (8) TMI 1023 - HC - Income Tax

Validity of reassessment proceedings against dead person - HELD THAT - The case of the petitioner is squarely covered by the decision 2023 (8) TMI 931 - GUJARAT HIGH COURT which concluded that proceedings initiated by the Respondent authorities against a dead person, deserves to be quashed and set aside. Decided in favour of assessee.

Summary

Issues Involved:
1. Validity of proceedings against a deceased person.
2. Applicability of Sections 292B and 292BB of the Income Tax Act.
3. Compliance with amended provisions of the Income Tax Act post-01.04.2021.

Summary:

1. Validity of Proceedings Against a Deceased Person:
The petitioner sought a writ of certiorari to quash the order u/s 143(3) of the Income Tax Act, 1961, dated 28.03.2022, and the notice dated 28.03.2021, which proposed to reopen the assessment of a deceased assessee for AY 2016-17. The court referred to a similar case (Special Civil Application No. 18788 of 2022) where it was established that proceedings against deceased persons are void ab initio. The court cited multiple precedents, including the cases of Krishnaawtar Kabra, Chandreshbhai Jayantibhai Patel, and Rajender Kumar Sehgal, affirming that initiating proceedings against a dead person is non est and void ab initio.

2. Applicability of Sections 292B and 292BB of the Income Tax Act:
The court examined Sections 292B and 292BB, which address the validity of notices despite defects, and concluded that these sections do not apply to notices issued to deceased persons. The court highlighted that Section 292BB is applicable to an assessee and not to a legal representative, and it does not save the complete absence of notice. The court cited several cases, including Sandeep Chopra and Savita Kapila, to support this interpretation.

3. Compliance with Amended Provisions of the Income Tax Act Post-01.04.2021:
The court noted that the notice was issued in the name of the petitioner, who is the legal heir of the deceased assessee, after the amendment to the Income Tax Act effective from 01.04.2021. The court emphasized that the respondent authorities failed to comply with the amended provisions before issuing the notice. Consequently, the impugned order passed in the name of the deceased was deemed a nullity.

Conclusion:
The court allowed the petition, quashing and setting aside the impugned order u/s 143(3) dated 28.03.2022 and the notice dated 28.03.2021. The rule was made absolute, and direct service was permitted, with no order as to costs.