2022 (2) TMI 930 - HC - Income Tax

Validity of Reopening of assessment u/s 147 - notice issued to dead person - curable defect u/s 292B or not ? - HELD THAT - The sine qua non for acquiring jurisdiction to reopen an assessment is that such notice should be issued in the name of the correct person. This requirement of issuing notice to a correct person and not to a dead person is not a merely a procedural requirement but is a condition precedent to the impugned notice being valid in law. Thus, a notice which has been issued in the name of the dead person is also not protected either by provisions of Section 292B or 292BB of the Act. This is so as the requirement of issuing a notice in the name of correct person is the foundational requirement to acquire jurisdiction to reopen the assessment. This is evident from Section 148 which requires that before a proceeding can be taken up for reassessment, a notice must be served upon the assessee. The assessee on whom the notice must be sent must be a living person i.e legal heir of the deceased assessee, for the same to be responded. This in fact is the intent and purpose of the Act. Therefore, Section 292B of the Act cannot be invoked to correct a foundational / substantial error as it is meant so as to meet the jurisdictional requirement. Therefore notice issued to a dead person is not valid. See LATE BHUPENDRA BHIKHALAL DESAI (SINCE DECD.) 2021 (9) TMI 431 - SC ORDER - Decided in favour of assessee.

Summary

Issues involved:
1. Validity of notice issued under Section 148 of the Income Tax Act, 1961 to a deceased person.
2. Compliance with mandatory provisions of law in issuing the notice.

Detailed Analysis:

1. Validity of notice issued to a deceased person:
The judgment addresses the challenge to a notice issued under Section 148 of the Income Tax Act, 1961 to a deceased individual for the assessment years 2013-14 and 2014-15. The petitioner, as the legal heir, contested the validity of the notice on the grounds that it was issued to a deceased person, making it null and void in law. The court referred to previous judgments, such as Sumit Balkrishna Gupta vs. Assistant Commissioner of Income Tax, to establish that issuing a notice in the name of a deceased person for reassessment is legally invalid. The court emphasized that issuing a notice to the correct person is a foundational requirement for reopening an assessment, and failure to do so renders the notice void. The judgment highlighted that such errors cannot be rectified using provisions like Section 292B of the Act, as issuing a notice to the correct person is essential to acquire jurisdiction for reassessment. The court ultimately quashed the notice, allowing the Revenue to issue a fresh notice if statutory requirements are met.

2. Compliance with mandatory provisions of law:
The judgment did not delve into the aspect of whether the respondent correctly issued the notice without adhering to mandatory provisions of law, as the primary issue of the notice being invalid due to being addressed to a deceased person was sufficient to dispose of the petitions. The court's decision to quash the notice on the grounds of it being issued to a deceased individual preempted the need to address the compliance aspect, as the notice was deemed not maintainable. Consequently, the court did not delve into the respondent's compliance with mandatory provisions in issuing the notice.

In conclusion, the judgment primarily focused on the invalidity of a notice issued under Section 148 of the Income Tax Act, 1961 to a deceased person for the assessment years 2013-14 and 2014-15. The court emphasized the importance of issuing notices to the correct individuals for reassessment, highlighting that such errors are not curable under certain provisions of the Act. The decision to quash the notice due to it being addressed to a deceased person rendered further analysis of compliance with mandatory provisions unnecessary, as the primary issue was resolved by declaring the notice null and void.