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TMI Blog2023 (2) TMI 580X X X X Extracts X X X X X X X X Extracts X X X X ..... ani proposing to assess his total income for the Assessment Year 2013-14. 3. The petitioner, as a legal heir of the deceased, had informed the respondent that late Shri Vinod Kanjibhai Hirani expired on 18.11.2017. The grievance on the part of the petitioner is that the respondent may finalize the assessment. 4. On the ground that the petitioner cannot be compensated in terms of money and it is well settled position of law that no notice can lie against the dead person, the present petition is preferred with the following reliefs:- "10.0 The Petitioner, therefore, prays that this Hon'ble Court be pleased (a) to issue a writ of certiorari or in the nature of certiorari or any other appropriate writ, orders or directions quashing and setting aside the impugned notice dated 13.04.2021 [ANNEXURE-A] issued by the Respondent proposing to reopen the completed assessment of the Petitioner for A.Y. 2013-14. (b) to issue a writ of of certiorari or in the nature of certiorari or any other appropriate writ, orders or directions declaring section 3(1) of the Taxation and other laws ( Relaxation and Amendment of Certain Provisions) Act 2020 and the notifications thereunder, including the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be unenforceable in law. The Revenue in such case cannot contend that it had no knowledge about the death of the assessee and, therefore, they are entitlement to plead that the notice is not defective. The word " person" defined in section 231 of the Income Tax Act, also has been discussed. "12. In the aforesaid context, Mr.Bhatt invited the attention of this Court to Section 139A(5)(d) of the Act, which reads as under: "5. Every person shall, --- (d) Intimate the Assessing Officer any change in his address or in the name and nature of his business on the basis of which the permanent account number was allotted to him." 13. Mr.Bhatt, thereafter, invited the attention of this Court to Section 140 of the Act. Section 140 provides as to the verification of the return. Section 140(a) of the Act reads thus : "140. The return under Section 115WD or Section 139 shall be verified-- (a) in the case of an individual,--- (i) by the individual himself; or (ii) where he is absent from India, by the individual himself or by some person duly authorised by him on his behalf; or (iii) where he is mentally incapacitated from attending to his affairs, by his guardian or any other pers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hority; and (vii) every artificial juridical person not falling within any of the preceding sub-clauses. Explanation.-- For the purposes of this clause, an association of persons or body of individuals or a local authority or an artificial juridical persons shall be deemed to be a person, whether or not such person or body or authority or juridical person was formed or established or incorporated with the object of deriving income, profits or gains;" 17. The endeavour on the part of Mr.Bhatt is to make good his submission that the legal heir of late Bhupendrabhai Desai would fall within the ambit of "body of individuals" and, therefore, it cannot be said that the notice under Section 153C is invalid. The impugned notice could be said to be valid against the legal heir of late Bhupendrabhai Desai. 18. In the last, Mr.Bhatt invited the attention of this Court to Section 124(3)(c) of the Act, which reads thus : "124. Jurisdiction of Assessing Officers.-- (1) xxxx xxxx (2) xxxx xxxx (3) No person shall be entitled to call in question the jurisdiction of an Assessing Officer--- a) xxxx xxxx (b) xxxx xxxx (c) where an action has been taken under Section 132 or Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this case, the notice has been issued to a dead person and hence, such notice is null and void. To initiate proceedings under section 147 of the Act, issuance of notice under section 148 of the Act to the heirs and legal representatives of the deceased is mandatory, in the absence of which the proceedings cannot be continued by issuance of notices under section 142(1) of the Act against the heirs. Reliance was placed upon the decision of this court in Rasid Lala v. Income Tax Officer, Ward-1(3)(6), (2017) 77 Taxman.com 39 (Guj.), wherein the notice under section 148 of the Act was issued to the assessee long after he had passed away. The heir of the deceased informed the Assessing Officer that the assessee has passed away and, therefore, the notice under section 148 of the Act is invalid, despite which the heir was told to file the return of income in compliance of the said notice. The court held that the notice issued in the name of a dead person was not valid and that despite being informed about the death of the original assessee, the assessee, instead of taking corrective measures as provided under section 292B of the Act and issuing fresh notice to the heirs of the deceased, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ration. 18. In such circumstances, the question would be as to whether Section 159 of the Act would get attracted. The answer to this question would be in the negative, as the proceedings under Section 159 of the Act can be invoked only if the proceedings have already been initiated when the assessee was alive and was permitted for the proceedings to be continued as against the legal heirs. The factual position in the instant case being otherwise, the provisions of Section 159 of the Act have no application. 19. The Revenue seeks to bring their case under Section 292 of the Act to state that the defect is a curable defect and on that ground, the impugned notice cannot be declared as invalid. 20. The language employed in Section 292 of the Act is categorical and clear. The notice has to be, in substance and effect, in conformity with or according to the intent and purpose of the Act. Undoubtedly, the issue relating to limitation is not a curable defect for the Revenue to invoke Section 292B of the Act. " 5.3 It was, accordingly, urged that the petition deserves to be allowed by granting the reliefs as prayed for. 6. Vehemently opposing the petition, Mrs. Mauna Bhatt, learn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner had knowledge of the proceedings and has responded to the same as legal representative of the deceased and, therefore, the procedural defect which is otherwise curable may be permitted to be cured. 6.2 Reference was made to section 2(29) of the Act, which says that "legal representative" has the meaning assigned to it in clause (11) of section 2 of the Code of Civil Procedure, 1908. 6.3 The learned counsel further invited the attention of the court to the provisions of section 292B of the Act, which inter alia provide that no notice, summons or other proceeding, issued or taken in pursuance of any of the provisions of the Act shall be invalid or shall be deemed to be invalid merely by reason of any mistake, defect or omission in such notice, summons or other proceeding if such notice, summons or other proceeding is, in substance and effect, in conformity with or according to the intent and purpose of the Act. It was submitted that in the light of the provisions of section 292B of the Act, the defect in the notice by issuing the same to a dead person would not render the notice invalid, inasmuch as it is a purely procedural lapse. 6.4 Reliance was placed upon the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deceased. Assessment orders were made in the name of all the ten legal representatives who were described as legal representatives of the deceased. Appeals were filed by Jai Prakash contending that the assessments were illegal and invalid as no notice had been issued to all the legal representatives of deceased. The court placed reliance upon a decision of the Bombay High Court in Maharaja of Patiala v. Commissioner of Income Tax (Central), Bombay, (1943) 11 ITR 201, for the proposition that an assessment made without strictly complying with section 24-B (section 159 in the present Act) is not void or illegal and that any infractions in that behalf can be waived by the assessee. The court also placed reliance upon its earlier decision in Estate of Late Rangalal Jajodia v. Commissioner of Income Tax, Madras, (1971) 79 ITR 505, for the proposition that an omission to serve or any defect in the service of notices provided by procedural provisions does not efface or erase the liability to pay tax where such liability is created by distinct substantive provisions (charging sections). Any such omission or defect may render the order made irregular - depending upon the nature of the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment for assessment year 2011-12 under section 148 of the Income Tax Act, 1961. By a letter dated 27.04.2018 addressed to the Income Tax Officer, the petitioner informed him that his father Shri Jayantilal Harilal Patel has passed away on 24.06.2015, enclosing therewith a death certificate and further being his son and in his capacity as legal heir, requested him to drop the proceedings. Thereafter, another notice dated 10.07.2018 came to be issued under sub-section (1) of section 142 of the Act to Shri Jayantilal Harilal Patel calling upon him to furnish the details mentioned therein. In the annexure to the said notice, the assessee was called upon to show cause as to why penalty proceedings under section 217F of the Act should not be initiated in his case as he had not furnished return of income in response to the notice under section 148 and stating that this may be treated as a notice under section 142(1) read with section 129 of the Income Tax Act, 1961. 8. The petitioner addressed a letter dated 02.08.2018 to the Income Tax Officer objecting to the notices issued under section 148 as well as under section 142(1) of the Act and drew his attention to the earlier letter dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice dated 28.03.2018 is issued defectively in the name of the deceased assessee, then also, as per the provisions of section 292B of the Act, the same cannot be held to be invalid. 11. Insofar as the contention raised by the petitioner based on section 159 of the Act is concerned, the Assessing Officer observed that in this case, the assessee (the petitioner) had introduced himself as a son of the deceased assessee and as legal heir and has produced death certificate in response to the notice issued under section 148 of the Act. Therefore, as the legal heir, upon being served with the notice under section 148, has participated in the proceedings, the reassessment proceedings initiated are legal and valid. Reliance has been placed upon the decision of the Madras High Court in the case of V. Ramanathan v. Commissioner of Income Tax, (1963) 49 ITR 881 (Madras). It is further stated therein that it is not in dispute that Shri Chandreshbhai J. Patel is the legal heir of the deceased assessee; therefore, the proceedings initiated against the legal representative/legal heir are valid and legal. 12. In the backdrop of the aforesaid facts, it is an admitted position that the notice u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esentative from the stage at which it stood on the date of the death of the deceased; (b) any proceeding which could have been taken against the deceased if he had survived, may be taken against the legal representative; and (c) all the provisions of this Act shall apply accordingly. (3) The legal representative of the deceased shall, for the purposes of this Act, be deemed to be an assessee. (4) Every legal representative shall be personally liable for any tax payable by him in his capacity as legal representative if, while his liability for tax remains undercharged, he creates a charge on or disposes of or parts with any assets of the estate of the deceased, which are in, or may come into, his possession, but such liability shall be limited to the value of the asset so charged, disposed of, or parted with. (5) The provisions of sub-section (2) of section 161, section 162 and section 167, shall, so far as may be and to the extent to which they are not inconsistent with the provisions of this section, apply in relation to a legal representative. (6) The liability of a legal representative under this section shall, subject to the provisions of sub-section (4) and subsect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the facts of this case. 15. Clause (b) of sub-section (2) of section 159 of the Act provides that any proceeding which could have been taken against the deceased if he had survived may be taken against the legal representative. The present case would, therefore, fall within the ambit of section 159(2)(b) of the Act and, hence, the proceeding can be taken against the legal representative. Now, it cannot be gainsaid that a proceeding under section 147 of the Act of reopening the assessment is initiated by issuance of notice under section 148 of the Act, and as a necessary corollary, therefore, for taking a proceeding under that section against the legal representative, necessary notice under section 148 of the Act would be required to be issued to him. In the present case, the impugned notice under section 148 of the Act has been issued against the deceased assessee. In the opinion of this court, since this is not a case falling under clause (a) of sub-section (2) of section 159 of the Act, the proceeding pursuant to the notice under section 148 of the Act issued to the dead person, cannot be continued against the legal representative. 16. On behalf of the revenue, it has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, and existence of a valid notice under section 148 is a condition precedent for exercise of jurisdiction by the Assessing Officer to assess or reassess under section 147 of the Act. The want of a valid notice affects the jurisdiction of the Assessing Officer to proceed with the assessment and thus, affects the validity of the proceedings for assessment or reassessment. A notice issued under section 148 of the Act against a dead person is invalid, unless the legal representative submits to the jurisdiction of the Assessing Officer without raising any objection. Therefore, where the legal representative does not waive his right to a notice under section 148 of the Act, it cannot be said that the notice issued against the dead person is in conformity with or according to the intent and purpose of the Act which requires issuance of notice to the assessee, whereupon the Assessing Officer assumes jurisdiction under section 147 of the Act and consequently, the provisions of section 292B of the Act would not be attracted. In the opinion of this court, the decision of this court in the case of Rasid Lala v. Income Tax Officer, Ward- 1(3)(6) (supra) would be squarely applicable to the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the legal heir of late Bhupendrabhai Desai had not participated in the proceedings. All that the legal heir of late Bhupendrabhai Desai did was to inform the Assessing Officer about the death of his father and requested to drop the proceedings. It is true that although the father passed away in the year 2017, yet the legal heir did not inform the department upto October 2019. However, at the same time, we should not overlook the fact that even after coming to know about the demise of late Bhupendrabhai, the department could have issued a valid notice to the legal heir as the period of limitation of 21 months had not expired. We fail to understand what prevented the department from issuing a valid notice to the legal heir within the prescribed time period. 25. In the aforesaid context, we may refer to a recent pronouncement of the Supreme Court in the case of Principal Commissioner of Income Tax, New Delhi vs. Maruti Suzuki India Limited, (2019) 107 taxmann.com 375 (SC). The ratio of this decision of the Supreme Court is that during the pendency of the assessment proceedings if the assessee company gets amalgamated with another company, it would lose its existence and the ass ..... 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