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TMI Blog1984 (11) TMI 99X X X X Extracts X X X X X X X X Extracts X X X X ..... s of sub-section (1), the WTO may impose penalty for every month during which the default continues. However, the proviso to sub-section (3) lays down that before levying such penalty, the assessee shall be given a reasonable opportunity of being heard. Shri Gopalji Jagmal died on 11-7-1978. Before his death, no proceeding for levy of penalty under section 15B(3) had been initiated. On 22-3-1980, the WTO issued a notice in the name of Shri Gopalji Jagmal, to show cause why the penalty under section 15B should not be levied. As already stated, Shri Gopalji Jagmal had died long before the date of issue of the said notice. Consequently, the executrix of his will, Smt. Dhangauri Gopalji, sent a reply on 18-4-1980. In this reply, she submitted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, on behalf of the department, is that there was no legal bar in initiating proceedings for levy of penalty under section 15B against the legal representative of the deceased, Shri Gopalji Jagmal, and as such the order of the AAC was erroneous. The learned counsel for the assessee, on the other hand, relied on the decision of the Allahabad High Court referred to above. His submission was that initiation of proceeding for levy of penalty under section 15B, after the death of Shri Gopalji Jagmal, was illegal. In the alternative, his submission was that this was a fit case where discretion of not levying penalty should be exercised in favour of the assessee. The facts on which he relied are financial stringency suffered by Shri Gopalji Jagm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... constructively received the same. The crucial question is, whether proceedings for levy of penalty could be initiated against her. 5. Section 19 of the Act contains the provision regarding liabilities of the legal representative of the deceased assessee. The executrix of the will of a deceased would also come under that category. Section 19(1) fastens liability on the executrix of the will of the assessee to pay out of the estate of the deceased person, to the extent to which the estate is capable of meeting the charge, any sum which would have been payable by the deceased under this Act if he had not died. This provision envisages that before the death of the deceased, a sum was outstanding against him in pursuance of an order passed un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the Allahabad High Court in Rameshwar Prasad's case is relevant in deciding the question before us. The question for determination in that case was whether proceeding for levy of penalty under section 18(1) of the Act, for late filing of the return by the deceased assessee, could be initiated against his legal representative. The High Court considered the provisions of section 19(1) and 19(3). The High Court observed that section 19(1) was confined to liability to pay any sum, which would have been payable by the deceased if he had not died. That provision, by itself, does not create on the legal representative liability to pay that which was non-existent till the date of death of the deceased. In other words, if an order creating liab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... representative would be deemed to be the assessee after the death of the deceased. In that capacity, the legal representative would be entitled to obtain refund of the amount. As far as the proceedings for initiation of penalty are concerned, it stands altogether on a different footing. As already stated, such proceedings cannot be initiated unless there are express provision in the Act. For the reasons given above, we hold that initiation of proceeding for levy of penalty under section 15B against Smt. Dhangauri Gopalji, the executrix of the will of the deceased Shri Gopalji Jagmal, was, in the circumstances, bad in law and as such, the order levying penalty was rightly cancelled. 8. In the context of the view, which we have taken, it i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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