Assessment against deceased person: Participation in the reassessment proceedings cannot be regarded as waiver or submitting to the jurisdiction of the AO without objection.
1. Delhi High Court has recently held that Participation in the reassessment proceedings cannot be regarded as waiver or submitting to the jurisdiction of the AO without objection in the case of assessment against deceased person.
Let us have a short overview of the case:
CASE DETAILS:
DELHI HIGH COURT IN MR KINSHUK GOEL LEGAL HEIR OF LATE SHRI VIJAY SHANKER GOEL VERSUS ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 49 (1).
No.- W. P. (C) 16438/2022
Dated.- September 26, 2024
The court in above case has made the following noteworthy observation as under::
The requirement of issuing notice in the name of a right person and not to a dead person is not merely a procedural requirement but is a condition precedent to the impugned notice being valid in law.
Even though, the initial notice under Section 148 dated 08.04.2021 was issued during the lifetime of the assessee, the eventual reassessment action was commenced on the basis of notice under Section 148A (b) dated 26.05.2022 which resulted in issuance of impugned notice under Section 148 of the Act dated 30.07.2022.
Admittedly, both the impugned notices dated 26.05.2022 and 30.07.2022 are in the name of the deceased person.
Petitioner had duly informed the Department about the death of the assessee and had even furnished the particulars of the legal heirs on the Income Tax Portal.
Having derived knowledge of the death of the assessee and the particulars of the legal heirs, it was incumbent upon the respondents who have taken remedial measures by revising the notice in the name of the legal heirs, which admittedly, has not been done in the present case. Since the petitioner had already informed the Department about the death of the deceased, his participation in the reassessment proceedings cannot be regarded as waiver or submitting to the jurisdiction of the Assessing Officer without objection.
The notice under Section 148A (b) dated 26.05.2022 therefore suffers from a fundamental jurisdictional error, having been issued in the name of a dead person. Not only this, the proceedings initiated consequent to such notice have also been proposed in the name of a dead person. No steps were taken to bring the legal heirs of the deceased on record even at the time of issuance of final notice under Section 148 of the Act dated 30.07.2022.
Hence, on the touchstone of the principles that emerge from the judicial pronouncements discussed above, in the facts and circumstances of this case, we are of the view that action under Section 148 cannot be initiated as the impugned notice under Section 148A (b) dated 26.05.2022, impugned order under Section 148A (d) and the impugned notice under Section 148 of the Act, both even dated 30.07.2022 for the AY 2015-16 cannot be sustained and are set aside.
In above case, Delhi HC has relied upon the following cases:
Sumit Balkrishna Gupta v. Asst. CIT [2019] 414 ITR 292 (Bom)
Chandresh Jayantibhai Patel v ITO [2019] 413 ITR 276 (Guj)
Sangeeta Goyal v. Commissioner of Customs (Exports), WP (C) 13025/2019 and Meenu Gupta (Legal Heir of late Sh. Vipin Gupta v. Assistant Commissioner of Income Tax, Circle 67(1), Delhi & Ors. WP (C) 10162/2024.
