Facts of the Case

  • The Income Tax Department issued a notice dated 22.03.2019 under Section 148 for reopening assessment for AY 2012-13.
  • Subsequently, assessment order dated 14.11.2019 and penalty notices were passed.
  • These proceedings were initiated in the name of Late Sripathi Subbaraya Gupta, who had already died on 17.06.2014.
  • The petitioner (legal heir) became aware of the proceedings only upon receipt of assessment order and penalty notices.
  • The Department argued that it had information regarding cash deposits of ₹11,55,000, leading to reopening of assessment.

Issues Involved

  1. Whether a notice under Section 148 issued in the name of a deceased person is valid in law?
  2. Whether availability of alternative remedy (appeal) bars writ jurisdiction?
  3. Whether legal heirs are obligated to inform the department about death of assessee?
  4. Applicability of Sections 159, 292B, and 292BB in such cases.

Petitioner’s Arguments

  • The reassessment notice issued to a dead person is void ab initio and all subsequent proceedings are non-est.
  • Relied on Savita Kapila vs ACIT (Delhi High Court).
  • Legal heirs were not aware of proceedings and cannot be bound by invalid jurisdictional notice.

Respondent’s Arguments

  • The petition is not maintainable due to availability of alternative remedy (appeal).
  • The department was unaware of the death of the assessee.
  • Reopening was based on credible information of undisclosed income.

Court’s Findings / Order

  • The Court held that:
    • Notice under Section 148 issued to a deceased person is null and void.
    • Such notice is a jurisdictional defect, not a procedural irregularity.
    • If the notice is invalid, all consequential proceedings including assessment order also fail.
  • The Court rejected the objection regarding alternative remedy, holding that:
    • Writ is maintainable when proceedings lack jurisdiction.
  • Final Order:
    • Impugned notices and assessment order were quashed.

Important Clarifications by Court

  • Issuance of notice to correct person is sine qua non for jurisdiction under Section 148.
  • Section 159 (Legal Representatives) applies only if proceedings were initiated during lifetime of assessee.
  • No statutory obligation on legal heirs to inform the department about death.
  • Section 292B does NOT cure defect of notice issued to dead person.
  • Section 292BB applies only to assessee, not legal heirs.

Sections Involved

  • Section 147 – Income escaping assessment
  • Section 148 – Issue of notice for reassessment
  • Section 144 – Best judgment assessment
  • Section 274 – Penalty procedure
  • Section 271(1)(c) – Penalty for concealment
  • Section 271F – Penalty for failure to file return
  • Section 159 – Legal representatives
  • Section 292B – Return of income, etc., not to be invalid on technical grounds
  • Section 292BB – Notice deemed to be valid

Link to download the order -https://delhihighcourt.nic.in/app/case_number_pdf/2021:DHC:2051-DB/NAC14072021CW26782020_182606.pdf


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