Court’s Decision:
The Calcutta High Court quashed the reassessment proceedings initiated under Sections 148A(b), 148A(d), and 148 of the Income Tax Act, 1961, against a deceased assessee for the assessment year 2020–21. The Court held that issuance of such notices in the name of a dead person was fundamentally invalid and could not be sustained, especially since the legal heir had already come forward in earlier proceedings. The Court directed that all notices and consequential proceedings be set aside.
Facts:
The petitioner approached the High Court challenging three key instruments issued by the Income Tax Department for the assessment year 2020–21: (i) the notice under Section 148A(b), (ii) the order under Section 148A(d), and (iii) the consequential notice under Section 148.
The petitioner had previously filed a writ petition before the same court concerning a notice issued on 18 April 2022 under Section 148 for the assessment year 2018–19. That notice too was issued in the name of the same deceased individual, who had died on 28 April 2021. A Coordinate Bench of the High Court had quashed that notice by order dated 6 June 2022, acknowledging that it had been wrongly issued against a dead person.
Despite that, the tax authorities again initiated fresh reassessment proceedings for a different assessment year—2020–21—issuing notices once more in the name of the same deceased individual. The legal heir of the deceased, the present petitioner, was again forced to challenge the proceedings through a second writ petition.
Issues:
- Whether reassessment proceedings can be initiated against a deceased assessee under the Income Tax Act, 1961.
- Whether the failure of legal heirs to register themselves on the IT portal can justify initiation of proceedings against the deceased.
- Whether prior knowledge of the legal heir by the Assessing Officer, arising from earlier litigation, mandates action only against the legal heir.
Petitioner’s Arguments:
The petitioner contended that the notice dated 28 March 2024 under Section 148A(b), the order dated 19 April 2024 under Section 148A(d), and the consequential notice under Section 148 were all issued in the name of a deceased individual. The petitioner pointed out that this was not the first such instance—an earlier notice for assessment year 2018–19 had been similarly quashed by the High Court after it was demonstrated that it was issued against the same deceased person.
The petitioner argued that the tax department was well aware of the assessee’s death, especially since the earlier proceedings were litigated and decided in the petitioner’s favour. The petitioner further submitted that he had tried to register himself as the legal heir but was unable to do so due to technical constraints on the IT portal.
Respondent’s Arguments:
The Revenue authorities contended that the notices were issued in the name of the deceased because the department was not aware of the names of the legal heirs. It was argued that the portal did not reflect any legal heir for the deceased assessee because no documents had been uploaded or steps taken to register a legal heir profile online. Thus, the Assessing Officer, unable to identify the legal heir, proceeded by issuing notice in the name of the original assessee.
The Revenue took the stand that until the legal heir registered himself and uploaded documents, the system would not recognize him, and thus the notices were legally justifiable.
Analysis of the Law:
The Court reaffirmed the settled position that any reassessment notice issued under Sections 148A(b) or 148 against a deceased person is a nullity in law and non-est from the outset. The Income Tax Act does not empower the department to initiate or continue proceedings against a dead person. Any such notice is void ab initio.
The Court also emphasized that the procedure for registering a legal heir online, while a statutory requirement, cannot override the factual knowledge available to the department—particularly when the legal heir had already been a party in previous litigation and had disclosed the factum of death.
Precedent Analysis:
Although the Court did not explicitly cite case law in this order, the following landmark decisions support the principle upheld in this case:
- Savita Kapila v. ACIT (2020): Delhi High Court held that issuance of notice under Section 148 against a dead person is a jurisdictional defect and not a mere procedural irregularity. Such a notice is void and incapable of being cured.
- Jaydeepkumar Dhirajlal Thakkar v. ITO (2022): Gujarat High Court ruled that once the department is made aware of death, it must proceed only against legal heirs and not continue to issue notices to the deceased.
The present decision is in line with these precedents, even though it independently analyzes the facts without direct citation.
Court’s Reasoning
Justice Raja Basu Chowdhury rejected the Revenue’s explanation as implausible and held:
“The legal heir of the assessee could not have uploaded the details of the legal heir on the portal for the simple reason that he could not have operated the portal on behalf of the dead person.”
The Court observed that the petitioner had already approached the Court in the earlier round of litigation and disclosed the death of the assessee. The Assessing Officer was, therefore, duty-bound to issue any subsequent notice only against the petitioner.
Accordingly, the Court held that the notices issued for the assessment year 2020–21 could not be sustained.
Conclusion
The Calcutta High Court quashed the notice under Section 148A(b) dated 28 March 2024, the order under Section 148A(d) dated 19 April 2024, and the subsequent notice under Section 148, along with all consequential proceedings for the assessment year 2020–21. The writ petition was disposed of with no order as to costs.
Implications
This ruling underscores that the Revenue cannot proceed against a dead person when the fact of death is known and the legal heir has already come forward. The judgment reinforces taxpayer rights and administrative accountability and prevents repeated harassment through mechanically issued reassessment notices.
It also clarifies that procedural difficulties on online portals cannot override the legal requirement of proceeding against the right party.
FAQs
Q1. Can the Income Tax Department issue reassessment notices to a deceased person?
No. Any such notice is void ab initio and has no legal force.
Q2. What if the legal heir has not uploaded documents online?
That does not justify issuing notice to the deceased if the department already has knowledge of the legal heir through earlier proceedings.
Q3. Can the Revenue reinitiate proceedings properly now?
Yes, but only if done in accordance with law, and after issuing fresh notice to the correct legal heir within prescribed time limits.
