In a significant ruling, Delhi High Court sets aside an income tax notice due to the failure to involve the legal heirs of the deceased in the proceedings, emphasizing that issuing notices in the name of the deceased was inherently flawed and invalid.
The petitioner, son of the late Vijay Shankar Goel, challenged the issuance of a notice under Section 148A(b) of the Income Tax Act, 1961, dated 26.05.2022, and the subsequent order under Section 148A(d) and notice under Section 148, both dated 30.07.2022, for the Assessment Year (AY) 2015-16.
The deceased assessee, Vijay Shankar Goel, had filed his return for AY 2015-16 on 31.10.2015. A notice under Section 148 was issued to him on 08.04.2021, but he passed away on 10.05.2021. After his death, the petitioner, as the legal heir, filed the income tax return on 29.05.2021. Despite being informed about the death of the assessee, the Income Tax Department continued issuing notices in the deceased’s name, including a Section 143(2) notice. The petitioner repeatedly informed the Department about the death and provided details of the legal heirs, which were approved on 08.10.2021.
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However, further notices, including under Section 148A(b), were issued in the deceased’s name. The petitioner, acting as the legal heir, participated in the proceedings but maintained that these notices were invalid as they were issued to a dead person. The Income Tax Department argued that the proceedings had commenced during the lifetime of the deceased, and the legal heirs’ participation validated the process.
The Delhi High Court, citing legal precedent, including Income Tax Officer Ward 1(3)(7), Surat v. Durlabhbhai Kanubhai Rajpara, held that notices issued to a dead person are invalid. The Court noted that despite knowledge of the death and the details of the legal heirs, the department failed to revise the notices in the name of the legal heirs. The petitioner’s participation in the proceedings did not amount to a waiver of his rights or submission to the jurisdiction of the Assessing Officer.
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The division bench comprising Justice Ravinder Dudeja and Justice Yashwanth Varma ruled that the notices dated 26.05.2022 and 30.07.2022, issued in the deceased’s name, were fundamentally flawed and invalid. Consequently, the reassessment proceedings based on these notices were quashed, and the notices were set aside.
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