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Judgment
ORDER
PER MANISH AGARWAL, AM :
The captioned appeal has been filed at the instance of the legal heir and son of the deceased-assessee (Vijay Kumar) against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, (NFAC) Delhi (‘CIT(A)’ in short) dated 21.11.2025 arising from the assessment order passed by the Assessing Officer dated 21.01.2022 under Section 147 r.w.s. 144B of the Income Tax Act (‘the Act’ in short) for AY 2013 -14.
As per the grounds of appeal, the assessee has challenged the addition made u/s 68 of the Act of Rs. 32,81,176/- on account of alleged bogus long term capital gains from the sale of shares of M/s CCL International L td, a penny stock in the reassessment order passed u/s 147 r.w.s. 144B of the Act.
When the matter was called for hearing, the ld. counsel for the assessee challenged the issue of jurisdictional notice issued under Section 148 of the Act on the dead person and also the consequent reassessment order passed against the dead person (late Shri Vijay Kumar) on his PAN without bringing on record of his legal representatives. The ld. counsel thus asserts that the issue of notice under Section 148 which confers the jurisdiction for framing reassessment under Section 147 is void ab initio as it is issued in the name of deceased person and hence the consequent reassessment order are also null and void and thus deserves to be quashed at the threshold.
Per contra, the ld. DR for the Revenue submits that in the event an adverse view is taken, the matter should be remanded back to the Assessing Officer for framing the assessment in the hands of the legal heir.
We have carefully considered the rival submissions a nd perused the material on record. The appellant – Manish Agarwal is son of late Shri Vijay Kumar. The assessee namely, Vijay Kumar expired on 15.04.2017 and thereafter no ITR was filed. The son of the assessee also registered himself as legal heir of the deceased-assessee on the website of Income Tax Department and filed the return of income in the capacity of Legal Hier on 21.04.2021 in response to notice u/s 148 issued in the name of his deceased father . However, despite of this fact, notice under Section 143(2) dated 08.10.2021 was issued by the AO in the name of the deceased assessee and the jurisdiction to assess the income of the deceased assessee u/s 147 was assumed. Under the circumstances, where the assessee has died prior to issue of notice u/s 148 and necessary steps were taken on behalf of the legal heir of the assessee and the Department was made aware of the death, the issuance of notice u/s 148 and further u/s 143(2) in the name of the dead person is void ab initio and devoid of legal sanction.
The Hon’ble Delhi High Court in the case of Dharamraj vs. ITO in WP (C) 9227/2021 vide order dated 17.10.2022 has examined the issue in length and held that the notice issued against a death person is null and void and all consequent proceedings/orders passed being equally tainted are liable to be set aside. The relevant operative paragraph in Dharamraj’s case is reproduced herein for the sake of completeness of the point.
“8.The issue of validity of a notice and proceedings held subsequent thereto against a dead person is no longer res integra. This Court in Savita Kapila vs. Assistant Commissioner of Income -T ax, in W.P. (C) No.3258/2020 has held as under:
"AN ALTERNAT IVE STATUTORY REMEDY DOES NOT OPERATE AS A BAR TO MAINTAINABIL ITY OF A WR IT PET IT ION WHERE THE ORDER OR NOT ICE OR PROCEEDINGS ARE WHOLLY WITHOUT JURISDIC T ION. IF THE ASSESSING OFF ICER HAD NO JURISD ICT ION TO INIT IATE ASSESSMENT PROCEEDINGS. THE MERE FACT THAT SUBSEQUENT ORDERS HAVE BEEN PASSED WOULD NOT RENDER THE CHA LLENGE TO JURISD ICT ION INFR UCTUOUS.
24.Further, the f act that an assessment order has been passed and it is open to challenge by way of an appeal, does not denude the petitio ner of its righ t to challenge the notic e f or assessmen t if it is without jurisdic tion. If the assump tion of jurisdic tion is wrong, the assessment order passed subsequent would have no legs to stand. If the notice goes, so does the order of assessment. It is trite law that if the Assessing Of f icer had no jurisdic tion to initiate assessment proceeding, the mere f act that subsequent orders have been passed would not render the challenge to jurisdic tion inf ructuous. xxxxx
THE SINE QUA NON FOR ACQU IRING JURISD ICT ION TO REOPEN AN ASSESSMENT IS THAT NOT ICE UNDER SECT ION 148 SHOULD BE ISSUED TO A CORRECT PERSON AND NOT TO A DEAD PERSON. CONSEQUENTLY. THE JURISD ICT IONAL REQUIREMENT UNDER SECT ION 148 OF THE ACT. 1961 OF SERV ICE OF NOT ICE WAS NOT FULFILLE D IN THE PRESENT INSTANCE. xxxxx
26.In the opinion of this Court the issuance of a notice under Section 148 of the Act is the f oundation f or reopening of an assessmen t. Consequently, the sine qua non f or acquiring jurisdic tion to reopen an assessment is that such no tice should be issued in the name of the correct person. This requiremen t of issuing notice to a correct person and not to a dead person is not merely a procedural requirement bu t is a condition precedent to the impugned notice being valid in law. [See Sumit Balkrishna Gupta v. As st Commissioner of Income Tax, Circle 16(2), Mumbai & Ors., (2019) 2 TMI1209 - Bombay High Court],
27.xxxxx Consequently, in vie w of the above, a reopening notice under Sec tion 148 of the Act, 1961 issued in the name of a deceased assessee is null and vo id. XXXX.XX AS IN THE PRESENT CASE PROCEEDINGS WERE NOT IN IT IATED/PEND ING AGAINST THE ASSESSEE WHEN HE WAS AL IVE AND AFTER HIS DE ATH THE LEGAL REPRESENTATIVE DID NOT STEP INTO THE SHOES OF THE DECEASED ASSESSEE. SECTION 159 OF THE ACT. 1961 DOES NOT APPL Y TO THE PRESENT CASE.
30.Section 159 of the Act, 1961 applies to a situation where proceedings are initiated/pending ag ainst the assessee when he is alive and af ter his death the legal representative steps in to the shoes of the deceased assessee. Since that is not the present f actual scenario, Section 159 of the Ac t, 1961 does not apply to the present case.
31.xxxxx THERE IS NO STATUTORY REQUIREMENT IMPOS ING AN OBL IGAT ION UPON LEGAL HE IRS TO INT IMATE THE DEATH OF THE ASSESSEE.
32.This Court is of the vie w that in the absence of a statu tory provision it is diff icult to cas t a duty upon the leg al representatives to intimate the f actum of death of an assessee to the income tax depar tment. Af ter all, there may be cases where the leg al representatives are estranged f rom the deceased assessee or the deceased assessee may have bequeathed his entire wealth to a charity. Consequently, whe ther PAN record was updated or not or whether the Departmen t was made aware by the leg al representativ es or not is irrelevan t. In Alamelu Veerappan (supra) [2018 (6) TMI 760 - Madras High Court] it has been held“no thing has been placed bef ore this Court by the Revenue to show that th ere is a s tatu tory oblig ation on the part of the leg al represen tatives of the deceased assessee to immediately intimate the death of the assessee or take steps to cancel the PAN reg is tration. ” xxxxx
34.Consequently, the legal heirs are under no statu tory oblig ation to intimate the death of the assessee to the Revenue. SECT ION 292B OF THE ACT. 1961 HAS BEEN HELD TO BE INAPPLICABLE. V IS -A- V IS. NOT ICE ISSUED TO A DEAD PERSON IN RAJENDER KUMAR SEHGAL 12018 (12) TMI 697 (DELHI)]. CHANDRESHBHAI JAYANTIBHA IPATEL 12019 (I) TMI353 - GUJARAT HIGH COURT1 AND ALAMELU VEERAPPAN f 2018 (6) TM I 760 - MADRAS HIGH COURT1.
35.This Court is of the opinion that issuance of notice upon a dead person and non -service of notice does not come under the amb it of mistake, def ect or omission. Consequently, Section 292B of the Ac t, 1961 does not apply to the presen t case.
IN RAJ INDER KUMAR SEHGAL (SUPRA) A COORDINATE BENCH OF THIS COURT HAS HELD THAT SECTION 292BB OF THE ACT 1961 IS APPL ICABLE TO AN ASSESSEE AND NOT TO A LEGAL REPRESENTAT IVE. xxxxx
38.This Court is also of the vie w that Section 292BB of the Act, 1961 is applicable to an assessee and not to a legal representative. Further, in the present case one of the legal heirs of the deceased assessee, i.e. the petitioner, had neither cooperated in the assessmen t proceedings nor f iled return or waived the requiremen t of Section 148 of the Act, 1961 or submitted to jurisdic tion of the Assessing Off icer. She had merely uploaded the death certif icate of the deceased assessee. Xxxxxx
40.Consequently, the applicability of Section 292BB of the Act, 1961 has been held to be attracted to an assessee and not to leg al representatives. ”
9.The above judg ment was f ollowed by this Court in W.P.(C) No.2678/2020 titled Mrs. Sripathi Subbaraya Manohara L/H Late Sripathi Subbaraya Gup ta vs. Principal Commissioner of Income Tax 22, N.Delhi & Anr.
10.In the present case also, as the no tice under Section 148 of the Act was issued ag ains t a dead person, the same is null and void and all consequent proceeding s/orders, including the assessmen t order and the subsequent n o tices, being equally tainted, are liable to be set aside.
11.Consequently, the impugned notice dated 30.03.2019 issued under Section 148 of the Ac t is set aside along with all consequential proceedings/notices/assessmen t orders.
12.The petition is allowed. There shall be no order as to costs.”
The Hon’ble Delhi High Court has earlier expressed the aforesaid view in Braham Prakash vs. ITO reported in 275 ITR 242 (Del). Similar view has been consistently expressed in plethora of other judgments of different High Courts as well as Co-ordinate Benches of Tribunal.
In terms of the explicit observations made in the aforesaid judgment of the Hon’ble Delhi High Court, we f ind considerable merit in the preliminary grounds raised on behalf of the legal heir for the assessee that the entire proceedings beginning from issuance of notice u/s 148 and culminating in reassessment order passed u/s 147 r.w.s. 144B of the Act is a nonest exercise and cannot be given effect in law and the same is thus quashed.
In view of this finding that the reassessment order in question itself is found to be bad in law, other grounds on aspects of merits are not required to be looked into.
In the result, the appeal of the assessee is allowed.