Case Note & Summary
The petitioner, Deepak Ashokkumar Soni, is the son and legal heir of late Ashokkumar Harakhchand Soni, who died on 15.03.2024. The petitioner applied to be registered as the legal heir on 11.07.2024, which was approved on 12.07.2024. He then filed the Return of Income for the deceased for Assessment Year 2024-25 on 20.07.2024, declaring total income of Rs.9,08,700/-, which was processed under Section 143(1) of the Income Tax Act, 1961. Meanwhile, scrutiny assessment proceedings for Assessment Year 2023-24 had been initiated against the deceased via a notice under Section 143(2) dated 27.06.2024, which was issued after the death of the assessee. During these proceedings, the petitioner appeared and submitted documents. However, the Assessing Officer passed an ex parte assessment order under Section 144 of the Act on 30.09.2024, making certain additions, without giving the petitioner any opportunity of hearing. The petitioner challenged this order by way of a writ petition. The court held that the notice under Section 143(2) issued to a dead person is void ab initio and cannot form the basis of a valid assessment. Further, the legal heir, having been substituted, was entitled to a fresh notice and an opportunity of hearing before any final order. The assessment order was quashed and set aside, and the matter was remanded back to the Assessing Officer to proceed afresh after giving the petitioner a reasonable opportunity of hearing. The court also directed that the petitioner be allowed to raise all contentions and produce evidence.
Headnote
A) Income Tax - Assessment of Deceased Assessee - Notice to Dead Person - Section 159, 143(2), 144, 147 Income Tax Act, 1961 - Notice issued under Section 143(2) to a deceased assessee is void ab initio and cannot be the basis for a valid assessment - The legal heir must be substituted and given an opportunity of hearing before any final order is passed - Held that the assessment order passed without such substitution and hearing is in gross violation of principles of natural justice and is liable to be quashed (Paras 3-4). B) Income Tax - Natural Justice - Opportunity of Hearing - Section 144 Income Tax Act, 1961 - Ex parte assessment under Section 144 without giving notice to the legal heir is unsustainable - The legal heir, having filed the return and e-verified it, was entitled to be heard before any adverse order - Held that the Assessing Officer failed to provide any opportunity to the petitioner before passing the ex parte assessment order, violating natural justice (Paras 3-4).
Issue of Consideration
Whether the assessment order passed against a deceased assessee without substituting the legal heir and without giving him an opportunity of hearing is sustainable in law.
Final Decision
The court allowed the petition, quashed and set aside the assessment order dated 30.09.2024, and remanded the matter back to the Assessing Officer to proceed afresh after giving the petitioner a reasonable opportunity of hearing. The petitioner was permitted to raise all contentions and produce evidence. Rule was made absolute.
Law Points
- Notice issued to a dead person is void ab initio
- Legal heir must be given opportunity of hearing before final assessment
- Section 159 of Income Tax Act
- 1961 mandates substitution of legal representative
- Natural justice requires notice to proper person
