GST Demand Against Deceased is Invalid; Notice to Legal Heir is Mandatory.

Issue

Whether a GST demand proceeding can be validly initiated and a final order passed against a proprietor who is already deceased, or if the proceedings must be directed against their legal representative to be legally sustainable.

Facts

The proprietor of a business, in whose name the GST registration stood, had passed away.
After her death, the proper officer initiated demand proceedings under Section 73.
A show-cause notice, reminders, and a final order determining tax liability were all issued in the name of the deceased proprietor and uploaded to the GST portal.
The proceedings were conducted without any notice being served on the petitioner, who was the husband and legal representative of the deceased.
The legal representative challenged the final order, arguing that a proceeding against a dead person is a nullity in law.
The Revenue defended its action by citing Section 93 of the CGST Act, which makes the legal representative liable for the tax dues of a deceased person.

Decision

The High Court quashed and set aside the impugned demand order.
It held that a proceeding initiated and an order passed against a dead person are legally unsustainable and void ab initio.
The court clarified that while Section 93 establishes the liability of a legal representative to pay tax from the deceased’s estate, it does not authorize the tax department to initiate proceedings against a person who is no longer alive.
The correct and mandatory procedure (sine qua non) is to issue the show-cause notice to the legal representative, thereby giving them a proper opportunity to respond and defend the case.
The department was left at liberty to initiate fresh proceedings against the legal representative in accordance with the law.

Key Takeaways

No Proceedings Against the Dead: It is a fundamental legal principle that legal proceedings cannot be initiated or continued against a deceased person. Any such action is a nullity from its inception.
Notice to Legal Heir is Non-Negotiable: To enforce a tax liability of a deceased person against their estate, the tax authorities must bring the legal representative on record. This requires serving a valid show-cause notice directly on the legal representative.
Section 93 Defines Liability, Not Procedure: Section 93 of the CGST Act is a provision that fastens the liability onto the legal heir; it does not provide a procedural shortcut to bypass the principles of natural justice by raising a demand against a dead person.
Jurisdictional Defect: Passing an order against a deceased individual is not a mere procedural irregularity but a fundamental jurisdictional defect that renders the entire proceeding invalid.

HIGH COURT OF ALLAHABAD

Om Prakash Wadhawan

State of U.P.

Shekhar B. Saraf and Prashant Kumar, JJ.

WRIT TAX No. 1032 of 2025

OCTOBER 7, 2025

Pushpila Bisht, Amrendra Ashok and Jai Priya Swapnil for the Petitioner.

ORDER

1. This petition is directed against order dated 14.08.2024 passed under Section 73 of the Goods and Services Tax Act, 2017 (for short ‘the Act’) wherein a demand of Rs.5,52,584.98/- has been raised in the name of Sangeet Wadhawan.

2. The petitioner Om Prakash Wadhawan, husband of deceased Sangeet Wadhawan has filed the petition inter alia with the submissions that Sangeet Wadhwan had died on 02.10.2022. The GST registration of the proprietorship firm M/s Krishna Electonics was in the name of deceased. Whereafter a show cause notice dated 14.05.2024 was issued in the name of deceased under Section 73 of the Act. However, as the same was uploaded on the portal, there was no occasion for the petitioner to have accessed the said portal, the show cause notice remained unanswered which resulted in passing of the order dated 14.08.2024 raising demand against the deceased.

3. Submissions have been made that once the Department was well aware of the fact that proprietor of the firm has already died and the registration of the firm has already been cancelled, there was no occasion for passing the order in the name of the deceased and as the proceedings have been conducted in the name of the deceased, the same are void ab initio and, therefore, the order impugned deserves to be quashed and set aside.

4. Learned counsel for the respondents supported the order impugned with the aid of provisions of Section 93 of the Act. Submissions have been made that under the provisions of Section 93, the recovery can be made from the legal representatives even after the determination has been made after the death of the proprietor of the firm.

5. We have considered the submissions made by counsel for the parties and have perused the material available on record.

6. Undisputed facts are that the show cause notice, reminders and determination of tax have been made after the death of the proprietor of the firm. Provisions of Section 93 of the Act, insofar as relevant, reads as under:

“93. Special provisions regarding liability to pay tax, interest or penalty in certain cases:

(1) Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016 (31 of 2016), where a person, liable to pay tax, interest or penalty under this Act, dies, then –

(a) if a business carried on by the person is continued after his death by his legal representative or any other person, such legal representative or other person, shall be liable to pay tax, interest or penalty due from such person under this Act; and

(b) if the business carried on by the person is discontinued, whether before or after his death, his legal representative shall be liable to pay, out of the estate of the deceased, to the extent to which the estate is capable of meeting the charge, the tax, interest or penalty due from such person under this Act,

whether such tax, interest or penalty has been determined before his death but has remained unpaid or is determined after his death.”

7. A perusal of the above provision would reveal that the same only deals with the liability to pay tax, interest or penalty in a case where the business is continued after the death, by the legal representative or where the business is discontinued, however, the provision does not deal with the fact as to whether the determination at all can take place against a deceased person and the said provision cannot and does not authorise the determination to be made against a dead person and recovery thereof from the legal representative.

8. Once the provision deals with the liability of a legal representative on account of death of the proprietor of the firm, it is sine qua non that the legal representative is issued a show cause notice and after seeking response from the legal representative, the determination should take place.

9. In view thereof, the determination made in the present case wherein the show cause notice was issued and the determination was made against the dead person without issuing notice to the legal representative, cannot be sustained.

10. Consequently, the writ petition is allowed. The order dated 14.08.2024 (Annexure-1 to the writ petition) is quashed and set aside. The respondents would be free to take appropriate proceedings in accordance with law.