GST Demands and Notices Issued Against a Deceased Sole Proprietor Are Void and Quashed

By | November 4, 2026
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GST Demands and Notices Issued Against a Deceased Sole Proprietor Are Void and Quashed

Issue

Whether GST tax demand proceedings, show cause notices (SCN), and assessment orders issued in the name of a deceased sole proprietor—despite the tax authorities having prior knowledge of the proprietor’s death—are legally sustainable and within jurisdiction.

Facts

  • Closure and Death: A sole proprietorship registered under the CGST Act closed its business in April 2019, and the sole proprietor subsequently passed away on 21-04-2020.
  • Cancellation Application: The legal heir applied for registration cancellation in Form GST-REG-16 on 08-12-2021, disclosing the death, which led to retrospective cancellation of registration and filing of final return GSTR-10.
  • Prior Proceedings: Despite knowledge of the death, the authorities previously issued a DRC-01A and SCN in 2023, followed by a DRC-07 demand order in April 2024, against which an appeal was filed by the legal heir in June 2024.
  • Fresh Impugned Proceedings: For the same period, the authorities again issued a DRC-01A on 23-06-2025 and an SCN on 27-06-2025 in the name of the deceased, culminating in a DRC-07 order passed on 15-12-2025.
  • Writ Challenge: The legal heir filed a writ petition challenging the 2025 DRC-01A, SCN, and DRC-07 order.

Decision

  • Proceedings Against Deceased Void: Tax proceedings, notices, and orders initiated against a dead person are a nullity and lack jurisdiction, especially when authorities are fully aware of the death. (Paras 7 & 8)
  • Quashing of Impugned Actions: The impugned DRC-01A dated 23-06-2025, SCN dated 27-06-2025, and DRC-07 order dated 15-12-2025 were quashed and set aside. (Para 8) (In favour of assessee)
  • Liberty to Proceed Legally: The Court reserved liberty for the revenue to initiate fresh action strictly in accordance with law against the legal heir under statutory provisions like Section 93, expressing no opinion on the merits. (Para 8)

Key Takeaways

  • Legal Incompetence of Notices Issued to Deceased: Notices and assessment orders issued under the GST Act in the name of a deceased taxpayer are void ab initio and cannot sustain legal scrutiny.
  • Obligation to Proceed Against Legal Heirs: Where tax liabilities survive against a deceased sole proprietor, authorities must follow proper statutory procedures under Section 93 to issue notices and frame assessments against the legal representative rather than the dead individual.
HIGH COURT OF GUJARAT
Dipakkumar Nathalal Raichura
v.
State of Gujarat
A.S. Supehia and Ms. Vaibhavi D. Nanavati, JJ.
R/SPECIAL CIVIL APPLICATION NO. 8888 of 2026
OCTOBER  14, 2026
Hiren J. Trivedi for the Petitioner. Ms. Kinjal Vyas, AGP for the Respondent.
ORDER
A.S. Supehia, J. – At the outset, learned advocate Mr. Hiren Trivedi appearing for the petitioner has fairly pointed out that at this stage, prayer at paragraph no. 25(B) is not pressed, in view of the parallel proceedings since the appeal is pending from the proceedings arising from Section 74 of the Central Goods and Services Tax Act, 2017 (for short ‘CGST Act’). However, he has submitted that all the rights and contentions of the legal heir may be kept open. We agree to the aforesaid proposition, so far as prayer at paragraph no. 25(B) is concerned.
2. Thus, the present writ petition is confined to prayer at paragraph no.25(A), wherein the petitioner has assailed the intimation in Form DRC-01A dated 23.06.2025 and the show- cause notice dated 27.06.2025 and the order in Form DRC-07 dated 15.12.2025.
3. It is the case of the petitioner, that the impugned show- cause notice as well as the order are required to be quashed and set aside as the proceedings under Section 74 of the CGST Act has been initiated against the deceased-father of the petitioner i.e. late Shri Nathalal Keshavbhai Raichura, who passed away on 21.04.2020. The father of the petitioner i.e. Shri Nathalal Raichura was the sole proprietor of M/s. Balkrishan Cotspin and the registered taxable person. It is the case of the petitioner that after demise of the deceased the operation of the proprietorship firm ended in April 2019 and “nil” GST returns were regularly filed. The petitioner, being the legal heir, filed an application in Form GST-REG-16 on 08.12.2021, seeking cancellation of registration on account of closure of business.
4. Pursuant to the aforesaid application the respondent authority issued a notice dated 15.12.2021 seeking clarification on additional documents in respect of cancellation of registration. Thereafter, the application filed by the petitioner came to be rejected on 19.01.2022 by the respondent-authority, which, prompted the petitioner to file a fresh application seeking cancellation of registration on 21.01.2022. However, the same was withdrawn due to technical error on the GST Portal. The petitioner thereafter filed third application on 25.01.2022, praying for cancellation of registration. A detailed reply was also filed on 27.01.2022, manually before the authority specifically mentioning that the sole proprietor was his father, had passed away and that the petitioner had also annexed the death certificate along with supporting documents.
5. On 16.04.2022 the respondent-authority accepted the application for cancellation of the GST registration with retrospective effect from 31.12.2021 without raising any liability or discrepancy. The final return under Form GSTR-10 under Section 45 of the CGST Act was duly filed by the petitioner on 25.04.2022. It appears that after passage of three years from the death of the proprietor on 22.09.2023, the respondent-authority had issued Form DRC-01A dated 22.09.2023 proposing demand under Section 74 of the CGST Act for alleged wrongful availment of input tax credit. A Show-Cause Notice dated 07.12.2023 was also issued against the name of the deceased proprietor. The petitioner under bona fide belief filed a detailed reply on 13.03.2024 demonstrating genuineness of transaction and contesting the demand, though the proceedings were initiated in the name of the deceased. The respondent-authority passed an order under Form DRC-07 dated 03.04.2024, confirming the demand which had resulted in filing an appeal by the petitioner in APL-01 dated 07.06.2024 as a legal heir.
6. Again the respondent-authority passed a fresh intimation under DRC-01A dated 23.06.2025 for the same period and issued alleged input tax credit, once again in the name of the deceased person fresh Show-Cause Notice dated 27.06.2025 also issued by alleging wrongful availment of the input tax credit. The petitioner through his tax consultant filed detailed reply on 07.07.2025 bring on record the death of the proprietor and objecting to continuation of the proceedings. On 15.12.2025 the respondent authorities passed the order under Form DRC-07 dated 15.12.2025 confirming demand. The aforenoted facts are not disputed.
7. Thus, when the fresh intimation in Form DRC-01A was passed on 23.06.2025 alleging wrongful availment of input tax credit, the respondent-authority was already aware about the death of the proprietor. However, the same has been passed and issued in the name of the deceased person. Thus, on the ground of this lack of jurisdiction by the revenue authority to initiate the proceedings against the deceased, the impugned action calls for interference. Though the petitioner having pointed out the fact of death of his father right from 08.12.2021, when he filed application seeking cancellation of registration on closure of business and thereafter also on the issuance of the show-cause notice dated 22.09.2023, when DRC-01 was issued proposing demand under Section 74 of the CGST Act, which culminated into filing an appeal by the petitioner on 07.06.2024, in the capacity of legal heir, the impugned Notice has been issued. Thus, the respondent-authority could have noticed that appeal has been filed by the petitioner being a legal heir, hence, fresh intimation under Form DRC-01A dated 23.06.2025 to the deceased was uncalled for.
8. Under these undisputed facts, since the proceedings are initiated against a deceased proprietor, the impugned intimation in Form DRC-01A dated 23.06.2025 and the show-cause notice dated 27.06.2025 and the order in Form DRC-07 dated 15.12.2025 are hereby quashed and set aside. However, we reserve liberty in favour of the respondent-authority to initiate proceedings as permissible under the law, against the legal heir i.e. the present petitioner-Dipakkumar Nathalal Raichura.
9. We clarify that we have not opined anything on merits of the case. The rights and contentions of the respective parties