Reassessment Proceedings Initiated Against Deceased Assessee

Reassessment Proceedings Initiated Against Deceased Assessee Without Serving Notice on Legal Representatives Are Void

Issue

Whether reassessment proceedings initiated under Section 148 against a deceased assessee—and completed ex parte without issuing notice to the legal representatives under Section 159—are bad in law and liable to be quashed.

Facts

Assessment Year: 2011-12.
Property Sale: The deceased individual assessee sold a property during the relevant financial year but filed no return of income as total income was below the taxable threshold.
Information & Reopening: The Assessing Officer received information that the property was sold for Rs. 4.90 lakhs against a stamp duty value of Rs. 17.69 lakhs, and issued a Section 148 reopening notice directly in the name of the deceased assessee.
Submission by Legal Heir: One of the legal heirs appeared before the Assessing Officer and submitted the death certificate and legal heir certificate, clarifying that the land was agricultural land acquired in 1982 with no taxable capital gains.
Ex Parte Assessment: Ignoring the legal heir’s submissions, the Assessing Officer proceeded ex parte to pass a reassessment order under Section 147 read with Section 144 in the name of the deceased assessee, merely listing the legal heir’s name below.
Tax Addition: The Assessing Officer treated the land as a taxable capital asset, applied Section 50C to adopt the stamp duty valuation of Rs. 17.69 lakhs, and computed long-term capital gains (LTCG).

Decision

Held in favor of the assessee.
A Section 148 notice issued to a person who had already expired prior to its issuance is issued against a non-existing person and is void ab initio.
Since the Assessing Officer failed to initiate reassessment proceedings afresh against the legal representatives in accordance with Section 159, the resulting ex parte reassessment order was bad in law and liable to be quashed.

Key Takeaways

Notice on Deceased Person Is Void Ab Initio: The issuance of a reassessment notice under Section 148 to a deceased assessee goes to the root of jurisdiction; proceedings against a non-existing person are legally non-est.
Mandatory Service on Legal Representatives: Once informed of the assessee’s death, the Assessing Officer must issue statutory notices directly to all legal representatives under Section 159 to assume valid jurisdiction.
Mere Reference to Legal Representative Insufficient: Simply mentioning the name of a legal heir at the bottom of an assessment order passed in the deceased person’s name does not cure the jurisdictional defect of a invalid Section 148 notice.

IN THE ITAT CHENNAI BENCH ‘A’

Kuppusamy Tharmaraj Pakkirisamy

Income-tax Officer

GEORGE GEORGE K., Vice President
and S.R. Raghunatha, Accountant Member

IT Appeal No. 3388 (CHNY) of 2025
[Assessment year 2011-12]

SEPTEMBER 11, 2026

Bharat Janarthanan, Adv. for the Appellant. Ms. Anshu Sharawat, Addl.CIT for the Respondent.

ORDER

George George K., Vice President.- This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 29.01.2025 passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2011-12.

2. There is a delay of 237 days in filing the appeal. The assessee has filed an affidavit seeking condonation of delay stating therein the reasons for delay. It is submitted that the assessee is one of the six legal heirs of the deceased appellant, Late T. Arumaikannu, in whose case an order u/s.144 r.w.s. 147 of the Act was passed on 10.12.2018. The assessee alone initially pursued the proceedings before the Assessing Officer and thereafter filed an appeal before the CIT(A)-NFAC, who, vide order dated 29.01.2025, remanded the matter to the file of the AO. It is submitted that, thereafter, disputes arose amongst the legal heirs regarding sharing of the responsibility and financial burden of pursuing the proceedings. Despite the assessee’s efforts, the other legal heirs did not extend the necessary cooperation or support. Further, the deceased appellant had left no estate from which any liability, if ultimately crystallised, could be discharged. In these circumstances, the assessee was initially hopeful of securing the cooperation of the other legal heirs, but such efforts did not yield any result. Ultimately, the assessee took upon himself the responsibility of pursuing the matter and filed the present appeal, resulting in the delay of 237 days. Accordingly, it is prayed that the delay may kindly be condoned and the appeal be admitted for adjudication on merits. On perusal of the reasons stated, we are of the view that no latches can be attributed to the assessee as there is sufficient cause for belated filing of this appeal. Hence, we condone the delay and proceed to dispose off the appeal on merits.

3. Brief facts of the case are as follows: The assessee is an individual who had expired on 02.05.2013. For the assessment year 2011-12, no return of income was filed by the assessee. The Department had information that assessee had sold a property for consideration of Rs.4,90,000/- as against the government guideline value of Rs.17,69,000/-. Accordingly, notice u/s.148 of the Act was issued on 28.03.2018. Since there is no response, the AO issued notices u/s.142(1) of the Act and show-cause notices. Since there is no reply to the show-cause notices, assessment was completed u/s.144 r.w.s.147 of the Act vide order dated 10.12.2018. In the said assessment order, the AO calculated the Long-Term Capital Gain on sale of property at Rs.16,11,843/-. The assessment order has been passed in the name of Late Smt. T. Arumaikannu represented by Legal Heir Shr K.T. Pakkirisamy.

4. Aggrieved, assessee’s legal representative filed appeal before the First Appellate Authority (FAA). Before the FAA, on merits, it was contended that the property sold was agricultural land and, therefore, not liable to be taxed. On the legal issue, it was contended that the AO erred in passing the impugned assessment order in the name of the deceased assessee and the mere mention of one of the legal heirs followed by the name of the deceased would not satisfy the requirement that the impugned order ought to have been passed in the names of all the legal heirs. The FAA, however, without adjudicating the aforesaid legal ground, restored the matter to the file of the AO on the ground that the assessment proceedings before the AO were ex-parte.

5. Aggrieved by the order of the FAA, the assessee has filed the present appeal before the Tribunal. The grounds raised before the Tribunal reads as follows:-

1. The order of the Leamed Commissioner of Income-Tax (Appeals)-National Faceless Appeal Centre [“CIT(A)-NFAPC” is contrary to the facts and circumstances of the case and is against the principles of equity and natural justice.

2. The Leamed CIT(A)-NFAPC erred in passing the impugned order dated 29.01.2025 remanding the matter back to the file of the assessing officer when infact, the CIT(A)-NFAPC ought to have decided the appeal on its merits, more particularly, on the legal issues raised by the appellant qua the validity of the order under section 144 r.w. 147 of the Act dated 10.12.2018.

3. The Learned CIT(A)-NFAPC erred in passing the impugned order dated 29.01.2025 remanding the matter back to the file of the assessing officer when infact, the CIT(A)-NFAPC ought to have decided the appeal on the issue relating to validity of notice under section 148 dated 28.03.2018 in the name of the dead person late T. Arumaikannu [“deceased appellant”| as it was purely a legal issue which did not involve any factual verification warranting a remand and therefore, the impugned order of the CIT(A)-NFAPC deserves to be set aside

4. The Learned CIT(A)-NFAPC erred in passing the impugned order dated 29.01 2025 remanding the matter back to the file of the assessing officer without adjudicating on the validity of the order under section 144 r.w. 147 of the Act dated 10.12.2018 when infact, the said order is invalid as the notice under section 148 of the Act dated 28.03.2018 is not valid as the same was issued in the name of the dead person and it is a settled law that the entire proceeding under section 147 is invalid when notice under section 148 is issued in the name of the dead person and therefore, the CIT(A)-NFPAC ought to have quashed the order of the assessing officer under section 144 r.w. 147 of the Act dated 10.12.2018 instead of remanding the same back to him.

5. The Leamed CIT(A)-NFAPC erred in passing the impugned order dated 29.01.2025 remanding the matter back to the file of the assessing officer when infact, the order under section 144 r.w. 147 of the Act dated 10.12.2018 was passed in the name of the dead person and as the same is invalid, he ought to have quashed the same.

6. The Learned CIT(A)-NFAPC erred in passing the impugned order dated 29.01.2025 remanding the matter back to the file of the assessing officer without adjudicating on the validity of the order under section 144 r.w. 147 of the Act dated 10.12.2018 when infact, the entire reassessment proceeding ought to have been initiated, conducted and the reassessment order under section 147 of the Act ought to have been passed in the names of all the legal heirs, which was not done so in the case under consideration, and therefore, he ought to have quashed the same instead of remanding the matter back to assessing officer.

7. The Learned CIT(A)-NFAPC erred in passing the impugned order dated 29.01.2025 remanding the matter back to the file of the assessing officer when infact, the addition made by the assessing officer under the head “capital gain” qua sale of the agricultural land by the deceased appellant is invalid as the said land is not a “capital asset” as per section 2(14) of the Act and therefore, he ought to have deleted the addition.

6. The Ld. AR submitted that the NFAC erred in remanding the matter to the AO without adjudicating the legal ground challenging the validity of the assessment u/s.144 r.w.s. 147 of the Act. It was contended that the notice u/s.148 dated 28.03.2018 was issued in the name of the deceased assessee, Late Smt. T. Arumaikannu, who had expired on 02.05.2013, and that the AO continued the proceedings in her name even after being apprised of her death and furnished with the death and legal heir certificates. Relying on the judgment of the Hon’ble Jurisdictional High Court in Alamelu Veerappan v. ITO (Madras), and the decision of the Chennai Bench of the Tribunal in Late Palanisamy Gunasekaran v. ITO [IT Appeal No. 228 (Chny) of 2026, dated 02.06.2026], the Ld. AR submitted that the notice issued in the name of the deceased was invalid and the consequent reassessment proceedings were liable to be quashed. Accordingly, it was pleaded that, instead of remanding the matter to the AO, the FAA ought to have adjudicated the legal ground and quashed the assessment order. Without prejudice to the above legal contention, the Ld. AR submitted that the AO had also erred on merits in treating the property sold by the deceased assessee as a capital asset and bringing the resultant gain to tax. It was contended that the property sold was agricultural land and, therefore, did not fall within the definition of “capital asset” u/s.2(14) of the Act. Accordingly, the Ld. AR prayed that the impugned assessment order be quashed on the legal ground and, in the alternative, the addition made towards Long-Term Capital Gain be deleted.

7. The Ld. DR submitted that the assessee having sold the property ought to have filed her return of income for the relevant assessment year namely 2011-12 and having failed to file the return of income, the Department is justified in issuing notice and bringing to tax the sale consideration received as Long-Term Capital Gains. It was stated by the Ld. DR that the Department was not informed about the demise of assessee, hence, the assessment order being passed in the name of deceased by bringing on record one of legal heirs is a valid order.

8. We have heard the rival submissions and perused the material on record. The assessee, Late Smt. T. Arumaikannu, is represented by one of her legal heirs, namely Shri K.T. Pakkirisamy. It is stated that, during the relevant assessment year 2011-12, the assessee sold a property on 02.08.2010 for a consideration of Rs.4,90,000/-. The legal representative contends that the property so sold was agricultural land, which had been purchased by the assessee on 15.08.1982 for a consideration of Rs.20,000/-. It is further submitted that, since the assessee had no taxable income and the sale of the agricultural land did not give rise to taxable capital gains, no return of income was filed under section 139 of the Act for the relevant assessment year.

9. The assessee expired on 02.05.2013 at the age of 70 years. A copy of the death certificate is placed on record at pages 20 and 21 of Paperbook No.1 filed by the assessee. Subsequently, the sons and daughters of the deceased assessee were registered as her legal heirs, as evidenced by the legal heir certificate issued by the Sub-Registrar Office, Tiruvallur, dated 14.08.2013. The details of the legal heirs as recorded in the said certificate are as under:-

Selvanayaki – Daughter

ii.

Murugesan – Son

iii.

Jyothi – Daughter

iv.

Ranganayaki – Son

Kannan – Son

vi.

Pakkirisamy – Son

10. A notice under section 148 of the Act was issued in the name of the deceased assessee on 28.03.2018, nearly five years after her demise. A copy of the said notice is placed on record at page 23 of Paper-book No.1. Subsequently, one of the legal heirs, namely Shri K.T. Pakkirisamy, the appellant herein, appeared before the AO and brought to his notice the factum of the assessee’s death. The appellant also furnished the death certificate as well as the legal heir certificate before the AO. Despite being apprised of the death of the assessee and being furnished with the relevant documents, the AO without complying with the mandate of law to issue the notice u/s.148 of the Act in the name of the surviving legal heir(s), proceeded to issue notices proposing best judgment assessment u/s.144 of the Act in the name of the deceased assessee, with the name of the appellant merely mentioned below it. The AO thereafter completed the assessment by treating the property sold by the deceased assessee as a capital asset and brought the resultant Long-Term Capital Gain to tax. Further, invoking the provisions of section 50C of the Act, the AO adopted the value of the property for stamp duty purposes at Rs.17,69,000/- and, after allowing the indexed cost of acquisition, determined the Long-Term Capital Gain at Rs.16,11,843/-.

11. As noted above, on the date of issuance of the notice under section 148 of the Act, i.e., on 28.03.2018, the assessee had already expired. Therefore, the notice issued under section 148 of the Act in the name of a deceased person was invalid in law, as such notice could have been issued only against a living person or, in accordance with law, upon the legal heir(s) of the deceased assessee. Consequently, the very assumption of jurisdiction pursuant to the said notice under section 148 of the Act is vitiated in law and, therefore, the assessment order passed under section 144 r.w.s. 147 of the Act cannot be sustained and is liable to be quashed.

12. The Hon’ble Jurisdictional High Court, in the case of Alamelu Veerappan, (supra), has held that a notice issued in the name of a deceased person is invalid. The Hon’ble High Court further held that there is no statutory obligation upon the legal heirs to intimate the Department about the death of the assessee, as the statute does not cast any such obligation upon them. The relevant portion of the judgment of the Hon’ble Jurisdictional High Court reads as under:-

13. This Court has carefully considered the submissions made by the learned counsel on either side and perused the records.

14. The issue, which falls for consideration, is as to whether the impugned notice under Section 148 of the Act issued in the name of the dead person – the said Mr. S.Veerappan is enforceable in law and the subsidiary issue being as to whether the petitioner, being the wife of the said Mr. S.Veerappan, can be compelled to participate in the proceedings and respond to the impugned notice. The fact that the said Mr. S.Veerappan died on 26.1.2010 is not in dispute. If this fact is not disputed, then the notice issued in the name of the dead person is unenforceable in the eye of law.

15. The Department seeks to justify their stand by contending that they were not intimated about the death of the assessee, that the legal heirs did not take any steps to cancel the PAN registration in the name of the assessee and that therefore, the Department was justified in directing the petitioner to cooperate in the proceedings pursuant to the impugned notice.

16. The settled legal principle being that a notice issued in the name of the dead person is unenforceable in law. If such is the legal position, would the Revenue be justified in contending that they, having no knowledge about the death of the assessee, are entitled to plead that the notice is not defective. In my considered view, the answer to the question should be definitely against the Revenue.

17. This Court supports such a conclusion with the following reasons : Admittedly, the limitation period for issuance of notice for reopening expired on 31.3.2017. The impugned notice was issued on 30.3.2017 in the name of the dead person. On being intimated about the death, the Department sent the notice to the petitioner – his spouse to participate in the proceedings. This notice was well beyond the period of limitation, as it has been issued after 31.3.2017. If we approach the problem sans complicated facts, a notice issued beyond the period of limitation i.e. 31.3.2017 is a nullity, unenforceable in law and without jurisdiction. Thus, merely because the Department was not intimated about the death of the assessee, that cannot, by itself, extend the period of limitation prescribed under the Statute. Nothing has been placed before this Court by the Revenue to show that there is a statutory obligation on the part of the legal representatives of the deceased assessee to immediately intimate the death of the assessee or take steps to cancel the PAN registration.

18. In such circumstances, the question would be as to whether Section 159 of the Act would get attracted. The answer to this question would be in the negative, as the proceedings under Section 159 of the Act can be invoked only if the proceedings have already been initiated when the assessee was alive and was permitted for the proceedings to be continued as against the legal heirs. The factual position in the instant case being otherwise, the provisions of Section 159 of the Act have no application.

19. The Revenue seeks to bring their case under Section 292 of the Act to state that the defect is a curable defect and on that ground, the impugned notice cannot be declared as invalid.

20. The language employed in Section 292 of the Act is categorical and clear. The notice has to be, in substance and effect, in conformity with or according to the intent and purpose of the Act. Undoubtedly, the issue relating to limitation is not a curable defect for the Revenue to invoke Section 292B of the Act.

21. All the above reasons are fully supported by the decision in the case of Vipin Walia (supra). In that case, the notice dated 27.3.2015 was issued under Section 148 of the Act to the assessee, who died on 14.3.2015. The validity of the said notice was put to challenge. The Income Tax Officer took a stand that since the intimation of death of the assessee on 14.3.2015 was not received by her, the notice was issued on a dead person. However, the fact regarding the death of the assessee could not be disputed by the Department. The Department continued the proceedings under Section 147/148 of the Act and at that stage, the son of the deceased approached the High Court of Delhi. The High Court of Delhi pointed out that what was sought to be done by the Income Tax Officer was to initiate proceedings under Section 147 of the Act against the deceased assessee for the assessment year 2008-09, for which, the limitation for issuance of notice under Section 147/148 of the Act was 31.3.2015 and on 02.7.2015 when the notice was issued, the assessee was already dead and if the Department intended to proceed under Section 147 of the Act, it could have done so prior to 31.3.2015 by issuing the notice to the legal heirs of the deceased and beyond that date, it could not have proceeded in the matter even by issuing notice to the legal representatives of the assessee. The decision in Vipin Walia (supra) fully supports the case of the petitioner herein.

22. The decision in the case of Vipin Walia (supra) was followed in the decision of the High Court of Gujarat in the case of Rasid Lala, (supra) in which, the reassessment proceedings were initiated against the dead person, that too, after a long delay. The Court pointed out that even if the provisions of Section 159 of the Act are attracted, in that case also, the notice was required to be issued against and in the name of the heirs of the deceased assessee and under the said circumstances, Section 159 of the Act shall not be of any assistance to the Revenue.

23. In the decision of the Delhi High Court in the case of Spice Entertainment Ltd. (supra) one of the questions, which fell for consideration, is as to whether such framing of assessment against a non-existing entity or a dead person could be brought within the ambit of Section 292B of the Act and after referring to the decisions on the point including the decision of the Allahabad High Court in the case of Sri Nath Suresh Chand Ram Naresh v. CIT [2006] 280 ITR 396 it has been held that the provisions of Section 292B of the Act are not applicable and that framing of assessment against a non-existing entity/person goes to the root of the matter, which is not a procedural irregularity, but a jurisdictional defect, as there cannot be any assessment against a dead person.

24. The learned Senior Standing Counsel for the Revenue has sought to distinguish the decision in the case of Spice Entertainment Ltd. (supra) by referring to Sky Light Hospitality LLP. Case (supra)

25. On a perusal of the factual position therein, the Court came to the conclusion that the defect was curable because it was held that the notice was not addressed to the correct name and that the PAN mentioned was also incorrect. The factual background was taken into consideration and the Court held that errors and mistakes cannot and should not nullify the proceedings, which are otherwise valid and that no prejudice had been caused, as this being the mandate of Section 292B of the Act. The decision in the case of Sky Light Hospitality LLP case (supra) is clearly distinguishable on facts and it does not support the case of the Revenue.

26. For all the above reasons, this court holds that the impugned notice is wholly without jurisdiction and cannot be enforced against the petitioner.

[emphasis supplied]

13. Further, in another judgment of the Hon’ble Jurisdictional High Court in the case of CIT v. M. Hemanathan 384 ITR 177 (Madras), wherein it was again reiterated that the proceedings initiated against a dead person is a nullity in the first place and that even if the legal heirs participate in the proceedings, the provisions of section 292BB cannot be resorted to by the revenue as the issue of the notice itself is not valid. The relevant portion of the judgment is as under:-

11. The first contention of the learned Standing Counsel for the Department is that the notice, despite having been issued against the dead person, was served on the legal heir and the legal heir also participated in the proceedings. Therefore, it is his contention that it is not open to the legal heir now to take a position that the entire proceedings are a nullity.

12. But unfortunately, the said contention loses sight of the settled position that any proceeding initiated against a dead person is a nullity. The contention of the learned Standing Counsel for the Department loses sight of one important distinction between a case where the proceedings are initiated against a person, who is alive, but continued after his death and a case of proceedings initiated against a dead person himself. If the proceedings had been initiated against a person, who was alive, and they were continued after his death after putting his legal heirs on notice, those proceedings, under certain circumstances, may be saved. Such a situation is also contemplated in civil proceedings and a provision is made in the Civil Procedure Code itself under Order XXII Rule 4. Therefore, the cases where the very proceedings are initiated against a dead person stand apart from those proceedings where they are initiated against a live person, but continued after his death against the legal heirs. Hence, the first contention is rejected.

13. The second contention revolves around section 292BB of the Act, which reads as follows :

… … … … … …

14. A cursory look at section 292BB would show that the same would apply only to two types of proceedings namely (i) proceedings, in which, the assessee had appeared and (ii) any inquiry, in which, the assessee had cooperated.

15. In the case on hand, the assessee was dead. It was the assessee’s son, who appeared and perhaps cooperated. Therefore, the primary condition for the invocation of section 292BB is absent in the case on hand.

16. Section 292BB is in place to take care of contingencies where an assessee is put on notice of the initiation of proceedings, but who takes advantage of defective notices or defective service of notice on him. It is trite to point out that the purpose of issue of notice is to make the noticee aware of the nature of the proceedings. Once the nature of the proceedings is made known and understood by the assessee, he should not be allowed to take advantage of certain procedural defects. That was the purpose behind the enactment of section 292BB. In cannot be invoked in cases where the very initiation of proceedings is against a dead person. Hence, the second contention cannot also be upheld.

17. The third contention revolves around section 159(2). It will be useful to extract section 159 in entirety. It reads as follows :

… … … … … …

18. Sub-section (1) of section 159 would apply to a case where a liability has already crystallised. The death of an assessee would not absolve the legal heirs of the assessee of any liability that the assessee had incurred during his life time. In the case on hand, the liability, if any, would have arisen only after an order is passed under section 263. Therefore, sub-section (1) of section 159 will not apply to the case on hand. Sub-section (2) of section 159 deals primarily with two contingencies. The first is dealt with in Clause (a) of subsection (2) of section 159. This Clause (a) contemplates the contingency of a proceeding taken against the deceased before his death.

19. In this case, the very initiation of proceedings under section 263 was done after the death. Clause (a) of sub-section (2) uses the expression ‘before his death’. Therefore, Clause (a) would not apply to the case on hand.

20. Clause (b) is probably more advantageous to the Revenue, if at all it could be taken advantage by the Revenue. Clause (b) attempts to save the situation where the right of the Revenue to proceed against the assessee was available at the time when the assessee had passed away. Take for instance cases where the Appellate Authority has decided an issue in favour of the assessee and before the time limit available for the Department to file a further appeal, the assessee had died. In such situation, the right to file further appeal is a right to take any proceeding that was available to the Department as if the deceased assessee had survived. Therefore, it is only those circumstances that can be said to be taken care of under clause (b).

21. In any case, in the case on hand, the Department was made aware of the fact that the assessee was dead. The Income Tax Officer’s letter dated 23.9.2013 informing his superior that the notice under section 263 returned with the endorsement of the Postal Department to the effect that the addressee was dead, clinches the fact. Despite being put on notice that the noticee was dead, the Department chose to pursue the very same notice. In such circumstances, Clause (b) of sub-section (2) of section 159 cannot be taken advantage of by the Department.

22. Sub-section (3) of section 159 contains a deeming fiction. It states that the legal representative of the deceased shall, for the purposes of this Act, be deemed to be an assessee. Therefore, it is contended by Mr.M. Swaminathan, learned Standing Counsel for the Department that the respondent should be deemed to be an assessee and the service of notice on him should be deemed to be sufficient service.

23. In other words, the contention of the learned Standing Counsel is that the respondent herein automatically becomes a deemed assessee in terms of subsection (3) and hence, his participation would pre-empt him from taking objection to the fact that the notice was addressed to a dead person.

24. Though at first blush, the contention appears to be well founded, we do not think that the Department can raise it in this case. As we have pointed out earlier, the original order of assessment was a scrutiny assessment passed under section 143(3) on 23.6.2011. After two years, the Commissioner sought to invoke section 263. The assessee had died in the meantime on 13.6.2013. The show cause notice under section 263 was issued on 6.9.2013.

25. We can give the benefit to the Department that they were not aware of the death of the assessee on that date. But, this notice dated 6.9.2013, sent by post, returned with the endorsement that the addressee was dead. Thereafter, the Department served the very same notice on the legal heir through a messenger. Therefore, the Department cannot now take advantage of subsection (3) of section 159. If the Department had issued the notice addressed to the legal heir himself, by taking recourse to section 159(3), the deeming fiction could have been taken advantage of by the Department. It is too late in the day for the Department to take advantage of the same.

26. Mr. M.Swaminthan, learned Standing Counsel drew our attention to the decision of the Madhya Pradesh High Court in Smt. Kaushalyabai v. CIT [1999] 238 ITR 1008 and contended that once the legal heir of the deceased assessee had participated in the proceedings, the defect in the notice stood automatically cured.

27. We have gone through the decision of the Madhya Pradesh High Court. As seen from the facts, out of which, the said case arose, the proceedings for assessment for the years 1975-76 to 1980-81 were completed by the Department. Thereafter, the Department noticed that the share income of the wife of the assessee, which should have been included in the assessee’s hands under section 64, had escaped assessment. Therefore, the proceedings were initiated under section 147. In the meantime, the assessee expired on 12.1.1981. Notices were issued on 3.3.1981 and they were received by the legal heirs. In response to the notices, the legal heirs actually filed returns for all these years under protest.

28. Therefore, there are two reasons as to why we cannot go by the ratio decidendi in Kaushalyabai (supra). The first is that in response to the notices, the assessee’s legal heirs filed returns of income. In other words, they submitted to the jurisdiction. Moreover, what was sought to be done was actually to include the income of the wife under section 64.

29. The second reason is that with great respect to the Madhya Pradesh High Court, the principle of law that they had mentioned therein does not appear to be correct. A notice sent to a dead person is actually a nullity. There is only one exception in so far as civil proceedings are concerned, which could be traced to Order XXII Rule 4. Section 159 of the Income Tax Act also carves out an exception. Since service of notice on the legal heir of a dead person falls under the category of an exception to the general rule, the same cannot overtake the rule in the absence of a specific provision.

30. A Bench of this Court, to which, one of us (VRSJ) was a party, had pointed out in Gopalakrishnan G.S. v. State of Tamil Nadu [2006 (4) CTC 757], that a distinction has always to be maintained between judicial/ quasi-judicial proceedings and other proceedings. In Savithriammal v. State of Tamil Nadu [2006 (3) MLJ 389], a Division Bench of this Court had categorically pointed out that the notification issued in the name of a dead person is a nullity. In Smt. Lila Vati Bai v. State of Bombay AIR 1957 SC 521, the Constitution Bench of the Supreme Court had carved out an exception.

31. The case on hand will not fall under the said exception. Therefore, the very initiation of the proceedings against the dead person and the continuation of the same despite having noticed the factum of death of the assessee, cannot be approved.

[emphasis supplied]

14. Further, the Chennai Bench of the Tribunal in the case of Late Palanisamy Gunasakan, (supra) by following the judgment of the Hon’ble Jurisdictional High Court in the case of Alamelu Veerappan, (supra) had very clearly stated that section 159 of the Act would apply only where proceedings has been initiated during the life time of the assessee and thereafter continues against the legal representative, whereas the very initiation of the proceedings is against the deceased person, section 159 of the Act has no application. The relevant finding of the Chennai Bench of the Tribunal reads as follows:-

“5. We have heard the rival submissions and perused the record. The Hon’ble Jurisdictional High Court in the case of Alamelu Veerappan v. Income Tax Officer, Non-corporate Ward- 2(2), Chenna (Madras) [07-06-2018] at para 17 held as under:

13. This Court has carefully considered the submissions made by the learned counsel on either side and perused the records.

16. The settled legal principle being that a notice issued in the name of the dead person is unenforceable in law. If such is the legal position, would the Revenue be justified in contending that they, having no knowledge about the death of the assessee, are entitled to plead that the notice is not Defective. In my considered view, the answer to the question should be definitely against the Revenue.

notice to the petitioner – his spouse to participate in the proceedings. This notice was well beyond the period of limitation, as it has been issued after 31.3.2017. If we approach the problem sans complicated facts, a notice issued beyond the period of limitation i.e. 31.3.2017 is a nullity, unenforceable in law and without jurisdiction. Thus, merely because the Department was not intimated about the death of the assessee, that cannot, by itself, extend the period of limitation prescribed under the Statute. Nothing has been placed before this Court by the Revenue to show that there is a statutory obligation on the part of the legal representatives of the deceased assessee to immediately intimate the death of the assessee or take steps to cancel the PAN registration.

19. The Revenue seeks to bring their case under Section 292 of the Act to state that the defect is a curable defect and on that ground, the impugned notice cannot be declared as invalid.

21. All the above reasons are fully supported by the decision in the case of Vipin Walia. In that case, the notice dated 27.3.2015 was issued under Section 148 of the Act to the assessee, who died on 14.3.2015. The validity of the said notice was put to challenge. The Income Tax Officer took a stand that since the intimation of death of the assessee on 14.3.2015 was not received by her, the notice was issued on a dead person. However, the fact regarding the death of the assessee could not be disputed by the Department. The Department continued the proceedings under Section 147/ 148 of the Act and at that stage, the son of the deceased approached the High Court of Delhi. The High Court of Delhi pointed out that what was sought to be done by the Income Tax Officer was to initiate proceedings under Section 147 of the Act against the deceased assessee for the assessment year 2008-09, for which, the limitation for issuance of notice under Section 147/148 of the Act was 31.3.2015 and on 02.7.2015 when the notice was issued, the assessee was already dead and if the Department intended to proceed under Section 147 of the Act, it could have done so prior to 31.3.2015 by issuing the notice to the legal heirs of the deceased and beyond that date, it could not have proceeded in the matter even by issuing notice to the legal representatives of the assessee. The decision in Vipin Walia fully supports the case of the petitioner herein.

22. The decision in the case of Vipin Walia was followed in the decision of the High Court of Gujarat in the case of Rasid Lala, in which, the re-assessment proceedings were initiated against the dead person, that too, after a long delay. The Court pointed out that even if the provisions of Section 159 of the Act are attracted, in that case also, the notice was required to be issued against and in the name of the heirs of the deceased assessee and under the said circumstances, Section 159 of the Act shall not be of any assistance to the Revenue.

23. In the decision of the Delhi High Court in the case of Spice Entertainment Ltd., one of the questions, which fell for consideration, is as to whether such framing of assessment against a non existing entity or a dead person could be

brought within the ambit of Section 292B of the Act and after referring to the decisions on the point including the decision of the Allahabad High Court in the case of Sri Nath Suresh Chand Ram Naresh v. CIT [reported in (2006) 280 ITR 396], it has been held that the provisions of Section 292B of the Act are not applicable and that framing of assessment against a non existing entity/person goes to the root of the matter, which is not a procedural irregularity, but a jurisdictional defect, as there cannot be any assessment against a dead person.

24. The learned Senior Standing Counsel for the Revenue has sought to distinguish the decision in the case of Spice Entertainment Ltd., by referring to Sky Light Hospitality LLP.

Light Hospitality LLP is clearly distinguishable on facts and it does not support the case of the Revenue.

26. For all the above reasons, this court holds that the impugned notice is wholly without jurisdiction and cannot be enforced against the petitioner.

27. Accordingly, the writ petition is allowed as prayed for. No costs. Consequently, the connected WMP is closed.

6. The undisputed facts are that the assessee expired on 09.07.2019. However, the notice issued u/s.148 of the Income-tax Act, 1961 and the order passed u/s. 148A(d), both dated 31.03.2024, were issued in the name of the deceased assessee. The assessee has placed on record the death certificate and legal heir certificate evidencing the demise of the assessee much prior to the initiation of reassessment proceedings.

7. The contention of the Revenue is that the legal representatives had not informed the Department regarding the death of the assessee and, therefore, the Assessing Officer was justified in issuing the notice in the name of the assessee. We are unable to accept the said contention.

8. The issue is no longer res integra and stands squarely covered by the decision of the Hon’ble Jurisdictional High Court in Alamelu Veerappan v. ITO (Madras). The Hon’ble High Court has categorically held that a notice issued in the name of a dead person is unenforceable in law and that the absence of intimation regarding the death of the assessee would not validate such a notice. The Hon’ble Court further held that there is no statutory obligation cast upon the legal representatives to immediately intimate the Department regarding the death of the assessee or to cancel the PAN registration. It was also held that section 159 of the Act would apply only where proceedings had already been initiated during the lifetime of the assessee and thereafter continued against the legal representatives. Where the very initiation of proceedings is against a deceased person, section 159 has no application.

9. The Hon’ble High Court further held that the defect is not a procedural irregularity curable under section 292B of the Act but a jurisdictional defect going to the root of the matter, as no valid proceedings can be initiated against a dead person. Consequently, any notice issued in the name of a deceased person is void ab initio and all consequential proceedings founded thereon are liable to be quashed.

10. In the present case, admittedly, the assessee had expired on 09.07.2019, whereas the notice under section 148 and the order under section 148A(d) were issued only on 31.03.2024 in the name of the deceased assessee. Thus, the very initiation of reassessment proceedings is against a non-existent person. The Assessing Officer did not initiate proceedings against the legal Representatives of the deceased assessee in accordance with law. Therefore, following the binding decision of the Hon’ble Madras High Court in AlameluVeerappan (supra), we hold that the notice issued under section 148 and the consequential proceedings, including the reassessment order passed pursuant thereto, are void ab initio, without jurisdiction and liable to be quashed.”

15. In the instant case, the notice u/s.148 of the Act was issued on 28.03.2018, i.e., at the fag end of the period of limitation, in the name of the deceased assessee, who had already expired much prior thereto. The AO could have issued fresh notice u/s.148 of the Act, by bringing the legal representative on record within the time limit prescribed and thereafter continued the reassessment proceedings. Having failed to do so, the judicial pronouncements referred to supra are squarely applicable to the facts of the present case. Thus, the very initiation of reassessment proceedings being against the non-existing person and the AO having not initiated proceedings against the legal representative of the deceased in accordance with law, we hold the reassessment order completed u/s.147 r.w.s.144 of the Act is bad in law liable to be quashed. Accordingly, the same is hereby quashed. It is ordered accordingly.

16. In the result, the appeal filed by the assessee is allowed.