Reassessment proceedings initiated against a minor whose income is clubbed with father’s are untenable.
Issue
Whether initiation of reassessment proceedings under Section 148 read with Section 148A against a minor assessee, whose income is clubbed with that of the father under Section 64(1A), is legally maintainable.
Facts
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Profile of the Assessee: The petitioner is a minor assessee whose income stood clubbed with the income of the father and natural guardian under Section 64(1A) of the Income-tax Act, 1961.
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Issuance of Reassessment Notices: The Income Tax Department issued an order under Section 148A(3) along with a consequential reassessment notice under Section 148 directly in the name of the minor petitioner.
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Legal Challenge: The petitioner challenged the order under Section 148A(3) and the notice under Section 148 by filing a writ petition, contending that reassessment proceedings could not be independently initiated against a minor whose income is clubbed with a parent.
Decision
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Untenable Reassessment Proceedings: Initiation of reassessment proceedings directly against the minor petitioner is not tenable when the income is clubbed with the father and natural guardian under Section 64(1A). (In favour of assessee)
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Quashing of Notices: The order passed under Section 148A(3) and the consequential notice issued under Section 148 in the name of the minor were held to be invalid. (In favour of assessee)
Key Takeaways
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Proper Jurisdiction for Clubbed Income: Where a minor’s income is clubbed with that of a parent under Section 64(1A), any reassessment or tax action must be directed against the parent in whose hands the income is clubbed.
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Invalidity of Direct Minor Assessment: Reassessment notices under Section 148/148A issued in the name of a minor child for clubbed income are bad in law and subject to quashing via writ jurisdiction.
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Procedural Compliance: Assessing Officers cannot bypass the statutory mechanism of clubbing to independently assess or reassess minor individuals directly.
HIGH COURT OF MADRAS
Liya Acharya Minor
v.
Union of India
Senthilkumar Ramamoorthy, J.
WP No. 32492 of 2026
WMP Nos. 35725 and 35726 of 2026
WMP Nos. 35725 and 35726 of 2026
SEPTEMBER 29, 2026
Bharat Raichandani and Udaya Surya H., Advs. for the Petitioner. Ms. S. Premalatha, Sr. Standing Counsel (IT) for the Respondent.
ORDER
1. When the matter was listed for admission on 24.08.2026, the following order was issued:
“An order under Section 148(A)(3) and the consequential notice under Section 148 of the Income Tax Act, 1961, are challenged in this writ petition on the ground that said order was issued against a minor in spite of the income being clubbed with that of the father and natural guardian of the minor in the return of income for the assessment year 2022- 2023.
2. Ms. S. Premalatha, learned Senior Standing Counsel, accepts notice for the respondents. She seeks time to obtain instructions.
3. On perusal of the documents on record, I find prima facie that the income was clubbed with that of the father and natural guardian. Therefore, there will be an interim stay of the impugned order and proceedings pursuant to the notice under Section 148 until the next date of hearing.
4. List on 29.09.2026.”
2. The respondents have filed a counter affidavit. In relevant part, at paragraph 7 and ground F, it is stated as under:
“7. ………………. The documents which were submitted by the father of the petitioner do not specifically segregates the income of the petitioner from the income of petitioner’s father.
F. With regard to the allegation made by the petitioner in para F of the Grounds is denied, it is submitted that the income earned by the minor need not to file Income Tax Return separately, the income can be offered to tax by clubbing the income with the guardian u/s 64(1A) of the Income Tax Act. In this instant case, petitioner’s father has failed to segregate the income of the petitioner from the petitioner’s father during the 148 proceedings to ascertain that the Income of the petitioner as well as petitioner’s father have been offered to tax. Mere non-filing of return did not attract this case as fit case for the 148 proceedings, but the inability of segregation of income of both the individuals invites the issuance of notice under Section 148 of the Income Tax Act, 1961. It is already stated in previous paragraphs that prima facie findings need not require detailed investigation in order to reopen the proceedings. “
3. In effect, the respondents have admitted that the petitioner’s income was clubbed with that of the father and natural guardian under Section 64(1A) of the Income Tax Act, 1961. In these circumstances, the initiation of re-assessment proceedings against the petitioner is not tenable. Hence, the impugned order and impugned notice are set aside by leaving it open to the respondents to initiate re-assessment proceedings against the petitioner’s father in accordance with law.
4. The writ petition is disposed of on the above terms. Consequently, connected miscellaneous petitions are closed. There shall be no order as to costs.