LAXMI DEVI AGARWAL THROUGH LEGAL HEIR SITARAM AGARWAL,JAIPUR vs. INCOME TAX OFFICER, WARD NEEM KA THANA, NEEM KA THANA

IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCHES, JAIPUR. BEFORE SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER AND SH. UDAYAN DAS GUPTA, JUDICIAL MEMBER

I.T.A. No. 787/JPR/2026 Assessment Year: 2016-17

Laxmi Devi Agarwal through Vs. Income Tax Officer, legal heir Sitaram Agarwal Ward Neem Ka Thana Ganwari, V.P.O. Ganvari Teh Neem Ka Thana Dist. Sikar, Jaipur (Respondent) [PAN:-ABUPD2965L] (Appellant)

Appellant by Sh. Vedant Gupta, Advocate Respondent by Sh. Abhimanyu Singh Yadav, Addl. CIT Date of Hearing 29.06.2026 Date of Pronouncement 30.06.2026 ORDER Per: Udayan Dasgupta, JM:

This appeal is filed by the assessee against the order of the ld. CIT(A) National Faceless Appeal Centre NFAC (Delhi), passed u/s 250 of the Income Tax Act,1961 ( henceforth the Act )dated 24.03.2026 which has emanated from the

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order of the Assessment Unit, Income Tax Department passed u/s 147 r.w.s 144 r.w.s 144B of the I. T. Act, 1961 dated 09.05.2023.

“1. On the facts and circumstances of the case and in law also Ld. CIT(A) grossly erred in set-aside the assessment to AO for making as fresh assessment without deciding legal grounds of appeal and jurisdictional validity of the assessment order passed u/s 144. 2. On the facts and circumstances of the case and in law, the Ld. Assessing Officer grossly erred in assuming jurisdiction u/s 148 of the Act as the said notice was issued in the name of the dead person, the proceedings were conducted on a dead person, and the reassessment was also concluded on a dead person. Since, as per the settled proposition of law, any proceedings initiated or completed on a dead person are non-est and void ab initio, therefore, reassessment order passed by the Ld A.O. is void ab initio. 3. On the facts and circumstances of the case and in law, the Ld. Assessing Officer grossly erred in initiated and finalized the reassessment proceedings in the name of the dead person whereas Ld AO was aware about the death of the appellant Smt Laxmi Devi Agarwal because fact of death of assessee and name of legal heir of the deceased assessee was informed to the department by filing deceased assessee's return of income for assessment year 2020-21 on dated 5/01/2021. For registering legal heir, death certificate was also submitted on the portal. The above ROI was verified by Shri Sita Ram Agarwal , legal heir of the assessee on his account on the Income Tax Portal. Whereas assessment proceedings in this case was initiated on 27-07-2022. 4. On the facts and circumstances and in law, the Ld. Assessing Officer grossly erred in not providing any opportunity of hearing to the legal heir of the assessee and therefore, the impugned assessment order u/s 147 r.w.s. 144 is bad in law and therefore, the addition of Rs. 83,86,346/- may kindly be deleted. 5. On the facts and circumstances of the case and in law also exparte order passed by Ld A O is bad in law as no notice under section 144/142(1) was served upon legal heir of the deceased assessee.

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We also note that the said statutory notice u/s 148 dated 27th July, 2022, has 10. been issued in the name of a dead person ( after her demise ) and neither any notice has been issued on the legal heirs of the assessee and none has been brought on record as per provisions of law, and the reassessment proceedings initiated on a

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dead person is legally invalid and the entire proceedings flowing from the said invalid notice is also void ab initio .

On this issue we would like to refer to the decision of the Hon’ble Madras High Court delivered on 23rd March, 2026, in the case of Gowthaman S Legal heir of Late. K. Selvarasu VersusThe Income Tax Officer, Ward 2, Cuddalore, Tamil Nadu,2026 (3) TMI 1420 - MADRAS HIGH COURT in WA No. 529 of 2026 And CMP No. 5130 of 2026, where the Hon’ble court after analysing various judicial precedents on the issue , has observed as follows : Para 6. In the case on hand, it is beyond any cavil that the impugned proceedings were drawn against a person who died on 4.1.2024. 7. Considering an identical issue, in Meet Lalwani (supra), a Division Bench of the Madhya Pradesh High Court,in which myself was a member, after referring to a series of judgments of various High Courts observed that the notice and all consequential proceedings issued to a dead person are null and void. The relevant portion of the said judgment reads as under: “12. It has been observed by the Delhi High Court in the case of Savita Kapila v. Asst. CIT [(2020) 426 ITR 502 (Delhi)] as under (page 512 of 426 ITR): “In the absence of a statutory provision it is difficult to cast a duty upon the legal representatives to intimate the factum of death of an assessee to the Income-tax Department…Consequently, the legal heirs are under no statutory obligation to intimate the death of the assessee to the Revenue.” 13. The Madras High Court in the case of Alamelu Veerappan v. ITO [(2018) 12 ITR-OL 95 (Mad); 2018 SCC OnLine Mad 13593.] has observed as under (page 100 of 12 ITR-OL):“…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 to take steps to cancel the Permanent Account Number registration.” 14. Similar view has been taken by the High Court of Bombay in Sumit Balkrishna Gupta v. Asst. CIT [(2019) 414 ITR 292 (Bom)]wherein it has been observed as under (page 295 of 414 ITR): “7. The issue of a notice under section 148 of the Act is a foundation for reopening of assessment. The sine qua non for acquiring jurisdiction to reopen an assessment is that such notice should be issued in the name of the correct person . This requirement of Issuing notice to a correct person and not to a dead person is not merely a procedural requirement but is a condition precedent to the impugned notice being valid in law. Thus, a notice which has been issued in the name of the dead person is also not protected either by provisions of section 292B or 292BB of the Act. This is so as the requirement of issuing a notice in the name of correct person is the foundational requirement to acquirejurisdiction to reopen the assessment. This is evident from section 148 of the Act, whichrequires that before a proceeding can be

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taken up for reassessment, a notice must beserved upon the assessee. The assessee on whom the notice must be sent must be aliving person , i.e., legal heir of the deceased assessee, for the same to be responded. This in fact is the intent and purpose of the Act. Therefore, section 292B of the Act cannot be invoked to correct a foundational/substantial error as it is meant so as to meet thejurisdictional requirement.” 15. In view of the above and that various High Courts have observed that the notice issued to adead person for reopening of assessment of a dead person is null and void, this court holds that the notice and all consequential proceedings arising therefrom in the name of the deceased assessee are not sustainable.” 8. We are in complete agreement with the submission made by learned counsel for the appellant on the basis of the aforesaid decision that the Department cannot issue notice and the consequential proceedings, impugned in the writ petition, to a dead person . That apart, it is also held therein that proceedings under Section 159 of the Act can be invoked only if the proceedings have already been initiated when the assessee was alive and continuation of proceedings against the legal heirs was permitted. In the case on hand, admittedly, the proceedings have been initiated after the demise of the assessee. In such view of the matter, the writ appeal is allowed and the order passed by the learned Single Judge is set aside. As a consequence, the writ petition is allowed and the order dated 31.03.2024 passed under Section 148A(d) of the Income Tax Act, 1961; the Assessment Order dated 17.02.2025; and the notice of demand dated 17.2.2025 issued under Section 156 of the Act are set aside. There shall be no order as to costs. Consequently, interim application stands closed. 12. Before concluding we would also like to refer to the decision of the Hon’ble Apex court in the case of PCIT v Maruti Suzuki India Ltd , civil appeal No 5409 of 2019 reported 309 CTR (SC) 433 , where the Hon’ble court ( on the facts of that case ) , has observed in para 33 of the said order as under :

“In the present case , despite the fact that the AO was informed of the amalgamating company having ceased to exist as a result of the approved scheme of amalgamation , the jurisdictional notice was issued only in its name. The basis on which jurisdiction was invoked was fundamentally at odds with the legal principle that the amalgamating entity ceases to exist upon the approved scheme of amalgamation. Participation in the proceedings by the appellant in the proceedings cannot operate as an estoppel against law”. 13. As such respectfully following the law laid down by the Hon’ble Apex court in the case of PCIT v Maruti Suzuki India Ltd ,( supra )and on the recent decision

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of the Hon’ble Madras High Court Gowthaman S Legal heir of Late. K. Selvarasu Versus The Income Tax Officer,( supra ) , we are of the opinion that in the instant case , the assumption of jurisdiction by the AO, u/s 148, by issuing a notice on adead person is not legally valid, and we hold the said notice as legally invalid and consequently all subsequent proceedings flowing from the said invalid notice are also legally invalid and are quashed. 14. Since we have decided the legal issue in favour of the assessee, the remaining grounds are rendered academic and not adjudicated upon. 15. In the result the appeal of the assessee is allowed. Order pronounced on 30.06.2026 in open court .

Sd/- Sd/-

(ANNAPURNA GUPTA) (UDAYAN DAS GUPTA) Accountant Member Judicial Member * Ganesh Kumar, Sr. PS Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T.