LATE SHRI DEVENDRA PAREEK vs. ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-1, JAIPUR

Facts

The petitioner, through his legal heir, filed a writ petition challenging proceedings initiated by the Assistant Commissioner of Income Tax (Central Circle-1, Jaipur) under Section 148A of the Income Tax Act, 1961. The core issue is that these proceedings were initiated against a deceased assessee. The department's action involved issuing notices under Section 148A, which are preliminary steps for reassessment. The petitioner contended that such proceedings against a deceased person are impermissible without following the correct legal procedure for impleading legal heirs. The procedural history indicates that the department proceeded without adhering to the established legal framework for deceased assessees.

Held

The High Court held that proceedings under Section 148A of the Income Tax Act, 1961, cannot be initiated against a deceased assessee. The Court reiterated the well-settled law that such proceedings require compliance with Section 159 of the Act, which provides for the liability of legal representatives. The Court noted that the department had initiated proceedings under Section 148A against the deceased assessee without taking recourse to Section 159. The Court relied on its previous judgments in D.B. Civil Writ Petition No.9985/2023 and D.B. Civil Writ Petition No.15115/2022, which had settled this proposition. Consequently, the notices issued under Section 274 of the Act were quashed and set aside. The Court granted liberty to the respondents (the department) to reinitiate proceedings against the legal representatives of the deceased assessee strictly in accordance with the provisions of Sections 148A(b) and 159 of the Act.

Key Issues

1. Whether proceedings under Section 148A of the Income Tax Act, 1961, can be initiated against a deceased assessee without complying with the provisions for legal representatives? The assessee argued that proceedings under Section 148A of the Act of 1961 cannot be initiated against a deceased person. They contended that the correct procedure would involve taking recourse to Section 159 of the Act, which deals with the liability of legal representatives, and that this procedure was not followed. The assessee relied on a judgment by a Coordinate Bench of the High Court in D.B. Civil Writ Petition No.9985/2023 (Legal Heirs of Smt. Sneh Lata Bhandari Vs. Income Tax Officer and Ors.) and another Division Bench judgment in D.B. Civil Writ Petition No.15115/2022 (Meena V. Kumar Vs. Principal Chief Commissioner of Income Tax & Anr.). The revenue's contentions were not explicitly recorded in the judgment.