INCOME-TAX OFFICER, WD.4(2)(1),, AHEMDABAD vs. LATE KHODAJI RANCHHODJI THAKOR LEGAL HEIR NARENDAKUMAR KHODAJI THAKOR, AHMEDABAD

At the outset, both the parties fairly submitted that the issue raised by the Revenue in the present appeal stands covered by the order of the Tribunal in the assessee’s own case in for AY 2017-18 dated 06.11.2025. For the sake of ready reference, the operative portion of said order is reproduced as under: “…6. We have heard the rival contentions and perused the material on record. The core issue involved in the present appeal filed by the Department is the validity of the assessment order passed in the name of a deceased person, late Shri Khodaji Ranchhodji Thakor, who had expired on 21.03.2017, much prior to the issuance of statutory notices and completion of assessment under section 144 of the Act. It is an undisputed fact on record that all notices, including those issued under sections 142(1) and 148 of the Act, were issued in the name of the deceased assessee and were served through his registered e-mail address, of which the legal heirs had no knowledge. The legal heir, Shri Narendra Khodaji Thakor, came to know of the assessment proceedings only upon receipt of the recovery notice in late 2022. These facts have been duly verified and recorded by the learned CIT(Appeals), who in our view correctly held that the assessment framed in the name of a dead person is void ab initio and not sustainable in law. It is a settled position of law that proceedings initiated and completed against a deceased person are a nullity and without jurisdiction. The Hon’ble Gujarat High Court in Chandreshbhai Jayantibhai Patel v. Income-tax Officer [(2019) 101 taxmann.com 362 (Guj)] categorically held that a notice issued under section 148 of the Act in the name of a deceased person is invalid and the consequent assessment is non est in the eyes of law. The Court further observed that the obligation lies upon the Revenue to ascertain the legal heirs before initiating proceedings, and section 292BB cannot cure such a fundamental defect because that provision applies only to a living assessee. The Hon’ble Supreme Court has also upheld this legal principle. In Income-tax Officer v. Bhupendra Bhikhalal Desai [2021] 131 taxmann.com 40 (SC), the Hon’ble Supreme Court upheld the Gujarat High Court’s decision holding that a notice issued under section 153C of the Income-tax Act, 1961, in the name of a deceased person is unenforceable and void in law. In that case, the assessee, Shri Bhupendra Bhikhalal Desai, had passed away on 23.04.2017, yet the Assessing Officer issued a notice under section 153C on 29.03.2019 in his name. The legal heir informed the AO about the assessee’s death and requested that the proceedings be dropped, but the AO rejected the objection on the ground that the department was unaware of the death. The High Court quashed the notice and assessment, holding that the Revenue cannot justify an invalid notice merely because it lacked knowledge of the death of the assessee. The Supreme Court dismissed the Revenue’s Special Leave Petition, thereby affirming that any notice issued to a deceased person is void and without legal effect. In Principal Commissioner of Income-tax v. Maruti Suzuki India Ltd. [(2019) 416 ITR 613 (SC)], the Hon’ble Court held that an assessment order passed in the name of a non-existent entity, being void ab initio, cannot be validated by section 292B or section 292BB of the Act. The Court held that participation or lack of objection by the assessee does not confer jurisdiction upon the Assessing Officer when the very foundation of the proceedings is fundamentally defective. The ratio of this judgment applies with equal force to cases where assessment proceedings are initiated in the name of a deceased person, who, in law, ceases to exist. In the case of Neena Jatin Shah vs. Income-tax Officer [2025] 179 taxmann.com 498 (Bombay)[30- 09-2025], the Hon'ble High Court held that notice under section 148 could not be issued to a dead person, and if it was done, same was null and void. In the case of Utpala Pradeep Jain vs. Assistant Commissioner of Income-tax [2023] 153 taxmann.com 700 (Gujarat)/[2024] 467 ITR 592 (Gujarat), the Hon'ble High Court held that where assessee died and thereafter Assessing Officer issued notice under section 148 in his name to reopen assessment, initiation of reassessment proceeding in name of deceased assessee and not in name of his legal representative were illegal and liable to be quashed.

In the present case, the CIT(Appeals) has recorded a clear finding that the assessee had expired much prior to the initiation of proceedings and that the notices were issued and assessment was completed in the name of the deceased person. The learned CIT(Appeals) has rightly applied the binding judicial precedents to hold that such assessment proceedings are void ab initio and non est in law. We also note that the Revenue has not disputed the fact of the assessee’s death prior to the issuance of notice or brought any material on record to show that the proceedings were ever validly continued against the legal heirs in accordance with section 159 of the Act. Considering the totality of facts and the consistent legal position laid down in the judicial precedents referred to above, we find no infirmity in the order passed by the learned CIT(Appeals).

In the result, the appeal filed by the Revenue is, therefore, dismissed...”

In the absence of any change in factual matrix and legal proposition brought to our notice, the appeal of the Revenue is hereby dismissed.

In the result, the appeal filed by the Revenue is dismissed.