DIRECT TAXES
| Service of notice in the name of deceased is invalid Mon, 06 Dec 2010 |
| The Hindu Business QUESTION: Can a notice issued in the name of the deceased and served on the legal heirs after his death be valid in law? Is there any necessity for the legal heirs to comply with such notice under Sec. 143(2) in respect of a return filed by the deceased? ANSWER: It is obvious that no assessment can be made on a dead person. When a person dies during pendency of proceedings, income tax law like any other law expects the legal representatives to be brought on record. If an assessment is made in pursuance of a notice issued in the name of a dead person, though served validly on legal representatives, an assessment made in pursuance of such notice would be void ab initio. The assessing officer should have substituted the legal representatives for the deceased before issuing such notice. It was so held in CIT v Prabhawati Gupta (1998) 231 ITR 188 (MP) and a few other cases. However, where the notice is accepted by the legal representatives and they have also participated in the proceedings, an assessment could be validly treated as one made on the estate of the deceased as represented by the legal representatives, who had participated in the proceedings in the view that the defect in the notice is a curable one as held in Smt. Kaushalyabai v CIT (1999) 238 ITR 1008 (MP). But then, the preponderant view is that a bad notice cannot get validity by compliance. The preferable course of action for legal representatives is to inform the officer about the death along with particulars of legal representatives. If the assessing officer proceeds further without issuing fresh notice on legal representatives, such further proceedings without rectification of this defect would be patently bad in law. S. RAJARATNAM |
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