Gujarat High Court
Nayanaben Harshadkumar Kayasth Lhs Of ... vs The Income Tax Officer, Ward 1(3)(1) on 23 December, 2024
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
NEUTRAL CITATION
C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 6052 of 2022
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR.JUSTICE D.N.RAY
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Approved for Reporting Yes No
No
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NAYANABEN HARSHADKUMAR KAYASTH LHS OF LATE
HARSHADKUMAR BHOGILAL KAYASTH
Versus
THE INCOME TAX OFFICER, WARD 1(3)(1) & ANR.
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Appearance:
MR TUSHAR HEMANI, LD.SR.ADV WITH MS VAIBHAVI K PARIKH(3238)
for the Petitioner(s) No. 1
MR.VARUN K.PATEL(3802) for the Respondent(s) No. 1,2
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CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR.JUSTICE D.N.RAY
Date : 23/12/2024
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)
1. Heard learned Senior Advocate Mr.Tushar Hemani with learned advocate Ms.Vaibhavi K. Parikh for the petitioner and learned advocate Mr.Dev D. Patel for learned Senior Standing Page 1 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined Counsel Mr.Varun K. Patel for the respondents.
2. Rule, returnable forthwith. Learned advocate Mr.Dev Patel waives service of notice of rule for and on behalf of the respondents.
3. By this petition under Article 226 of the Constitution of India, the petitioner has prayed for the following reliefs :
"(a) quash and set aside the impugned notice at ANNEXURE "A" to this petition;
(aa) quash and set aside the Assessment Order and demand notice for the Assessment Year 2017-18 at ANNEXURE "D (Colly.)" to this petition;
(b) pending the admission, hearing and final disposal of this petition, to stay the implementation and operation of the notice at ANNEXURE "A" to this petition and stay the further Page 2 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined proceedings for the Assessment Year 2017-18;
(bb) pending the admission, hearing and final disposal of this petition, to stay the implementation and operation of the Assessment Order and demand notice for the Assessment Year 2017-18 at ANNEXURE "D (Colly.)" to this petition;
(c) any other and further relief deemed just and proper be granted in the interest of justice;
(d) to provide for the cost of this petition."
4. The brief facts of the case are as under :
4.1. The petitioner is a legal representative of the deceased-assessee i.e. late Harshadkumar Bhogilal Kayasth. By filing this petition under Article 226 of the Page 3 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined Constitution of India, the petitioner has prayed to quash and set aside the notice dated 31.03.2021 for Assessment Year 2017-18 issued in name of late husband of the petitioner under Section 148 of the Income Tax Act, 1961 (for short 'the Act') to re-open the assessment for the said year. 4.2. It is the case of the petitioner that the late husband of the petitioner expired on 07.11.2020 and thereafter, the impugned notice is issued after lapse of four years.
5.1. Learned Senior Advocate Mr.Tushar Hemani for the petitioner has filed an additional affidavit placing on record the Acknowledgment of the return of income for Assessment Year 2017-18, Statement of total income, Income Tax Return in Form ITR-3 and Screenshot of Income Tax Portal to point out Page 4 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined that there was an updation of the Primary Email address as per the Adhar Card of the late husband of the petitioner for the year under consideration as the earlier Email address i.e. [email protected] was updated to [email protected]. 5.2. It was pointed out that the return of income was filed at the updated Email address and in spite of such facts on record, the notices have been issued upon the old Email address as contended by the respondent in the affidavit-in-reply.
5.3. It was submitted that it is an admitted position that the impugned notice is issued against a dead person and therefore, the same is void-ab-initio and the contention of the respondent that earlier notices were Page 5 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined served upon the late husband of the petitioner is contrary to the record.
5.4. Reliance was placed on the decisions of this Court in cases of Mitesh Goradhandas Somaiya LHS of Late Goradhandas Madhavji Somaiya versus Income Tax Officer Ward 6(1) (1) rendered in Special Civil Application No.5870 of 2022 and Himadri Kandarp Mehta Versus Income Tax Officer reported in [2022] 144 taxmann.com 34 (Gujarat). 6.1. On the other hand, learned advocate Mr.Dev D. Patel for the respondent-Assessing Officer referred to and relied upon the following averments made in the affidavit-in- reply:
"2. It is submitted that in respect of the above petitioner, the return of income for Page 6 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined the A.Y 2017-18, was filed on 10.04.2017 and further in present case the information was uploaded in the Insight Portal by the Department that the assessee has undertaken financial transactions being unrecorded sale consideration, emanating out of search conducted in Popular Group of cases for Rs.1,11,86,585/- on the basis of the above said information this case was reopened by issuing notice u/s. 148 of the I. T Act, 1961 on 31.03.2021 and notice was duly served on 31.03.2021 at 01.05.05 PM on email i.e. santosh [email protected]. A copy showing the mail being served is annexed herewith and marked as ANNEXURE-R1. It is further submitted that thereafter, the case was transferred to the National Faceless Assessment Centre, Delhi and further, proceedings were carried out by NFAC. Page 7 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025
NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined
3. It is submitted that the NFAC (National Faceless Assessment Centre) has issued the following 142(1) notices and show cause notice issued to assessee, the details is as under:
Sr.No Notice Date Status E-mail ID u/s
1. 142(1) of 26.11.2021 Bounced santosh_shrivastav@redi the IT Act ffmail.com
2. 142(1) of 01.02.2022 Bounced santosh_shrivastav@redi the IT Act ffmail.com
3. 142(1) of 25.02.2022 Bounced santosh_shrivastav@redi the IT Act ffmail.com
4. Show 12.03.2022 Bounced santosh_shrivastav@redi cause ffmail.com notice The documents showing the aforesaid emails being bounced back are annexed herewith and marked as ANNEXURE-R2.
4. It is further submitted that on verification on portal, it is seen that in response to the show cause notice dated 12.03.2022, the assessee has submitted response on 29.03.2022 through online. A copy of said reply is annexed herewith and Page 8 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined marked as ANNEXURE R3. It is submitted that thereafter, National Faceless Assessment Centre had passed assessment order u/s. 147 r.w.s. 144 r.w.s. 144B of the IT Act on 30.03.2022 and the same was served on 01.04.2022 through e-mail ([email protected]) to the petitioner. A copy of said notice/mail being served is annexed herewith and marked as ANNEXURE R4.
5. It is thus submitted that following facts are observed from what is stated hereinabove:
(i) First notice u/s. 148 of the I. T. Act dated 31.03.2021 was duly served upon the assessee on same date on mail ID being ([email protected])
(ii) Therefore, all notices u/s. Page 9 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025
NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined 142(1) of the I. T. Act was issued on the same mail ID, but it is shown as bounced and it may have happened, because the assessee has blocked Department's mail.
(iii) It is submitted that the show cause notice dated 12.03.2022 was also shown as bounced, however the TARY assessee in her response dated 29.03.2022, has mentioned in the description of said notice dated 12.03.2022, which means that the said show cause notice dated 12.03.2022 was received and it was in the knowledge of the assessee.
(iv) It is further submitted that the order in this case was passed on 30.03.2022 u/s.147 r.w.s. 144 r.w.s. 144B of the Act by the National Faceless Assessment Centre and it may Page 10 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined have happened due to technical glitch in the ITBA and submission of the assessee (attachment of Interim Order of the Hon'ble Gujarat High Court) may not be displayed on 30.03.2022 to the Assessing Officer, at the time of Passing Assessment Order.
(v) It is further submitted that the Assessment order dated 30.03.2022, along with computation of total income and Demand Notice were duly served to the assessee on the same mail ID. It is therefore submitted that though first notice u/s. 148 of the Act and final assessment order were served to the assessee, but other notices sent in between sent on the same email ID were surprisingly bounced back." 6.2. Referring to the above averments, it Page 11 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined was submitted that the respondent-Assessing Officer has served the notices under Section 142(1) of the Act upon the Email address furnished by the late husband of the petitioner available in the computer system and therefore, there is no failure on the part of the respondents to issue the notice for re- opening under Section 148 of the Act.
7. However, considering the above submissions, it is apparent and not in dispute that the impugned notice has been issued upon the late husband of the petitioner and therefore, the same would be without jurisdiction as it is now also evident from the additional documents placed on record including the Screenshot from the Income Tax Portal at page No.85 of the compilation wherein, the Email address had been updated as per the Adhar Card of the late husband of the Page 12 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined petitioner. It is also evident from the record that the updated Email address as per the Screenshot is also reflected in the return of income in Form ITR-3 showing the same Email address as [email protected].
8. Thus, the averments made by the respondent-Assessing Officer justifying the action of issuing the notice on the Email address available on the record cannot be accepted. This Court in case of Mitesh Goradhandas Somaiya (Supra) has held as under :
"5. The only issue to be considered in the present petition is whether the Assessment proceedings are maintainable against the dead person. Similar question had come up for consideration before this court in Himadri Kandarp Page 13 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined Mehta L/H of Late Kandarp Yashshvibhai Mehta vs. The Income Tax Officer being Special Civil Application No. 16323 of 2019 decided on 1.8.2022. 5.1 Extracting the discussion from Himadri Kandarp Mehta (supra) which would apply and cover the present case, "5. The Division Bench of this Court in Urmilaben Anirudhhasinji Jadeja Vs. Income Tax Officer, Ward 7(1)(3) [(420) ITR 226], addressed the very issue. The Court considered various decisions of the Supreme Court and the High Court, touching the aspects of the issue, held that there cannot be any assessment against a dead person. In that case also, notice was issued to the dead assessee Page 14 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined under Section 148 of the Income Tax Act, 1961 (hereinafter referred to as the "Act").
5.1 While holding that the proceedings would be nullity against the dead assessee, the rider was provided that in cases where legal representatives participate in the assessment or re-assessment proceedings, the proceedings may be maintained and continued. It was at the same time held that mere intimation by the legal representative to the assessing officer that the noticee is dead, would not amount to legal representation on participation in that proceedings.
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NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined 5.2 In Urmilaben Anirudhhasinji Jadeja (supra), while the revenue raised various contentions seeking a proposition that the proceedings against the dead assessee would be maintained, the Court negatived them all.
5.3 One of the contention was based on Section 292B of the Act. The said provision contemplates that the notice shall be deemed to be valid in certain circumstances. It mentions that where an assessee has appeared in any proceedings or cooperated in any inquiry relating to assessment or re-assessment, it shall be deemed that a notice required to be served under the Act has been duly served upon him. Such, Page 16 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined it is provided, shall be precluded by taking any objection about the service of the service of the notice and manner of the service. 5.4 The Division Bench held that the said provision would not apply in cases where notices are gone to the dead assessee and the proceedings are started against a dead assessee.
It was observed and held in paragraph 23 thus, "The purport of Section 292B of the Act is that in the event of any mistake, defect or omission in the notice or other proceedings, if the same is in conformity with or according to the intent and purpose of the Page 17 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined Act, the notice cannot be termed as invalid. To put it in other words, the notice should be in conformity with and in accordance with the intent and purpose of the Act. In our opinion, a case in which notice is issued to a dead person could be termed as nullity. It is something like a safeguard passing a decree against a dead person which cannot be executed through the legal representatives of the judgment-debtor.
5.4.1 The continuation of proceedings pursuant to notice under Section 148 of the Act was held to be without authority of law by the Court stating thus - Page 18 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025
NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined "...the notice under section 148 of the Act, which is a jurisdictional notice, has been issued to a dead person. Upon receipt of such notice, the legal representative has raised an objection to the validity of such notice and has not complied with the same. The legal representative not having waived the requirement of notice under section 148 of the Act and not having submitted to the jurisdiction of the Assessing Officer pursuant to the impugned notice, the provisions of section 292B of the Act would not be attracted Page 19 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined and hence, the notice under section 148 of the Act has to be treated as invalid. In the absence of a valid notice, the Assessing Officer has no authority to assume the jurisdiction under section 147 of the Act and, hence, continuation of the proceeding under section 147 of the Act pursuant to such invalid notice, is without authority of law. The impugned notice as well as the proceedings taken pursuant thereto, therefore, cannot be sustained."
5.5 Thus, the law is well settled that unless the heirs and legal representatives of the deceased Page 20 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined assessee could be said to have been submitted to the jurisdiction of the assessing officer and have participated in the assessment or re-assessment proceedings, notice to the dead assessee and commencement of assessment or reassessment proceedings against dead person is rendered null and void.
5.6 The attempt on the part of the income tax authorities to start proceedings for assessment or re- assessment against the dead person is viewed not merely as procedural irregularity but it is stated as jurisdictional defect.
5.7 There cannot be an assessment against the dead person. As noticed Page 21 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined above, the provisions of Section 292B of the Act are also not applicable and no assessment can be framed against a nonexisting entity or a person who has died."
5.2 In light of the above law, reverting back to the facts of the present case, assessee-Gordhandas Madhavji Somaiya died on 20.08.2019. Notice under section 148 of the Income Tax Act came to be issued on 30.3.2021, that is after about nineteen months from the death of the assessee. 5.3 Noticeably, it transpires from the record that the petitioner herein who happens to be the legal representative of the deceased assessee, intimated to the Income Tax officer concerned on Page 22 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025 NEUTRAL CITATION C/SCA/6052/2022 JUDGMENT DATED: 23/12/2024 undefined 16.2.2022 by addressing letter that the noticee Gordhandas Madhavji Somaiya had died long back and that the notice was without jurisdiction. The Income Tax authorities did not pay heed to the said intimation.
5.4 The facts of the case did not offer any fact or circumstances to suggest that the legal representative of the deceased assessee in any manner submitted to the jurisdiction of the income tax authorities or in any way participated in the proceedings to persuade the court to hold otherwise. On the contrary, communication dated 16.2.2022 was sent to the Income Tax officer by the legal representative that the noticee Goradhandas Madhavji Somaiya had died."
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9. In view of the above, the petition deserves to be allowed by holding that the impugned notice which was issued against the dead-assessee cannot be sustained. Accordingly, the notice dated 31.03.2021 issued under Section 148 of the Act in name of Harshadkumar Bhogilal Kayasth as a dead person by the respondent-Assessing Officer is held to be illegal. The impugned notice is therefore quashed and set aside and accordingly, the Assessment Order dated 30.03.2022 would also not survive. Rule is made absolute to the aforesaid extent. No orders as to cost.
(BHARGAV D. KARIA, J) (D.N.RAY,J) PALAK Page 24 of 24 Uploaded by PALAK BRAHMBHATT(HC01391) on Tue Jan 07 2025 Downloaded on : Fri Jan 10 22:06:45 IST 2025