Shahedabegum Irshadahmed Chaudhary Vs State of Gujarat & Anr. (Gujarat High Court)
The Gujarat High Court allowed the petition filed by the legal heir and wife of Late Irshadahmed Chaudhary, proprietor of Ideal Steel Corporation, challenging a GST notice dated 26.06.2025 and order dated 04.12.2025 issued in the name of the deceased taxpayer.
The proprietor, whose business involved trading in metal scrap and was registered under GSTIN 24AERPC6697J1ZW, died on 29.07.2020. His proprietorship registration was subsequently cancelled on 03.03.2021, with nil demands being assessed for failure to file GST returns for six consecutive months. The business was not continued after his death.
Despite his death, the authorities issued a pre-show-cause intimation under Section 74(5) of the Gujarat Goods and Services Tax Act, 2017 on 24.06.2025, proposing tax liability of ₹21,49,414 along with interest and penalty for FY 2018-19. A notice under Section 74(1) in FORM DRC-01 followed on 26.06.2025, and an order in FORM DRC-07 dated 04.12.2025 confirmed the proposed demand in the absence of a response.
The petitioner submitted that the proceedings were initiated against a dead person. She relied on Section 74(1) and Section 2(84) of the GGST Act, contending that the statutory reference to the “person chargeable with tax” did not permit the impugned proceedings to be issued against the deceased proprietor.
The State’s counsel did not controvert the factual position that the notice and order had been issued against the deceased taxpayer.
The High Court noted that the taxpayer had died nearly five years before the impugned notice was issued and that the GST registration had already been cancelled. It further noted that the petitioner was a housewife and was not connected with her husband’s business.
Holding that the notice dated 26.06.2025 and order dated 04.12.2025 were passed against a dead person, the Court quashed and set aside both proceedings. However, it clarified that the respondents remained at liberty to initiate proper proceedings in accordance with law against the petitioner for the outstanding demand. The petition was accordingly allowed.
FULL TEXT OF THE JUDGMENT/ORDER OF GUJARAT HIGH COURT
1. Heard learned advocate Mr. Utkarsh Desai for learned advocate Mr. Abhay Desai for the petitioner and learned Assistant Government Pleader Ms. Tanushree Shrimal for the respondent – State.
2. By way of the present petition, the petitioner herein has prayed for the following reliefs:
“09. In view of the aforesaid premises, the Petitioner humbly pray that:
A. Your Lordships may be pleased to issue a writ of mandamus or a writ in the nature of mandamus or any other writ, order or direction quashing and setting aside the impugned notice dated 26.06.2025 (Annexure F) issued against the deceased taxpayer since the same is without jurisdiction and a nullity in law;
B. Your Lordships may be pleased to issue a writ of mandamus or a writ in the nature of mandamus or any other writ, order or direction quashing and setting aside the impugned order dated 04.12.2025 (Annexure G) issued against the deceased taxpayer since the same is without jurisdiction and a nullity in law;
C. Pending notice, admission and final hearing of this petition, Your Lordships may be pleased to stay further proceedings pursuant to the impugned order dated 04.12.2025 (Annexure G) issued by the Respondent;
D. Ex parte ad interim relief in terms of prayer ‘C’ may kindly be granted;
E. Such further relief(s) as deemed fit in the facts and circumstances of the case may kindly be granted in the interest of justice, for which act of kindness your petitioners shall forever pray.”
BRIEF FACTS:
3. The petitioner herein is the legal heir (wife) of Late Irshadahmed Chaudhary who was engaged in the business of trading of metal scrap in the name and style of Ideal Steel Corporation. The same was registered under GST bearing the number 24AERPC6697J1ZW. The petitioner’s husband, i.e., Shri Irshadahmed Chaudhary passed away on 29.07.2020 after prolonged illness.
3.1. The registration of the proprietorship entity was cancelled by the respondent authorities vide order dated 03.03.2021, assessing nil demands on failure to file the GST returns for a continuous period of six months. The business of the deceased proprietor was carried on from the rented premises and the petitioner did not have any access to the said business premises. The business was not continued upon the death of the proprietor.
3.2. The petitioner being a housewife, was unable to locate the records of the business undertaken by the deceased husband. Upon death of the proprietor and subsequent to the cancellation of registration, issued pre-show cause notice intimation under Section 74(5) of the Gujarat Goods and Services Tax Act, 2017 (for short, “the GGST Act”) dated 24.06.2025 in the name of the proprietor in FORM DRC-01A, intimating proposed tax liability of Rs.21,49,414/- along with interest and penalty for the tax period Financial Year 2018-19. Since the intimation was issued after the death of the taxpayer, the present petitioner was not aware of the same and was unable to respond to the said intimation. The respondent authority thereafter, issued the impugned notice under Section 74(1) of the GGST Act, along with FORM DRC-01 dated 26.06.2025 on the deceased taxpayer seeking to recover the tax liability of the aforesaid amount. However, since the business of the proprietor was discontinued, the petitioner was not aware of such notice being issued. The respondent thereafter passed the impugned order along with FORM DRC-07 dated 04.12.2025 against the deceased taxpayer, confirming the demands proposed in the show-cause-notice in the absence of any reply filed by the deceased taxpayer.
3.3. It is the case of the petitioner that subsequent to the issuance of the impugned order, she received a call from the departmental officer in the month of May, 2026 informing her about the impugned notice and the order issued on the GSTN portal. Upon such information, the petitioner promptly submitted an affidavit physically to the State Tax Officer, informing him about the death of Shri Irshadahmed Chaudhary, the proprietor of Ideal Steel Corporation. The death certificate along with the affidavit are duly produced on record. The aforesaid has given rise to the filing of the present petition.
4. Learned advocate Mr. Desai appearing for the petitioner at the outset submits that the impugned notice dated 26.06.2025 and the impugned order dated 04.12.2025 are passed in the name of a dead person. It is submitted that the petitioner herein under Section 74(1) of the GGST Act, 2017 permits the proper officer to serve notice on the “person chargeable with tax” to determine the due from such person by passing an order. It is further submitted that the definition of “person” under Section 2(84) of the GGST Act, 2017, which includes an individual (in the case of a proprietorship concern) and not the legal heirs of such individual.
4.1. In the facts of the present case, the proprietor tax payer passed away on 29.07.2020, whereas the impugned notice was issued only on 26.06.2025, and the impugned order was passed only on 04.12.2025. Further nil dues were determined at the time of cancellation of the registration of the deceased proprietor. It is submitted that in view of the above, neither the notice under Section 74(1) of the GGST Act nor order under Section 74(9) of the GGST Act can be issued or passed against the deceased person. Resultantly, the impugned proceedings against the deceased taxpayer are without jurisdiction and a nullity in eye of law and deserves to be quashed and set aside.
5. Learned AGP Ms. Shrimal is not in a position of controvert the aforesaid factual position that the impugned notice dated 26.06.2025 and the impugned order dated 04.12.2025 are issued against a dead person.
6. Under such circumstances, in view of the aforesaid, since the impugned notice dated 26.06.2025 and the impugned order dated 04.12.2025 are passed against a dead person, which is not in dispute as referred to herein-above, the same are required to be quashed and set aside.
7. We have noted that the petitioner herein is a housewife, and not connected with her husband’s business. The GSTIN number was also cancelled by the authorities by order dated 03.03.2021 wherein assessing nil demands on failure to file GST returns for a continuous period of six months, the respondent authority issued the impugned notice dated 26.06.2025 and the impugned order dated 04.12.2025 to a dead person since they were unaware about the death of the tax payer, i.e., Shri Irshadahmed Chaudhary (husband of the petitioner).
8. For the reasons as referred to herein-above, the impugned notice 26.06.2025 and the impugned order dated 04.12.2025 are hereby quashed and set aside. It is further clarified that it is open for the respondents to initiate proper proceedings in accordance with law against the petitioner herein for the outstanding demand.
9. Accordingly, the present petition stands allowed.
