GST Assessment Against Deceased Proprietor Remanded for Notice to Legal Heirs by Patna HC

Arundhuty Ghosh daughter of Late Bharat Lal Vs State of Bihar (Patna High Court)

Summary: The Patna High Court considered a writ petition filed by Arundhuty Ghosh, daughter and legal heir of Late Bharat Lal, the proprietor of M/s Ghosh Engineering, challenging proceedings initiated against the deceased proprietor under GST. Bharat Lal, who was the registered proprietor of the firm bearing GSTIN No. 10ABQPL3094A3ZZ, had died on 18.04.2021. The petitioner sought quashing of the notice dated 30.01.2026 and the order dated 09.04.2024 by which tax and penalty amounting to Rs. 61,61,722/- had been imposed against Late Bharat Lal for the period 2018-19.

The petitioner contended that after the proprietor’s death, proceedings could not legally be initiated or continued against him and that an order passed against a dead person was a nullity and void ab initio. It was further submitted that the business activities had come to an end after the proprietor’s death and that the petitioner had subsequently applied for cancellation of GST registration on 06.04.2023, which was allowed by the Joint Commissioner of State Tax by letter dated 27.04.2023. The State, however, submitted that the business had continued after the proprietor’s death, relying upon the return filed for March 2023 in which the petitioner had admitted turnover of Rs. 21,38,710/-. The State also referred to Rule 20 of the GST Rules and contended that the cancellation application had not been filed within 30 days of the proprietor’s death and had instead been made on the ground of discontinuation of business.