Sangeeta Vig Vs ITO (Delhi High Court)
Summary: The Delhi High Court, in Sangeeta Vig L/H Late Sh Sunil Vig Vs ITO, Ward 28(5), Delhi, set aside a reassessment order passed under Section 148A(d) and the consequential notice issued under Section 148 of the Income Tax Act, 1961, both dated 30 March 2022, for Assessment Year 2015-16 because they were issued in the name of an assessee who had already died. The Division Bench comprising Justice Manmohan and Justice Manmeet Pritam Singh Arora held that the controversy was covered by the earlier Delhi High Court decisions in Savita Kapila Vs Assistant CIT and Sripathi Subbaraya Manohara L/H Late Sripathi Subbaraya Gupta Vs PCIT. Following those precedents, the Court quashed the impugned order and notice while expressly preserving the Revenue’s liberty to take any further steps permissible under law.
The petitioner, Sangeeta Vig, acting as the legal representative of her deceased husband, Sunil Vig, challenged the reassessment proceedings on the ground that the order under Section 148A(d) and the consequential notice under Section 148 had been issued against a dead person. Her counsel submitted that the proceedings were void from inception because the notices suffered from a jurisdictional defect. It was further contended that the petitioner had informed the Income Tax Department about the assessee’s demise on several occasions, but the Department nevertheless proceeded to issue the impugned order and notice in his name.
On behalf of the Revenue, the Senior Standing Counsel submitted that the Department had not been aware of Sunil Vig’s death and requested permission to issue a notice to his legal representatives. The High Court considered the rival submissions and relied upon Savita Kapila Vs Assistant CIT, (2020) 118 taxmann.com 46 (Delhi), which had been followed in Sripathi Subbaraya Manohara L/H Late Sripathi Subbaraya Gupta Vs Principal Commissioner of Income Tax-22. Those decisions established that a reassessment notice issued under Section 148 in the name of a deceased person is null and void and that consequential proceedings and orders founded upon such notice cannot be sustained.
Applying that legal position, the Court set aside the Section 148A(d) order and the Section 148 notice dated 30 March 2022. Importantly, the High Court did not adjudicate the underlying alleged escapement of income or permanently prohibit the Department from proceeding against the legally appropriate persons. It expressly clarified that the Revenue would remain at liberty to take further steps if permitted by law, and that the petitioner would be free to pursue appropriate legal remedies if aggrieved by any such action. The decision reiterates that reassessment proceedings must be initiated against a legally competent person, and a notice issued in the name of an already deceased assessee cannot validly found such proceedings.
Cases Discussed
1. Savita Kapila Vs Assistant CIT (Delhi High Court); (2020) 118 taxmann.com 46; (2020) 426 ITR 502 — Followed for the principle that a reassessment notice issued under Section 148 in the name of a deceased assessee is null and void. The decision also addresses the position of legal representatives and the invalidity of proceedings commenced against a dead person.
2. Sripathi Subbaraya Manohara L/H Late Sripathi Subbaraya Gupta Vs Principal Commissioner of Income Tax-22, New Delhi and Anr. (Delhi High Court); W.P.(C) 2678/2020; 14/07/2021 — Followed as a subsequent decision applying Savita Kapila and setting aside reassessment notices, assessment orders and consequential proceedings issued in the name of a deceased assessee.
FULL TEXT OF THE ORDER OF DELHI HIGH COURT
Present writ petition has been filed challenging the Order passed under Section 148A(d) and the consequential notice issued under Section 148 of the Income Tax Act, 1961 (‘the Act’) dated 30th March, 2022 for the Assessment Year 2015-16 on the ground that the same has been issued in the name of a dead person.
Learned counsel for the Petitioner states that the impugned order and notice are invalid in the eyes of law being void from inception and the proceedings set in motion thereby suffer from jurisdictional defect.
She further states that though the Petitioner had informed the Respondent about the demise of the Assessee several times, yet the Respondent ignored the same and proceeded to pass the impugned order and notice in the name of a dead person.
On the last date of hearing, Mr. Ajit Sharma, learned counsel for the Respondent/Revenue had taken time to obtain instructions.
Today, Mr.Ajit Sharma states that the Respondent/Revenue was not aware of the death of late Sh. Sunil Vig. He prays for leave of this Court to issue notice to the legal representatives of late Sh. Sunil Vig.
This Court is of the view that the issue in the present case is covered by the Division Bench judgment in Savita Kapila vs. Assistant CIT (2020) 118 taxmann.com 46 (Delhi) which was followed by this Court in W.P.(C) No. 2678/2020 Mrs. Sripathi Subbaraya Manohara L/H late Sh. Sripathi Subbaraya Gupta vs. Principal Commissioner of lncome Tax-22, New Delhi and Anr., wherein the notice under Section 148 of the Act against a dead person was held to be null and void and all consequential proceedings/orders, including the assessment order and subsequent notices were set aside.
Keeping in view the aforesaid mandate of law, the order passed under Section 148A(d) of the Act and the consequential notice issued under Section 148 of the Act dated 30th March, 2022 are set aside. If the law permits the Respondent/Revenue to take further steps in the matter, it shall be at liberty to do so. Needless to state that if and when such steps are taken and if the petitioner has a grievance, she shall be at liberty to take her remedies in accordance with law.
