Case Law Details
V.Purushothaman Vs ITO (Madras High Court)
Introduction: The Madras High Court recently rendered a significant judgment in the case of V. Purushothaman Vs ITO, challenging an assessment order and penalty proceedings against the deceased. This article delves into the court’s decision, examining the implications of timely intimation of death on income tax proceedings.
Analysis: The crux of the matter lies in the initiation of reassessment proceedings against the petitioner’s deceased father, prompted by a notice under Section 148A(b) of the Income Tax Act, 1961. The petitioner promptly responded to this notice, informing the authorities of the demise of his father in 2015. Despite this communication, subsequent actions, including the assessment order and penalty proceedings, were pursued against the deceased.
The petitioner’s argument, supported by legal counsel, rested on the invalidity of proceedings against a deceased individual. This contention gained strength from the acknowledgment of the petitioner’s communication by the income tax officer. The court scrutinized the timeline of events, emphasizing the petitioner’s diligent efforts to apprise the authorities of the demise, substantiated by documentary evidence.
In contrast, the respondent, represented by learned counsel, cited procedural constraints due to the transition to the National Faceless Assessment Unit. However, the court highlighted the legal imperative of timely communication of vital information, underscoring the responsibility of legal heirs to inform relevant authorities promptly.
Central to the court’s decision was the acknowledgment of the petitioner’s communication and the issuance of proceedings against a deceased person, deemed legally unsustainable. The court deemed it imperative to set aside the impugned orders, paving the way for proper initiation of proceedings against the legal heirs in compliance with legal provisions.
Conclusion: In conclusion, the Madras High Court’s decision in V. Purushothaman Vs ITO exemplifies the legal significance of timely intimation of death in income tax proceedings. The judgment underscores the obligation of legal heirs to communicate vital information promptly to relevant authorities. By setting aside the impugned orders and leaving all contentions open for further proceedings against the legal heirs, the court upholds the principles of procedural fairness and legal validity. This verdict serves as a precedent emphasizing the importance of procedural compliance in tax matters, ensuring equitable treatment under the law.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
An assessment order dated 11.03.2024 and the consequential penalty proceedings dated 11.03.2024 are challenged in this writ petition. Reassessment proceedings against the father of the petitioner were initiated pursuant to notice dated 16.02.2023 under Section 148A(b) of the Income Tax Act, 1961.
2. The petitioner asserts that such notice was replied to on 03.03.2023 by informing the respondents that the petitioner’s father died on 21.11.2015. Thereafter, pursuant to show cause notice dated 04.09.2023, the petitioner, by reply dated 11.09.2023, reiterated that his father died in 2015 and that the notice is invalid on such ground. The impugned orders were issued in these facts and circumstances.
3. By referring to the petitioner’s reply dated 03.03.2023, learned counsel for the petitioner points out that such reply also bears the acknowledgment of the income tax officer. She further submits that the impugned assessment order and penalty proceedings are vitiated since such proceedings were initiated against a dead person.
4. Mrs. S. Premalatha, learned junior standing counsel, accepts notice for the respondents. She points out that the assessment is being undertaken by the National Faceless Assessment Unit. Consequently, she submits that it would not be possible to take into account communications addressed through post by the petitioner herein. She further submits that the death of the assessee was not communicated to the Income Tax Department by the legal heirs until 2023.
5. The petitioner has placed on record death certificate dated 07.09.2023. Such certificate discloses that Mr. Veeraraghavan died on 21.11.2015. The legal heirship certificate dated 06.01.2016 reveals that the late Mr. Veeraraghavan left behind five class-1 legal heirs. Such legal heirs include the petitioner herein.
6. From the replies dated 03.03.2023 and 11.09.2023, it is clear that the petitioner informed the income tax officer about the death of the assessee on 21.11.2015. Since the impugned assessment order and impugned penalty proceedings were issued against a dead person, the same are unsustainable.
7. Therefore, the orders impugned herein are set aside by leaving it open to the respondents to initiate proceedings in accordance with law against the legal heirs of the assessee. All contentions are left open to the petitioner and the other legal heirs in such proceedings.
8. The writ petition is disposed of on the above terms without any order as to costs. Consequently, connected miscellaneous petitions are closed.
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