Saroj Gupta Vs DCIT (ITAT Delhi)
Section 153C Notice to Deceased Person Invalid; Participation by Legal Heir Cannot Cure Jurisdictional Defect
Search assessments for AYs 2014-15 to 2020-21 were initiated under section 153C in the name of the original assessee, who had already died on 01.01.2021. The jurisdictional 153C notice dated 30.06.2022 and the recorded satisfactions were all issued in the name of the deceased person and no fresh notice under section 153C was ever issued in the name of the legal heir.
The Department argued that once the legal heir later participated in the proceedings and filed replies after being informed, the defect stood cured under section 292BB and by analogy with the Supreme Court decision in Mahagun Realtors.
The Tribunal rejected this contention, holding that issuance of a valid jurisdictional notice to the correct person is a sine qua non for assumption of jurisdiction under section 153C. A notice issued to a dead person is a nullity in law and cannot be validated by subsequent participation of the legal heir. Section 292BB cures defects in service of notice, not complete absence of a valid notice to the proper person.
Distinguishing amalgamation cases like Mahagun Realtors, the Tribunal held that death of an individual requires a fresh statutory notice to the legal representative. Since no such notice was ever issued after the death was brought to the AO’s knowledge, the very foundation of jurisdiction failed.
Accordingly, all assessments framed under section 153C in the name of the deceased person were held void ab initio and quashed for all the seven assessment years. The assessee’s appeals were allowed in full.
FULL TEXT OF THE ORDER OF ITAT DELHI
