Reassessment in case of dead person – Sections 147, 148 and 159 – A. Y. 2008-09 – Where department intended to proceed u/s. 147 against assessee when he was already dead, it could have been done so by issuing a notice to legal representative of assessee within period of limitation for issuance of notice

A notice u/s. 148 dated 27th March 2015 was addressed by the ITO to one Mr. Inder Pal Singh Walia, seeking to reopen the assessment for A. Y. 2008-09. The notice was returned unserved to the Department with the postal authorities endorsing on it the remarks “Addressee expired”. Mr. Inder Pal Singh Walia had expired on 14th March 2015. In other words, the notice dated 27th March 2015 had been addressed to a dead person. The ITO then wrote letter to the petitioner the legal representative on 15/06/2015 proposing to continue the reassessment proceedings. On 6th July 2015, the Petitioner wrote to the ITO pointing out that his father Shri Inder Pal Singh Walia had expired on 14th March 2015 and that the proceedings initiated u/s. 148 of the Act were barred by limitation. Additionally, it was stated that he was unaware of the financial affairs or transactions carried on by his late father. On 18th July 2015, the ITO took the stand that since the intimation of the death of Shri Inder Pal Singh Walia on 14th March 2015 was not received by her office “therefore the notice was not issued on a dead person”.

The Delhi High Court allowed the writ petition filed by the petitioner and held as under:

“If department intended to proceed u/s. 147, it could have been done so prior to period of limitation by issuing a notice to legal representative of deceased assessee and beyond that date it could not have proceeded in matter even by issuing notice to Legal Representatives of assessee. Therefore, subsequent proceedings u/s. 147 against petitioner were wholly misconceived and were to be quashed.”