Ms. Atchutaramanaiah Patrudu Makena V. Income Tax Department

WP/28175/2021

AI Insights

The case involves a writ petition filed under Article 226 of the Constitution of India, challenging a rectification order passed under the Income Tax Act, 1961 against a deceased person. The petitioner, the legal representative of the deceased, argued that the rectification order was passed without jurisdiction and in violation of natural justice, as it was issued against a deceased individual without notifying the legal representatives. The respondent contended that the legal representatives failed to inform the Assessing Officer about the death of the assessee when they filed an appeal. The court found that the Assessing Officer was not informed about the death, and thus, the rectification order was set aside to allow the legal representatives an opportunity to present their case.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 804982 (HC-ANDHRA_PRADESH)
• Appeal Type: Others
• Pronouncement Date: 17-08-2022
• Assessment Year: misc
• Other Referred Cases: Smt. Sudha Prasad v. Chief CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: M KIRANMAYEE
• Assessee Lawyers: C SANJEEVA RAO
• Keywords: Assessment Year 2017-18; Death Certificate; Jurisdiction; Legal representatives; Natural Justice; Rectification Order; Writ of Mandamus
• Section: 144; 246A; 292B; 226; 159(2)(a)

Judgement Text

"THE HONOURABLE SRI JUSTICE C.PRAVEEN KUMAR AND THE HONOURABLE SRI JUSTICE A.V.RAVINDRA BABU WRIT PETITION No.28175 of 2021 ORDER:- (Per Hon’ble Sri Justice C.Praveen Kumar) Heard Sri C.Sanjeeva Rao, learned counsel for the petitioner, and Ms. M. Kiranmayee, learned Standing Counsel for Income Tax appearing for the respondent, and with their consent, this writ petition is disposed of at the stage of admission. 2. The present Writ Petition came to be filed under Article 226 of the Constitution of India seeking the following relief:- “…… to issue Writ of Mandamus or any other appropriate Writ or Order or Direction declaring the action of the respondent in passing the Rectification Order, dated 28.09.2021 for the Assessment Year 2017-18 under the Income Tax Act, 1961 against the deceased person/assessee, PA No.AYEPM8833F namely Atchuta Ramanaiah Patrudu Makena, who passed away on 14.11.2017 at Care Hospital, Unit-1, Visakhapatnam, as per the Death Certificate, dated 27.11.2017, as arbitrary, contrary to the provisions of the Income Tax Act, without jurisdiction and in violation of principles of Natural Justice and consequently set aside the proceedings of the respondent, as null and void and pass ……” 3. The petitioner herein is the wife and legal representative of one late Atchutaramanaiah Patrudu Makena. The husband 2 of the petitioner died on 14.11.2017, which fact is not in dispute. Two years thereafter, an assessment order came to be passed on 15.11.2019, under Section 144 of the Income Tax Act, 1961 (for short, “the Act”) raising a demand of Rs.32,24,864/- towards tax and interest. Pursuant to the notice received with regard to payment of tax, the petitioner along with her son went to the office of the respondent and is alleged to have explained in person about the death of her husband and also furnished a copy of the Death Certificate issued by the concerned. It is said that an assessment order came to be passed without taking into consideration the representation made by the petitioner. Thereafter, an appeal came to be filed before the Commissioner of Income Tax (Appeals), Visakhapatnam on 03.01.2020 under Section 246A of the Act against the order of assessment passed by the respondent against a dead person. It is also to be noted here that the said appeal is filed by the legal representatives of the deceased. While so, the assessing officer suo moto passed a rectification order on 28.09.2021 by reducing the demand to a tune of Rs.24,72,983/- as against the original demand of Rs.32,24,864/-. This rectification order which has been passed on 28.09.2021 is subject matter of challenge in the present writ petition. 3 4. Learned counsel for the petitioner mainly submits that in view of Section 159(2)(a) of the Act, the order under challenge cannot stand the test of legal scrutiny. In other words, his argument appears to be that if the Assessing Officer intends to proceed, he should have brought the legal representatives of the deceased on record and then, proceed further in accordance with law. He also took us through Section 292B of the Act to show that any order passed against a dead person without following the procedure under Section 159 of the Act is invalid and cannot be cured under the section. It is further stated that though an appeal lies against the rectification order, but since it has been passed without jurisdiction, the present writ petition came to be filed. 5. On the other hand, Ms. M. Kiranmayee, learned Standing Counsel for Income Tax appearing for the respondent, opposed the same contending that when an appeal is filed before the Commissioner of Income Tax (Appeals) by the legal representatives, they could have informed the Assessing Officer about the death of the assessee but instead they kept quiet and allowed the Assessing Officer to pass an order. In other words, her argument appears to be that when no information about the death of the assessee was brought to the notice of the Assessing Officer, there is nothing wrong in passing an order against the 4 assessee. In fact, it is her contention that it is the duty of the legal representatives of the assessee to inform the Assessing Officer about the death of the person more so, when they have preferred an appeal against the assessment order. 6. The point that arises for consideration in this writ petition is:- “Whether the Assessing Officer was right in passing the rectification order against the dead person without bringing the legal representatives on record?” 7. POINT:- The issue identical to the case on hand came up for consideration before Jharkhand High Court in Smt. Sudha Prasad v. Chief CIT1. Dealing with the legal issues involved, the Court held that an opportunity should be given by the Department to the widow of the deceased before any order is passed. It will be appropriate to extract the relevant portion of the order at paragraphs Nos.5 to 7, which is as under:- “5. Counsel for the writ petitioner submitted that what has to be done is to quash the order of assessment, annexure 8, and the demand notice, annexure 8/1, and to permit the department to proceed in accordance with law. Counsel for the department, on the other hand, submitted that since it is a case of a bona fide mistake arising out of ignorance of the death of B.B. Prasad, the department should be allowed to complete the proceeding under the Act 1 2005 Tax Pub (DT) 0032 (Jhar-HC) 5 by giving an opportunity to the legal representatives of deceased B. B. Prasad either to file a return or to file an objection to the notice under section 142 of the Act. 6. On the facts and in the circumstances of the case, we are of the view that an opportunity should be given to the department to complete the proceeding, after giving an opportunity to the writ petitioner, the widow of the deceased B. B. Prasad, to file a return an objection to the notice under section 142 of the Act. However, since the widow has appeared before us, no fresh notice need to be given to her. It will be open to her either to file a return or an objection to the notice under section 142 of the Act. 7. It will also be open to the authority concerned to proceed to complete the assessment based on such return or objection, after giving notice to the other legal representatives, if any, of the deceased B. B. Prasad and after hearing them. It will be the obligation of the widow of the deceased B.B. Prasad, to furnish the details of the other legal representatives, if any, of the deceased B. B. Prasad along with her objection.” 8. As seen from the material available on record, the fact that the assessee died, was not brought to the notice of the Assesssing Officer. Unless the said fact was brought to the notice of the Assessing Officer, one cannot expect the Assessing Officer to issue notice to the legal representatives of the said person. The fact that the Assessing Officer was not informed about the death of the assessee being not in dispute; and with a view to give an opportunity to the legal heirs to present their case, in the facts and circumstances of the case, the impugned 6 order has to be set aside and the matter has to be remanded back to the Assessing Officer. 9. Accordingly, this Writ Petition is allowed setting aside the rectification order, dated 28.09.2021, passed by the respondent and the matter is remanded back to the Assessing Authority, who shall give a notice to the legal representatives of the assessee and thereafter, proceed further in accordance with law. Insofar as the appeal pending before the Commissioner of Income Tax (Appeals) is concerned, it is for the said authority to take steps in accordance with law. There shall be no order as to costs. Miscellaneous petitions pending, if any, in this Writ Petition shall stand closed. _______________________________ JUSTICE C.PRAVEEN KUMAR ________________________________ JUSTICE A.V.RAVINDRA BABU Date : 17.8.2022 AMD 7 125 THE HONOURABLE SRI JUSTICE C.PRAVEEN KUMAR AND THE HONOURABLE SRI JUSTICE A.V.RAVINDRA BABU WRIT PETITION No.28175 of 2021 Date : 17.8.2022 AMD "