Nisha Nandakumarlegal Heir And Wife Of Late Krishnan Nandakumar10-A, Old v. Additional/Joint/Deputy/Assistant Commissioner Of Income Tax/Income Tax Officer, National Faceless Assessment Centre, New Delhi

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 30.03.2022 CORAM THE HONOURABLE MR.JUSTICE R. MAHADEVANANDTHE HONOURABLE MR.JUSTICE J.SATHYA NARAYANA PRASAD W.A. No. 485 of 2022andC.M.P. No. 3516 of 2022 Nisha NandakumarLegal heir and wife of late Krishnan Nandakumar10-A, Old No.14-A, Masilamani Street,T.Nagar, Chennai 600 017Tamil Nadu, India. .. Appellant Versus 1.Additional/Joint/Deputy/Assistant Commissioner of Income Tax/Income Tax Officer, National Faceless Assessment Centre, New Delhi. 2.The Assistant Commissioner of Income Tax, Non Corporate Circle7(1), 121, M.G.Road, Nungambakkam, Chennai – 600 034... Respondents Prayer: Writ Appeal filed under Clause 15 of Letters Patentagainst the order passed by this Court in W.P. No. 104 of 2022,dated 06.01.2022. Prayer in W.P. No. 104 of 2022 : Writ Petition filed underArticle 226 of the Constitution of India to issue a Writ ofCertiorarified mandamus calling for the records on the file ofthe first respondent passed in impugned assessment order dated21.09.2021 in PAN in ITBA/AST/S/143(3)/2021-2022/1035763790(1) under Section 143(3) read with Section 144Bof Income Tax Act for the Assessment Year 2019-2020 andconsequential notice for penalty under Section 270A dated06.10.2021 in PAN in ITBA/PNL/F/270A/2021-2022/1036192206(1) and quash the same as illegal, nullity, non-est in law and against the principles of natural justice andfair play and direct the second respondent not to proceed inpursuance to notice under Section 221(1) dated 16.12.2021 in PANAAEPN5577B in ITBA/RCV/S/221/2021-2022/1037865866(1). For Appellant : Mr.T.Pramodkumar Chopda For Respondents: Mrs.Hema Murali Krishnan Senior Panel Counsel JUDGMENT [Judgment of the court was delivered by R.MAHADEVAN,J.] "Nothing is certain except death and taxes. Thus spakeBenjamin Franklin in his letter of 13th Nov., 1789 to JeanBaptiste Leroy. To tax the dead is a contradiction in terms. Taxlaws are made by the living to tax the living. What survives thedead person is what is left behind in the form of such person'sproperty" [Refer: Shabina Abraham & Ors. vs. Collector of CentralExcise & Customs MANU/SC/0801/2015 : (2015) 10 SCC 770]. 1.The aforesaid observations of the Hon'ble Supreme Court areaptly quoted by us, as the same are squarely applicable to thefacts of the present case, wherein the respondents / Revenueproceeded with the assessment and passed the faceless assessmentorder against a dead person, who was the appellant's husband. 2.This Writ Appeal is directed against the order dated06.01.2022 passed by the learned Judge in W.P. No. 104 of 2022. 1.The aforesaid observations of the Hon'ble Supreme Court areaptly quoted by us, as the same are squarely applicable to thefacts of the present case, wherein the respondents / Revenueproceeded with the assessment and passed the faceless assessmentorder against a dead person, who was the appellant's husband. 2.This Writ Appeal is directed against the order dated06.01.2022 passed by the learned Judge in W.P. No. 104 of 2022. 3.According to the appellant, her husband late KrishnanNandakumar was carrying on proprietorship business in the nameand style of M/s.Elektronik Lab. He filed his return of incomefor the assessment year 2019-2020 on 28.09.2019 disclosing theloss of Rs.88,79,838/- and claiming a refund of Rs.10,56,140/-representing tax deducted at source. Upon scrutiny of the same,the first respondent issued a notice under section 143(2) of theIncome Tax Act (in short, “the Act”) dated 31.03.2021. Afterreceipt of the same, he was affected by Covid-19 and passed awayon 09.05.2021. Subsequently, another notice dated 08.06.2021 cameto be issued by the first respondent calling for certain detailsthrough e-portal and the same was followed by notice undersection 142(1) of the Act dated 06.08.2021. The petitionerfurther averred that even her husband's chartered accountant wasaffected by Covid-19 during that time, no reply was sent to thesaid notices, which resulted in issuance of show cause noticeunder section 144 dated 15.09.2021. Thereafter, the charteredaccountant of the petitioner's husband sent a letter dated17.09.2021 and uploaded the required documents along with deathcertificate of the assessee on 18.09.2021. While so, the firstrespondent passed an assessment order under section 143(3) r/wsection 144B dated 21.09.2021 against the petitioner's husband bymaking huge additions and levied tax thereon along with interest, besides initiating penalty proceedings. Challenging the same, theappellant preferred WP.No.104 of 2022, which by order dated06.01.2022, was dismissed, on the ground that the appellant hasexercised the option of alternate remedy, which indeed is moreefficacious remedy under the facts and circumstances of the case.Therefore, the appellant is before this court with this writappeal. 4.The learned counsel for the appellant submitted that thefirst respondent, ignoring the demise of the assessee and withoutlooking into the documents furnished by the chartered accountantof the deceased, mechanically passed the assessment order dated21.09.2021 in the name of the appellant's husband and made hugeaddition to the returned income and levied tax, besides initiatedpenalty proceedings under section 270A of the Act; and they didnot follow the mandatory requirements of furnishing the draftassessment order and / or providing an opportunity of personalhearing, as contemplated under section 144B of the Act for makingfacelessassessment.Addingfurther,it is submitted that the appeal was filed by the charteredaccountant of the appellant's husband against the assessmentorder, only in respect of huge addition towards the allegedreceiptofinterestandadditionby disallowing the claim of set off of current year lossesagainst the returned income and there was no challenge asregards the jurisdiction and validity of the assessment orderpassed by the first respondent in the name of the deceasedassessee.Thus,accordingtothelearnedcounsel,the assessment order passed on a dead person is a nullity and hasno force in law. However, the learned Judge, instead of quashingthe same, dismissed the writ petition, by the order impugnedherein, which is erroneous and unsustainable in law. 5.While making an attempt to justify the assessment orderpassed by the first respondent against the dead person viz.,husband of the appellant, the learned standing counsel appearingfor the respondents submitted that due to pressure of work and inview of the fact that the chartered accountant of the appellant'shusband uploaded the documents on behalf of the assessee, thefirst respondent lost sight of the fact that the assessee haddied. Further, the chartered accountant did not give the detailsof the legal heirs of the assessee so as to enable the firstrespondent to continue the proceedings against the legal heirs,but he merely mentioned that he was filing the response on behalfof the assessee. That apart, the order had to be passed on orbefore 31.09.2021 failing which the same would get barred bylimitation. In such circumstances, due to inadvertent mistake,the first respondent passed the assessment order, which wasimpugned in the writ petition, against the dead person. In anyevent, as per section 159(2) of the Act, any proceeding taken against the deceased before his death, shall be deemed to havebeen taken against the legal representative(s) and may becontinued against them from the stage at which it stood on thedate of the death of the deceased; section 159(3) furtherprovides that the legal representative(s) of the deceased shall,for the purposes of this Act, be deemed to be an assessee; andtherefore, despite the mistake in mentioning the name of the deadassessee and not the names of the legal representatives, byvirtue of section 292B of the Act, the assessment order passed bythe first respondent is deemed to be valid and hence, theappellant filed a statutory appeal against the same, before theappellate authority. Thus, according to the learned standingcounsel, no interference to the order of the learned Judge iswarranted at the hands of this court. 6.Heard both sides and perused the records. 7.Concededly, the appellant's husband / assessee died on09.05.2021, after receipt of the notice dated 31.03.2021 undersection 143(2) issued by the first respondent. On 15.09.2021,the first respondent issued the show cause notice under section144 to pass best of judgment assessment, to which, the charteredaccountant of the appellant's husband, after recovery fromCovid-19, sent a communication on 17.09.2021, indicating thedeath of the assessee on 09.05.2021 and uploaded the deathcertificate and legal heir certificate of the deceased. Besidesthis, on 18.09.2021, he uploaded certain documents called for bythe first respondent along with the response to the show causenotice. After noting down the factum of death of the assessee,the first respondent mechanically passed the assessment orderdated 21.09.2021 making huge addition stating that 'the responseof the assessee has been perused but not found satisfactory' andthe relevant paragraphs of the same are extracted below forready reference: “With reference to DIN: ITBA/AST/F/144(SNC)(F) /2021-22/1035588778(1) dated 15.09.2021 responseis hereby submitted. The assessee (Mr.Nandkumar Krishnan) proprietorof M/s.Elektronik Lab has been affected by COVIDduring the month of April 2021 at the time of receiptof letter from IT department. But by the month ofMay, 2021, the assessee has passed away due to COVIDhence the office was shut down. ...”Consequently, penalty proceedings under section 270A came to beinitiated and show cause notice dated 06.10.2021 was also issuedto the same dead person. Following the same, the secondrespondent issued a notice under section 221(1) of the Actaddressed to the very same dead person / appellant's husband.Challenging all the proceedings of the respective respondents,the appellant invoked the writ jurisdiction under Article 226 of https://hcservices.ecourts.gov.in/hcservices/ the Constitution of India, by filing WP.No.104/2022, which wasdismissed by the learned Judge. https://hcservices.ecourts.gov.in/hcservices/ the Constitution of India, by filing WP.No.104/2022, which wasdismissed by the learned Judge. 8.It was argued on the side of the respondents that thechartered accountant of the appellant's husband, on behalf ofthe assessee, filed reply to the notice issued by the firstrespondent and after considering the same, the respondentauthorities passed the assessment order; however, due to want ofparticulars of the legal heirs of the deceased assessee, theassessment order came to be issued against the dead person,against which, the appellant has also filed an appeal before theappellate authority. Such contention cannot be countenanced bythis court, as it is settled law that 'notice issued to a deadperson for assessment is null and void' and the filing of anappeal before the appellate authority, does not denude theappellant of her right to challenge the assessment proceedings,if it is without jurisdiction. 9.Pertinently, it is to be noted that 'an alternativestatutory remedy does not operate as a bar to maintainability ofa writ petition in at least three contingencies, namely, wherethe writ petition has been filed for the enforcement of any ofthe Fundamental Rights or where there has been a violation ofthe principles of natural justice or where the order or noticeor proceedings are wholly without jurisdiction or the vires ofan Act is challenged' [See: Whirlpool Corporation Vs. Registrarof Trade Marks, Mumbai and Others, (1998) 8 SCC 1]. It is alsotrite law that 'if the Assessing Officer had no jurisdiction toinitiate assessment proceeding, the mere fact that subsequentorders have been passed, would not render the challenge tojurisdiction infructuous' [Refer: Calcutta Discount Co. Ltd. Vs.Income Tax Officer, Companies District I Calcutta and Another,(1961) AIR SC 372]. In the light of the said legal propositionand having regard to the admitted fact that the assessee died atthe time of inception of the assessment itself and the same wasalso brought to the knowledge of the department, we are of theopinion that the assessment order passed by the first respondentagainst the dead person, that too without following mandatoryprocedure as contemplated under the Act and the consequentialproceedings emanated therefrom, cannot be allowed to besustained. However, the learned Judge erred in dismissing thewrit petition on the premise that the appellant has exercisedthe option of appeal remedy. 10.Keeping in view the aforesaid, we set aside the order ofthe learned Judge and the assessment order dated 21.09.2021 aswell as the proceedings initiated pursuant thereto for theassessment year in question and remand the matter to theassessing officer, who shall consider all the materialsfurnished by the appellant and thereafter, pass a reasoned order on merits and in accordance with law, after granting anopportunity of hearing to the legal heir(s) of the deceasedassessee / appellant. Such an exercise shall be completed withina period of three weeks from the date of receipt of a copy ofthis judgment. 11.With the aforesaid directions, this writ appeal standsdisposed of. No costs. Consequently, connected miscellaneouspetition is closed. Sd/-Assistant Registrar(CS-VII) //True copy// Sub Assistant Registrar gba/msr To1.Additional/Joint/Deputy/Assistant Commissioner, of Income Tax/Income Tax Officer, National Faceless Assessment Centre, New Delhi.2.The Assistant Commissioner of Income Tax, NonCorporateCircle7(1), 121, M.G.Road, Nungambakkam, Chennai – 600 034. +1cc to Mr.T.Pramodkumar Chopda, Advocate SR.No.21959 +1cc to Mr.Mrs.Hema Murali Krishnan, Advocate SR.No.21915 RLD(CO)GMY(27/05/2022)