Income Tax Notice to a Dead Assessee!
DEATH and taxes are famously linked, but can you imagine an Income Tax notice to a dead assessee. That is precisely what happened in a case before the Delhi High Court recently.
A notice was issued by the ITO on 27th March 2015 to an assessee who died on 14th March 2015. The assessee's son wrote to the ITO that his father was dead; that the notice was time barred and that he did not know the financial affairs of his father.
The ITO was not amused. She took the stand that:
1. As the intimation of the death of the assessee was not received in her office, the notice was not issued on a dead person. (Death has to ratified by the ITO?)
2. The endorsement made by the postman that the addressee was dead, is treated as refusal by the family members of the Assessee to accept the notice.
On these two erroneous grounds, the Department continued the proceedings in the notice issued to the person who was dead even before the date of notice.
The High Court had no hesitation in holding that the actions of the Revenue in this case in persisting with the proceedings under Section 147/148 of the Act against the Petitioner were wholly misconceived both on facts as well as on merits. Accordingly, the impugned notice dated 27th March 2015 and all proceedings consequent thereto were quashed.
It is not as if the Income Tax authorities have no authority to recover tax dues from a dead person. The Legal representative of the dead person is liable to pay the dues.
But in this case they had a peculiar problem.
The last date for issue of notice in this case was 31st March 2015. They issued the notice on 27th March. 28th and 29th March were holidays being Saturday and Sunday. So they just had two more days. And to their bad luck, the assessee was already dead a full fortnight before the notice. Now, they did not have the time to issue the notice to the legal representative of the dead assessee; so they went ahead proceedings with the notice to the dead assessee on the assumption that the assessee had no business to die without the permission of the Income Tax Officer.
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