TMI Blog1985 (1) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty order, no reference was made that Shri Bibhuti Mishra had died. Further, no show-cause notice was issued in the name of legal representative before levy of penalty in question. The penalty, thus, levied on a dead person without issuing any show-cause notice to the legal representative was obviously an invalid order. 2. The authorised representative stated that the departmental appeal is liable to be dismissed only on this preliminary ground. In this connection, the authorised representative relied upon the following case laws : Shaikh Abdul Kadar v. ITO [1958] 34 ITR 451 (MP). In this case, it was held by their Lordships of the Madhya Pradesh High Court that a notice which was issued in the name of a person who was known to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessments by issuing notices on the remaining legal representatives." 3. The departmental representative argued in connection with the above legal argument that even though no notice was issued to the legal representative, section 159(2)(a) of the Act authorises the department to continue the proceeding taken against the deceased against the legal representative after his death and the proceeding taken against the deceased before his death shall be deemed to have been taken against the legal representative. It was, thus, argued that even though no show-cause notice was issued to the legal representative and the penalty order was passed on a dead person, the order was valid. 4. We have considered the arguments of both the sides. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. Reliance was placed in this connection on the decision of their Lordships of the Patna High Court in the case of CIT v. P.A. Patel [1981] 127 ITR 390. The facts in this case were that the assessee did not show the income of his wife in his return in the bona fide belief that it was not his income and he was not obliged to show the same in his return. Their Lordships of the Patna High Court held in that case as under : " Where the assessee bona fide believes that he is not required to include the income of his wife in his return of income and if the assessee succeeds in showing that he bona fide believed that he is not required to show that income in his return, he succeeds in proving the absence of fraud. Where it is still controversia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the levy of penalty for concealment. 7. We have considered the rival arguments and the facts of the case. We have already held above that the order levying penalty was null and void legally as penalty was levied on a dead person and no show-cause notice was issued to the legal representative. Further we are also of the opinion that even on facts, it was not a fit case for levy of penalty under section 271(1)(c). The assessee was a very old person. The income was taxable in his hands only by a fiction of law and it was not his actual income. The fiction of law was applicable by virtue of an amendment made only one year back. It can reasonably be held that the assessee may not have been aware of the said amendment. The decision of their L ..... X X X X Extracts X X X X X X X X Extracts X X X X
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