TMI Blog1990 (5) TMI 53X X X X Extracts X X X X X X X X Extracts X X X X ..... that the income of the deceased for the accounting period relevant to asst. year 1980-81 had escaped assessment the Income-tax Officer, Nadiad, intending to take action u/s. 147(a) of the Act, issued a notice u/s. 148 of the Act to the deceased. This notice was served on the deceased on 4-2-1982. The deceased however, died on 30-10-1982 without either responding to the said notice or filing the return of his income. After his death Smt. Jayaben Sanabhai, the widow and legal representative of the deceased, filed the return of income of the deceased for the year under consideration on 11-1-1983 declaring his total income at Rs. 48,411. In response to the notice issued by the Income-tax Officer u/s. 143(2) of the Act. Shri Narendrabhai S. Prajapati, the son of the deceased and also the appellant before us, appeared with books of account of the assessee for the year under consideration. He brought to the notice of the Income-tax Officer that the deceased had expired on 30-10-1982 and that the return of his income had been signed by his mother Smt. Jayaben Sanabhai as legal heir of the deceased. Despite that information, the Income-tax Officer finalised the assessment u/s. 147(a) read ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al against the penalty order passed u/s. 273(1)(b) has given rise to ITA No. 495/Ahd./1987. 5. We have heard the learned representatives of the parties at sufficient length and went through the records as was made available to us. We have also gone through the cases relied upon by the learned representatives of the parties. On the facts stated above, the position of law being well established we have no difficulty in observing that the orders as passed by the learned AAC in these appeals are not sustainable even for a moment. 6. In so far as the appeal against the order confirming the levy of penalty u/s. 271(1)(a) is concerned, suffice it to say that the assessment order whereupon the impugned penalty order was based was, on the face of it, quite void and illegal. We must stress that it was not disputed before us that the assessment in this case had been made on a dead person. When an objection against the very validity and legality of the assessment order was raised before the learned AAC, he decided such objection on the following lines : " 4.2. In a detailed submission made, the representative of the appellant has tried to state that the penalty notice and penalty order a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , his executor was not liable to pay the tax and that if the death occurred while assessment proceedings were pending, the proceedings could not be continued and the assessment could not be made after the person's death.This view of the Bombay High Court led the Legislature to introduce sec. 24B in the 1922 Act in 1933. Sec. 24B corresponds to sec. 159 of the present Act. The relevant part of sec. 159 reads as under :-- " 159. (1) Where a person dies, his legal representative shall be liable to pay any sum which the deceased would have been liable to pay if he had not died, in the like manner and to the same extent as the deceased. (2) For the purpose of making an assessment (including an assessment, reassessment or recomputation under section 147) of the income of the deceased and for the purpose of levying any sum in the hands of the legal representative in accordance with the provisions of sub-section (1)-- (a) any proceeding taken against the deceased before his death shall be deemed to have been taken against the legal representative and may be continued against the legal representative from the stage at which it stood on the date of the death of deceased ; (b) any pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceedings may be taken against the legal representative of the deceased under the provisions of sub-clause (b) of seb-sec.(2) of sec. 159. It is clearly inferred that assessment under the Act can only be made against an individual assessee who must be a living person. 9. In the case of CIT v. Amarchand N. Shroff [1963] 48 ITR 59 the Supreme Court held that the individual has ordinarily to be a living person and there could be no assessment on a dead person. With regard to the legal fiction, as has been created u/s. 159 of the Act, their Lordships of the Supreme Court referring to their earlier decision in the case of Bengal Immunity Co. Ltd. v. State of Bihar (sic.) observed that legal fictions are only for a definite purpose for which they are created and should not be extended beyond that limited field. The same principle was reiterated by the Supreme Court in the case of First Addl. ITO v. Mrs. Suseela Sadanandan [1965] 57 ITR 168 where it was held that on the death of a person the Income-tax Officer has to proceed against the executor and/or legal representative of the deceased. The proposition laid down by the Supreme Court in the above cases was followed by the Calcutta High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... less ground that the appellant had accepted the assessment order. We may observe that ours is an adversary system of administration of justice. In such system adherence to principle of natural justice, as recognised by all civilised States is of great importance, especially when quasi judicial bodies embark on determining certain disputes between the parties. The first and foremost principle which is commonly known is that of audi alterum partem rule. It says that none should be condemned unheard. Notice is the first limb of this rule. When in our system of administration of justice we adhere to this principle of hearing a living person before passing any order against him, how can we ignore the necessity of representation in the case of a dead person whose estate is to be adversely affected by the order likely to be passed ? That is why an assessment made on a dead person would be a nullity in law and void ab initio. As stated above, a thing which is void is non est and it is not necessary to set that aside as it has no effect in the eye of law. The assessment made on the deceased in the present case may conveniently be ignored for that reason. 12. The learned Departmental Repre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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