Introduction:
In Smt. Asha Dubey v. Union of India through Secretary, Ministry of Finance, Department of Revenue & Others, the Allahabad High Court delivered a significant ruling on the validity of reassessment proceedings initiated against a deceased assessee under the Income Tax Act, 1961. A Division Bench comprising Justice Shekhar B. Saraf and Justice Abdhesh Kumar Chaudhary held that a notice issued under Section 148 in the name of a person who had already died before its issuance is void ab initio. The Court clarified that such a defect is jurisdictional in nature and cannot be cured by invoking Section 292B of the Act, which saves only procedural defects and not actions that strike at the very foundation of jurisdiction.
The dispute arose after the petitioner’s husband, who served as the Chief Management Officer in the Uttar Pradesh Secretariat, jointly purchased a residential flat with his son in Lucknow in October 2020. During a search conducted under Section 132 of the Income Tax Act on the Omaxe Group in April 2021, the Income Tax Department allegedly discovered documents indicating an unaccounted cash payment of approximately ₹25.97 lakh relating to the property transaction.
The assessee passed away on January 7, 2024. Following his death, the petitioner travelled to the United States after completing the funeral rites and returned to India several months later. On the advice of her chartered accountant, she filed her deceased husband’s income tax return in his name, which was verified using his Aadhaar-linked OTP. Subsequently, the Assessing Officer, after obtaining approval from the Principal Commissioner of Income Tax, issued a notice under Section 148 dated March 28, 2025 in the name of the deceased seeking to reopen the assessment for Assessment Year 2021-22. A notice under Section 142(1) followed on January 7, 2026.
The petitioner immediately informed the Department that her husband had already died before the issuance of the notice and objected to the proceedings. However, the Department rejected her objection, substituted her name as legal representative and completed the reassessment, resulting in an additional tax demand of nearly ₹39.67 lakh. Challenging these proceedings, the petitioner approached the Allahabad High Court.
Arguments of the Parties:
The petitioner contended that the very foundation of the reassessment proceedings was illegal because the notice under Section 148 had been issued against a person who was no longer alive. It was argued that jurisdiction under Section 148 can be assumed only after issuing a valid notice to the correct assessee. Since the notice was addressed to a deceased individual, the entire reassessment exercise stood vitiated from its inception.
The petitioner further argued that Section 159 of the Income Tax Act permits proceedings against legal representatives only where proceedings are validly initiated or continued in accordance with law. It does not authorise the Department to issue fresh jurisdictional notices in the name of a deceased person and subsequently substitute the legal heir.
It was also submitted that neither Section 292B nor Section 292BB could validate such a fundamentally defective notice. According to the petitioner, Section 292B cures only minor procedural defects, while Section 292BB applies only where the assessee himself appears in the proceedings without objecting to service. Since the assessee had already died, these provisions were wholly inapplicable.
The Revenue defended its action by contending that it had not been informed about the assessee’s death before issuing the notice. It argued that the petitioner herself had filed the deceased’s income tax return after his death, verified it through Aadhaar OTP and thereby misrepresented that the assessee was alive.
The Department further submitted that once it came to know about the death, it substituted the petitioner’s name as legal representative and continued the reassessment proceedings under Section 159. It argued that any defect in issuing the original notice was merely procedural and stood cured under Section 292B.
The Revenue also attempted to invoke Section 292BB by asserting that the petitioner had participated in the reassessment proceedings and therefore could not subsequently challenge the validity of the notice.
Court’s Judgment:
The Allahabad High Court accepted the petitioner’s challenge and quashed the entire reassessment proceedings. The Court held that a notice under Section 148 issued against a deceased person is void ab initio because it goes to the very root of the Assessing Officer’s jurisdiction.
The Bench observed that Section 148 is the statutory foundation for reopening a completed assessment. Jurisdiction to reassess can arise only upon issuance of a valid notice to the correct assessee. Where the notice itself is addressed to a dead person, the statutory precondition for assumption of jurisdiction remains unfulfilled.
Rejecting the Revenue’s reliance on Section 292B, the Court held that the provision cannot validate an action that is fundamentally without jurisdiction. It explained that Section 292B protects proceedings affected by minor mistakes, defects or omissions, provided they substantially conform to the intent and purpose of the Act. However, issuing a notice to a person who had already died cannot be treated as a procedural irregularity because such a notice is legally non-existent from its inception.
The Court categorically held that the Department could not rely upon Section 159 to continue proceedings initiated through an invalid notice. It clarified that where an assessee dies before issuance of a notice under Section 148, the Department must issue the notice directly to the legal representative in accordance with law. Proceedings initiated against the deceased cannot subsequently be validated merely by substituting the legal heir.
The Bench also rejected the argument that the petitioner was under a statutory obligation to inform the Department about the assessee’s death. It held that the Income Tax Act imposes no such mandatory duty upon legal representatives. Consequently, the Department could not justify its illegal action by alleging absence of prior information regarding the death.
The Court further examined Section 292BB and held that the provision was equally inapplicable. It noted that the section creates a legal fiction only where the assessee himself participates in the proceedings without raising objections regarding service of notice. Since the assessee had already died before issuance of the notice, the primary condition for invoking Section 292BB was absent. The Court also recorded that the petitioner had objected to the validity of the proceedings at the earliest opportunity and had never waived her objections.
While examining the petitioner’s conduct in filing the deceased’s income tax return after his death, the Court observed that such filing appeared contrary to Section 140 of the Income Tax Act. It clarified that the Revenue would remain free to take appropriate action against the petitioner in accordance with law, including proceedings for false verification under Section 277 wherever legally permissible.
However, the Court made it clear that the petitioner’s alleged illegality could not confer jurisdiction upon the Department where none existed. An invalid notice could not be validated merely because the legal representative may have committed an independent violation of the Act.
Emphasising settled principles governing interpretation of taxing statutes, the Bench observed that jurisdictional conditions must be strictly complied with and that equitable considerations have little role in taxation matters. Where the statute prescribes specific conditions before reassessment can be initiated, failure to satisfy those conditions renders the entire exercise void irrespective of the amount of tax allegedly involved.
The Court strongly criticised the conduct of the Income Tax Department, observing that despite being specifically informed about the assessee’s death, it continued with reassessment proceedings and ultimately passed assessment and demand orders against the legal representative. The Bench described the Department’s approach as reflecting a “lackadaisical attitude.”
In one of the most significant observations of the judgment, the Court remarked that taxation necessarily operates upon living persons capable of participating in legal proceedings. It observed that a deceased person cannot receive notice, file objections, participate in assessment proceedings or challenge an adverse order, making proceedings against such a person legally unsustainable.
Holding that the notice under Section 148 was void ab initio, the High Court quashed the reassessment notice as well as every consequential proceeding, including the reassessment order passed under Section 147 and the demand notice issued under Section 156.
The judgment reinforces the principle that jurisdictional requirements under the Income Tax Act cannot be diluted through curative provisions such as Sections 292B or 292BB. It also clarifies that reassessment proceedings initiated after the death of an assessee must begin against the legal representatives themselves and cannot be sustained if commenced in the name of the deceased.