Allowed

Mrs.Kontham Sugunalatha v. The Assessment Unit, National Faceless Assessment Centre (Nfac)

Telangana HC21 Nov 2024WP/22086/2024

Case brief

AI extract

What is this about?

This Common Order dismisses writ petitions challenging assessment and penalty orders issued by the Income Tax Department against a deceased individual. The High Court relied on a Delhi High Court precedent to hold that such orders against a dead person cannot withstand judicial scrutiny and set them aside.

What did the court decide?

The Assessment Order dated 13.02.2024 and Penalty Order dated 29.06.2024 are set aside. Liberty is reserved to the Revenue Department to proceed against the legal representatives of the deceased.

Mrs.Kontham Sugunalatha Vs The Assessment Unit, National… — Income Tax | Telangana HC (2024)

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[³⁴¹¹ ]

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IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction)

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THURSDAY, THE TWENry FRST DAYOFNOVEMBER TWO THOUSAND AND TWENTY FOUR

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PRESENT

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THE HONOURABLE SRI JUSTICE SUJOY PAUL AND THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO

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WRIT PETITION Nos:22 070 & 22086 0F 2024

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WRIT PETITION NO: 22o70 0F 2024:

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Between:

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firlrs. Kontham Sugunalatha, wife and Legal Heir of Late Dr.Kontham Eashwar {a1 Qgry.qnq1a.yana,^{Aged about 60 yearsl Occ. Househoid, neslaent} oiX.iro. 2-1-40013, St.No. 3, New Nallakunta, Hyderabad.

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...PETITIONER

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AND

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1 The Assessment Un_it, National Faceless Assessment Centre (NFAC), Rep. by its Principle Chief Commissioner of lncome Tax, Room No +Ot Zni ftoor e Ramp Jawaharlal Nehru Stadium, Delhi 1100O3.

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2 The lncome Tax Officer, \N ard - 2, Nizamabad, Nizamabad District, Telangana.

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The Union.of lndia,-Rep. by its Secretary, Ministry of Finance, Government of lndia, North Block, New Delhi - 110 001.

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...RESPONDENTS

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Petition under Article 226 of the constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High court may be pleased to issue an appropriate writ, order or Direction, more particularly one in the nature of writ of Mandamus, to declare the action of the 1st Respondent in issuing the lmpugned Assessment order dated 1312tm24 for the Assessment Year 2016-17 as per Section 147 Read with section 144 and 1448 of the lncome Tax Act^'1961 against a dead person Dr.Kontham Eashwar Jai Suryanarayana on the ground of non-filing of the returns of income and demanding ior payment of tax Rs.46,73,976/-, without prior notice and affording reasonable opportunity of being heard against legal heirs of the dead person as being illegal, arbitriry,l patently barred by limitation, without Jurisdiction, contrary to the provisions of section 148 and section 148A of the lncome Tax Act,1961 and consequenfly set aside the Assessment order dated 1310212024, passed for the Assessment year 2016-17 under the lncome Tax Act,1961 as null and void.

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lA NO: 1 OF 2024

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Petition under Section 151 CPC^praying that^{in the circumstancesstated in} the affidavit filed in support of the^{petition,the HighCourt may be pleasedto} suspend the operation of the lmpugned^{Assessment Order dated 131212O24} issued by the 1't Respondent for the Assessment^{Year 2016-17 under the lncome} Tax Act.196t,^pending disposal of the above^{Writ Petition,as otherwise lwill be} put to irreparable loss and hardship.

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Counsel for the Petitioner: SRI SHAIK VAHEEDA SUSHMA

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Counsel for the Respondent No.1 & 2: M/s. J.^{SUNITHA(JR. Sc FoRlNcoME TAx)} rep. for SRI P. MURALI KRISHNA, SR, SC FOR INCOME TAX DEPARTMENT

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Counsel for the Respondent No.3: SRI GADI^{PRAVEEN KUMAR,} DY. SOLICITOR GENERAL OF INDIA

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WRIT PETITION NO: 22086 OF 2024:

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Between:

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Mrs.Kontham Sugunalatha, Wife and Legal Heir of Late Dr.Kontham Eashwar Jai Suryanarayana, aged about 60^years, Occ. Household, Resident of H.No. 2-1-40013, St.No. 3, New Nallakunta, Hyderabad.

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...PETITIONER

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AND

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1 The Assessment Unit, National Faceless Assessment Centre^(NFAC), Rep. by its Principle Chief Commissioner of lncome Tax, Room No 401 2nd Floor E Ramp Jawaharlal Nehru Stadium Delhi¹ 10003

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The lncome Tax Officer, Ward 2, Nizamabad. Nizamabad District, Telangana.

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3 The Union of lndia, Rep. by its Secretary, Ministry of Finance, Government of India, North Block, New Delhi 110 001.

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...RESPONDENTS

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Petition under Article 226 oI the Constitution of lndia^praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue an appropriate writ order or Direction, more particularly one in the nature of Writ of Mandamus, to declare the action of the l st Respondentⁱⁿ issuing the lmpugned Penalty Order dated 29-6-2024 under Section 271⁽¹⁾ @) of the lncome Tax Act 1961 for the Assessment Year 2016-17 against a dead person Dr.Kontham Eshwar Jai Suryanarayana on the ground of non-filing of the returns of income and demanding for payment of Penalty of Rs. 14,26,6531, without prior notice and affording reasonable opportunity of being heard against legal heirs of the dead person as being illegal, arbitrary, patently barred by limitation, without Jurisdiction, contrary to the Provisions of the lncome Tax Act,'1961 and consequently set aside the Penalty Order dated 29.06.2024, passed

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for the Assessment Year 2016-17 under the Income Tax Act,1961 as null and void.

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IANO:1O F 2024

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Petition under section 151 cpc praying that in the circumstances stated in the affidavit fired in support of the peiition, in" Hign court may u" pr"r"Lo t" suspend the operation of the rmpugned penarty. order dated ze-6-zoz[ iis"ia ov the 1st Respondent, for the Asseisment year 201 .6-17 under the tn"or" r* Act' 1 961 , pending disposar of the above writ petition, as otherwise r wirt G put to irreparable loss and hardship.

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Counsel for the Petitioners: SRI SHAIK VAHEEDA SUSHMA

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counser for the Respondent No.1 & 2: M/s. J. suNrrHA (JR. SC FOR TNCOME TAX) !"{ J3',8H,'";tsHEiX-1T 3X$*.,,

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Counsel for the Respondent No.3: SRI cADl PRAVEEN KUMAR,

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DY. SOLICITOR GENERAL OF INDIA

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The Court made the following: COMMON ORDER

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THE HONOURABLE^{SRI JUSTICESUJOY PAUL}

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AND

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THE HONOURABLE^{SRI JUSTICENAMAVARAPURAJESHWAR RAO} WRIT PETITION Nos.22 070^{&220A6 of 2o24}

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COMMON ORDER^{(per Hon'ble SP,J)}

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. Ms. Shaik Vaheeda^{Sushma, learned counsel forthe} petitioner, Ms. J.Sunitha,^{Iearned Junior StandingCounsel} representing Sri P. Murali^{Krishna, learned SeniorStandingCounsel} for Income Tax^{Department,for respondentNos.1 and 2 and Sri B'} Mukherjee, learned^{counsel representingSri GadiPraveen Kumar,} learned Deputy Solicitor^{General of India, for respondent No 3'}

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2 With the consent finallY^heard

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karned counsel for the^{petitionerraised singular} submission. She submits^{that inW.P.No.22O7Oof 2024, the} Assessment Order dated^{13.O2.2024is subject matterof challenge,} whereas the consequential^{Penalty Order. dated 29.06'2024is being} questioned in W.P.No.22O86 of 2024.^{The singular ground is that the} assessee expired on 26.O2.2016-^{The impugned Assessment} Proceedings and Assessment Order^{could not have been passed} against a dead^{person. Similarly, the impugned PenaltyOrdercould} not have been issued against^{a dead person.Relianceis placed on a} judgment of Delhi High Court in Savita Kapila v. Assistant Commissioner of Income Tax, Circle 43(11 Delhil.

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r 2o2o scc online Del 2540

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Learned Junior Standing Counsel for Income Tax Department opposed the prayer and supported the impugned Assessment and Penalty Orders. However, she could not point out or distinguish the aforesaid judgment of Delhi High Court.

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We are in respectful agreement with the view taken by the Delhi High Court in Savita Kapila (supra). In the tight of said judgment, the impugned Assessment Order and penalty Order cannot sustain judicial scrutiny.

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Resultantly, both the orders dated 73.02.!024 and 29 .06.2024 are set aside. Liberty is reserved to the Revenue Department to proceed against the legal representatives of the deceased assessee, if law so permits.

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7 The Writ Petitions are disposed of. No costs

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Interlocutory applications, if any pending, shall also stand

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closed.

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SD/.A.V.S.PRASAD ASSISTANT REGISInAR //TRUE C)pytt V

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To,

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SECTION OFFICER