Lucknow, Jul 23 In a significant ruling, the Allahabad High Court held on Thursday that an income tax reassessment notice issued in the name of a deceased person is "void ab initio" (void from the beginning) and cannot be validated later by substituting the legal heir or treating it as a procedural defect.
Quashing the reassessment proceedings and the consequential tax demand, the Lucknow bench of the court also urged Parliament to consider amending the law to address the legislative gaps exposed by such cases.
It directed that a copy of the judgment be forwarded to the Union finance ministry for appropriate consideration.
The order was passed by a bench of Justices Shekhar B Saraf and Abdhesh Kumar Chaudhary while allowing a writ petition filed by Asha Dubey.
According to the petition, the petitioner's husband, Sanjay Dubey, died in January 2024. Despite his death, the income-tax department issued a notice under section 148 of the Income Tax Act in March 2025, alleging undisclosed cash transactions of Rs 27.44 lakh detected during a search on the Omaxe Group.
The department claimed that the amount represented cash paid by the deceased towards the purchase of a flat.
It subsequently proceeded against his widow as the legal heir and raised a tax demand of about Rs 39.67 lakh.
The bench held that a valid notice under section 148 of the Act is the foundation of reassessment proceedings.
A notice issued in the name of a dead person suffers from an inherent jurisdictional defect that cannot be cured under section 292B of the Act, it said.
The court further clarified that proceedings against a legal representative under section 159 of the Act are permissible only if valid proceedings were already initiated during the lifetime of the assessee.
The court also observed that although filing an income-tax return in the name of a deceased person after his death may have legal consequences, such an act cannot confer jurisdiction upon the tax authorities or validate an otherwise void notice. The bench said courts cannot fill legislative gaps by judicial interpretation, as that falls within the Parliament's domain.
