Md. Salim Khan and ors. Vs. Income-tax Officer and ors. - Court Judgment

Excerpt:
- - cit wherein, out of ten legal representatives, only one had been notified by the concerned authorities because of which the assessment order was held to be bad. in the present case, however, we find that the income-tax officer had good reason to believe because of the information supplied by the authorised representative of the deceased assessee that he was succeeded by his wife and three sons who were duly notified about the proceeding. as to this view, we would like to say that as the income-tax officer had acted on the basis of the information given by the authorised representative of the deceased though in connection with the proceeding under the gift-tax act, the bona fides of the income-tax officer cannot be doubted. we are, therefore, satisfied, that in the present case the income-tax officer did not commit any manifest error of law in issuing notice only on the four legal representatives of the assessee. 9. in view of all the above, we are satisfied that the assessment in the present case cannot be regarded to be a nullity because notices were issued only on four legal representatives of the late israil khan. we do not find any failure of justice in the present case on the above ground to merit invocation of our power under article 226 of the constitution to set aside the assessment orders rendered after having issued notices on the four legal representatives of the assessee. we are, therefore, not satisfied that a case has been made out to set aside the impugned orders. b.l. hansaria, j. 1. these petitions by the legal representatives of one late israil khan challenge the validity of the assessment orders passed by the income-tax officer relating to different assessment years. the occasion for approaching this court was the issue of notice to the legal representatives by the tax recovery officer, dibrugarh, to pay the dues. the contention, in all these writ petitions, is that as all the legal representatives of the late israil khan, who are said to be 10 in number, were not served with notices under section 143 of the income-tax act (hereinafter 'the act'), the assessments were null and void and no payment could be demanded on the basis of such assessment orders. 2. in so far as the factual aspect of the case is concerned, it may be stated that the late israil khan died on september 24, 1971, and was governed by the sunni school of mohammadan law. it is also an admitted position that in all the proceedings, one wife and three sons of the late israil khan were made parties and were served notices under section 143(2) of the act. the contention of the writ petitioners, however, is that as israil khan had left 10 heirs, issuance of notice on four of them alone did not satisfy the requirement of law and the assessments made without issuing notices on all the legal representatives are not tenable in law. 3. the aforesaid facts are not in dispute. it is, however, the contention of the department that notices were issued only on the wife and three sons of the late israil khan inasmuch as in the course of a proceeding under the gift-tax act (the gift-tax officer was also the income-tax officer) information was furnished by the authorised representative, mr. tibrewal, on august 30, 1974, that the late israil khan had left the following legal representatives : (1) bunnat khatoon, wife of late israil khan. (2) ayub khan, son of late israil khan. (3) salim khan, son of late israil khan. (4) yusuf khan, son of late israil khan. 4. it is because of this that the income-tax officer issued notices on the aforesaid four persons. it is, therefore, contended by shri choudhury for the revenue that the income-tax officer had every reason to believe bona fide that israil khan had left the aforesaid four legal representatives only. shri saraf, however, brings to our notice annexure-d to the affidavit-in-opposition filed by the department in civil rule no. 529 of 1980 which shows that as per israil khan himself, his family members consisted of his wife, four sons and two daughters. this information was given some time in 1970. learned counsel, therefore, states that even as per the records maintained by the department, notices must have been issued on at least seven persons if not ten. as to this, the reply of shri choudhury is that out of the four sons, one had died some time in 1972 and two daughters were minors at the relevant time. in so far as the minor daughters are concerned, it is submitted by shri choudhury that they were duly represented by their mother. in this connection, our attention has been invited to the gift-tax return filed by israil khan for the assessment year 1968-69 in which three minor sons were said to have been represented by their mother and guardian, bunnat khatoon. it is because of this that notices were issued only on the wife and three sons of israil khan. this being the position, we are of the view that when notices were issued on four legal representatives only of the deceased, it cannot be held that the income-tax officer had acted without diligence or had not applied his mind to this aspect of the case properly and duly. 5. in this connection, shri saraf refers to jai prakash singh v. cit wherein, out of ten legal representatives, only one had been notified by the concerned authorities because of which the assessment order was held to be bad. as to this case shri choudhury contends that the same is different on facts inasmuch as information had been given to the concerned authority in the aforesaid case that shri b.n. singh who was the assessee in the case had died leaving behind ten legal representatives. this information had been given soon after his death. despite this, no enquiry was made and only one legal representative was given notice. in the present case, however, we find that the income-tax officer had good reason to believe because of the information supplied by the authorised representative of the deceased assessee that he was succeeded by his wife and three sons who were duly notified about the proceeding. it may be that this information was given in connection with the assessment under the gift-tax act. but, as at the relevant time, the gift-tax officer was performing the duties of the income-tax officer also, he acted on the information made available to him qua gift-tax officer. we do think that, in doing so, the income-tax officer acted bona fide.6. our attention has also been invited by learned counsel for the assessee to cit v. rahima bi : [1977]107itr810(mad) where, on the death of the assessee, notice was issued only to the mother as de facto guardian of the minor children. this notice was not regarded as sufficient because under the mohammadan law only the father or father's father could have been regarded as guardian. this decision has no application to the facts of the present case inasmuch as no notice was issued on the minors showing the mother as de facto or de jure guardian of the minors. even if this had been done, we would have found no fault with the taxing authorities in view of the statement of israil khan himself referred to earlier that his minor sons were being represented by their mother. 7. our attention has been invited by shri saraf to chooharmal wadhuram v. cit : [1971]80itr360(guj) also, in which it was held by the gujarat high court that if the income-tax officer makes a bona fide and diligent enquiry, the leaving out of some of the heirs would not make the assessment null and void. learned counsel states that in the present case there was no enquiry not to speak of the enquiry being diligent and bona fide. as to this view, we would like to say that as the income-tax officer had acted on the basis of the information given by the authorised representative of the deceased though in connection with the proceeding under the gift-tax act, the bona fides of the income-tax officer cannot be doubted. in the facts of the present case, after the aforesaid information was given, it would not have been thought necessary to hold any further enquiry by the income-tax officer. we are, therefore, satisfied, that in the present case the income-tax officer did not commit any manifest error of law in issuing notice only on the four legal representatives of the assessee. 8. the question is whether on the basis of notice on some of the heirs tax can be realised from the other representatives or not. in this connection, shri choudhury has first drawn our attention to kadir mohideen marakkayar v. n.v. muthukrishna ayyar ilr [1903] mad 230 in which it was held that if the legal representatives brought on record sufficiently represent the estate of the deceased, in the absence of any fraud or collusion, the decree passed in such suit will bind such estate. we are thereafter referred to daya ram v. shyam sundari, : [1965]1scr231 wherein it was observed at page 1054, that it has been the consensus opinion of all the high courts of the country that where a plaintiff or an appellant after diligent and bona fide enquiry ascertains who the legal representatives of a deceased defendant or respondent are and brings them on record within the time limited by law, there is no abatement of the suit or appeal; that the impleaded legal representatives sufficiently represent the estate of the deceased and that a decision obtained with them on record will bind not merely those impleaded but the entire estate including those notbrought on record, this decision was referred to with approval in ito v. maramreddy sulochanamma : [1971]79itr1(sc) . in this connection, reference was also made to first additional ito v. suseela sadanandan : [1965]57itr168(sc) in which it was held that if a person dies executing a will appointing more than one executor or dies intestate leaving behind more than one heir, the income-tax officer has to proceed to assess the total income of the deceased against all the executors or all the legal representatives, as the case may be. though this is the legal requirement, for reasons already given, there is no legal flaw in the present case in having issued notices on four legal representatives only of the deceased. 9. in view of all the above, we are satisfied that the assessment in the present case cannot be regarded to be a nullity because notices were issued only on four legal representatives of the late israil khan. we do not find any failure of justice in the present case on the above ground to merit invocation of our power under article 226 of the constitution to set aside the assessment orders rendered after having issued notices on the four legal representatives of the assessee. we are, therefore, not satisfied that a case has been made out to set aside the impugned orders. the petitions are, therefore, dismissed.

Judgment:

B.L. Hansaria, J.

1. These petitions by the legal representatives of one late Israil Khan challenge the validity of the assessment orders passed by the Income-tax Officer relating to different assessment years. The occasion for approaching this court was the issue of notice to the legal representatives by the Tax Recovery Officer, Dibrugarh, to pay the dues. The contention, in all these writ petitions, is that as all the legal representatives of the late Israil Khan, who are said to be 10 in number, were not served with notices Under Section 143 of the Income-tax Act (hereinafter 'the Act'), the assessments were null and void and no payment could be demanded on the basis of such assessment orders.

2. In so far as the factual aspect of the case is concerned, it may be stated that the late Israil Khan died on September 24, 1971, and was governed by the Sunni School of Mohammadan law. It is also an admitted position that in all the proceedings, one wife and three sons of the late Israil Khan were made parties and were served notices under Section 143(2) of the Act. The contention of the writ petitioners, however, is that as Israil Khan had left 10 heirs, issuance of notice on four of them alone did not satisfy the requirement of law and the assessments made without issuing notices on all the legal representatives are not tenable in law.

3. The aforesaid facts are not in dispute. It is, however, the contention of the Department that notices were issued only on the wife and three sons of the late Israil Khan inasmuch as in the course of a proceeding under the Gift-tax Act (the Gift-tax Officer was also the Income-tax Officer) information was furnished by the authorised representative, Mr. Tibrewal, on August 30, 1974, that the late Israil Khan had left the following legal representatives :

(1) Bunnat Khatoon, wife of late Israil Khan.

(2) Ayub Khan, son of late Israil Khan.

(3) Salim Khan, son of late Israil Khan.

(4) Yusuf Khan, son of late Israil Khan.

4. It is because of this that the Income-tax Officer issued notices on the aforesaid four persons. It is, therefore, contended by Shri Choudhury for the Revenue that the Income-tax Officer had every reason to believe bona fide that Israil Khan had left the aforesaid four legal representatives only. Shri Saraf, however, brings to our notice annexure-D to the affidavit-in-opposition filed by the Department in Civil Rule No. 529 of 1980 which shows that as per Israil Khan himself, his family members consisted of his wife, four sons and two daughters. This information was given some time in 1970. Learned counsel, therefore, states that even as per the records maintained by the department, notices must have been issued on at least seven persons if not ten. As to this, the reply of Shri Choudhury is that out of the four sons, one had died some time in 1972 and two daughters were minors at the relevant time. In so far as the minor daughters are concerned, it is submitted by Shri Choudhury that they were duly represented by their mother. In this connection, our attention has been invited to the gift-tax return filed by Israil Khan for the assessment year 1968-69 in which three minor sons were said to have been represented by their mother and guardian, Bunnat Khatoon. It is because of this that notices were issued only on the wife and three sons of Israil Khan. This being the position, we are of the view that when notices were issued on four legal representatives only of the deceased, it cannot be held that the Income-tax Officer had acted without diligence or had not applied his mind to this aspect of the case properly and duly.

5. In this connection, Shri Saraf refers to Jai Prakash Singh v. CIT wherein, out of ten legal representatives, only one had been notified by the concerned authorities because of which the assessment order was held to be bad. As to this case Shri Choudhury contends that the same is different on facts inasmuch as information had been given to the concerned authority in the aforesaid case that Shri B.N. Singh who was the assessee in the case had died leaving behind ten legal representatives. This information had been given soon after his death. Despite this, no enquiry was made and only one legal representative was given notice. In the present case, however, we find that the Income-tax Officer had good reason to believe because of the information supplied by the authorised representative of the deceased assessee that he was succeeded by his wife and three sons who were duly notified about the proceeding. It may be that this information was given in connection with the assessment under the Gift-tax Act. But, as at the relevant time, the Gift-tax Officer was performing the duties of the Income-tax Officer also, he acted on the information made available to him qua Gift-tax Officer. We do think that, in doing so, the Income-tax Officer acted bona fide.

6. Our attention has also been invited by learned counsel for the assessee to CIT v. Rahima Bi : [1977]107ITR810(Mad) where, on the death of the assessee, notice was issued only to the mother as de facto guardian of the minor children. This notice was not regarded as sufficient because under the Mohammadan law only the father or father's father could have been regarded as guardian. This decision has no application to the facts of the present case inasmuch as no notice was issued on the minors showing the mother as de facto or de jure guardian of the minors. Even if this had been done, we would have found no fault with the taxing authorities in view of the statement of Israil Khan himself referred to earlier that his minor sons were being represented by their mother.

7. Our attention has been invited by Shri Saraf to Chooharmal Wadhuram v. CIT : [1971]80ITR360(Guj) also, in which it was held by the Gujarat High Court that if the Income-tax Officer makes a bona fide and diligent enquiry, the leaving out of some of the heirs would not make the assessment null and void. Learned counsel states that in the present case there was no enquiry not to speak of the enquiry being diligent and bona fide. As to this view, we would like to say that as the Income-tax Officer had acted on the basis of the information given by the authorised representative of the deceased though in connection with the proceeding under the Gift-tax Act, the bona fides of the Income-tax Officer cannot be doubted. In the facts of the present case, after the aforesaid information was given, it would not have been thought necessary to hold any further enquiry by the Income-tax Officer. We are, therefore, satisfied, that in the present case the Income-tax Officer did not commit any manifest error of law in issuing notice only on the four legal representatives of the assessee.

8. The question is whether on the basis of notice on some of the heirs tax can be realised from the other representatives or not. In this connection, Shri Choudhury has first drawn our attention to Kadir Mohideen Marakkayar v. N.V. Muthukrishna Ayyar ILR [1903] Mad 230 in which it was held that if the legal representatives brought on record sufficiently represent the estate of the deceased, in the absence of any fraud or collusion, the decree passed in such suit will bind such estate. We are thereafter referred to Daya Ram v. Shyam Sundari, : [1965]1SCR231 wherein it was observed at page 1054, that it has been the consensus opinion of all the High Courts of the country that where a plaintiff or an appellant after diligent and bona fide enquiry ascertains who the legal representatives of a deceased defendant or respondent are and brings them on record within the time limited by law, there is no abatement of the suit or appeal; that the impleaded legal representatives sufficiently represent the estate of the deceased and that a decision obtained with them on record will bind not merely those impleaded but the entire estate including those not

brought on record, This decision was referred to with approval in ITO v. Maramreddy Sulochanamma : [1971]79ITR1(SC) . In this connection, reference was also made to First Additional ITO v. Suseela Sadanandan

: [1965]57ITR168(SC) in which it was held that if a person dies executing a will appointing more than one executor or dies intestate leaving behind more than one heir, the Income-tax Officer has to proceed to assess the total income of the deceased against all the executors or all the legal representatives, as the case may be. Though this is the legal requirement, for reasons already given, there is no legal flaw in the present case in having issued notices on four legal representatives only of the deceased.

9. In view of all the above, we are satisfied that the assessment in the present case cannot be regarded to be a nullity because notices were issued only on four legal representatives of the late Israil Khan. We do not find any failure of justice in the present case on the above ground to merit invocation of our power under article 226 of the Constitution to set aside the assessment orders rendered after having issued notices on the four legal representatives of the assessee. We are, therefore, not satisfied that a case has been made out to set aside the impugned orders. The petitions are, therefore, dismissed.