Under GST provisions determination of tax can not take place against a deceased person. Section 93 only deals with liability to pay tax
In a recent judgment, Allahabad High Court has held that under GST provisions determination of tax can not take place against a deceased person. The provisions only deal with the liability to pay tax, interest or penalty in a case where the business is continued after the death, by the legal representative or where the business is discontinued.
ABCAUS Case Law Citation:
4553 (2025) (05) abcaus.in HC
In the instant case, the Petitioners was aggrieved by the ex-parte order passed under Section 73(9) of the Goods and Services Tax Act, 2017 (‘the Act’) raising a demand in the name of deceased husband of the Petitioner.
The petitioner(s) were wife and son, respectively of deceased who was a proprietor of a firm registered under GS. The Petitioners have filed the Petition claiming themselves to be legal representatives of the deceased proprietor inter alia with the submissions that the said proprietor had died five years before a show cause notice (SCN) was issued in the name of deceased under Section 73 of the Act.
It was submitted that since the SCN was uploaded on the portal, there was no occasion for the petitioners to have accessed the said portal. As a result, the show cause notice remained unanswered which resulted in passing of the impugned order raising demand against the deceased.
The Department supported the order impugned with the aid of provisions of Section 93 of the Act. It was submitted that under the provisions of Section 93, the recovery can be made from the legal representatives even after the determination has been made after the death of the proprietor of the firm.
The Hon’ble High Court observed that a perusal of the provisions of section 93 of the Act would reveal that the same only deals with the liability to pay tax, interest or penalty in a case where the business is continued after the death, by the legal representative or where the business is discontinued, however, the provision does not deal with the fact as to whether the determination at all can take place against a deceased person and the said provision cannot and does not authorise the determination to be made against a dead person and recovery thereof from the legal representative.
The Hon’ble High Court opined that once the provision deals with the liability of a legal representative on account of death of the proprietor of the firm, it is sine qua non that the legal representative is issued a show cause notice and after seeking response from the legal representative, the determination should take place.
The Hon’ble High Court held that the determination made in the present case wherein the show cause notice was issued and the determination was made against the dead person without issuing notice to the legal representative, cannot be sustained.
Consequently, the writ petition was allowed. The impugned order was quashed and set aside. The Department was given liberty to take appropriate proceedings in accordance with law.
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