Law: Income Tax Act, 1922

Section: 24B(2)

Section 56(1), read with section 24B(2), of the Indian Income-tax Act, 1922, - Collection and recovery of tax-penalty - Payable when tax in default - Assessment years 1944-45, 1946-47 and 1950-51 - Penalty under section 46(1) was imposed on petitioner who was legal representative of deceased for his failure to pay said demands - Whether in case of an assessee under section 24B liability is not merely to assessment but also to enforcement of that liability under relevant provisions of Act including liability to penalty under section 46(1) and to enforcement of liability under section 46(2) - Held, yes - Whether default by reason of which penalty was imposed on petitioner was not default of deceased in payment of income-tax due but of legal representative himself, and, therefore, there could be nothing illogical or illegal in penalty being imposed on person whose default it was - Held, yes - Whether impugned penalty could be imposed on legal representative where tax due under assessment made on his deceased predecessor or under assessment made against him under section 24B was not paid and default was committed - Held, yes FACTS The father of the petitioner, was assessed to income-tax for the assessment year 1944-45 on 28-3-1949. Father, after paying a part of the tax demand, died, leaving balance to be paid by his legal representative. For the assessment years 1946-47 and 1950-51, the petitioner was assessed under section 24B, on the income of his father, during those years, resulting in arrears of tax remaining due. The tax demands were on appeal, reduced to some extent. Therefore, the ITO imposed penalties under section 46(1) in respect of the assessment years 1944-45, 1946-47 and 1950-51. As the taxes outstanding in respect of which the penalties were imposed had not been paid, the appeal filed by the petitioner were dismissed by the AAC. Further appeals to the Tribunal also met the same fate. On writ petition the petitioner contended (1) that the penalty order having been passed against a dead person were a nullity and (2) that no penalty order could be passed against a legal representative in respect of a tax demand against a deceased assessee. HELD Penalty…

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