Mayur Traders vs. Principal Commissioner Of CGST And Central Excise

Held

The Court held that an order passed against a deceased person is non est in law. Since the proprietor of the firm had expired even before the order (Annexure P-4) was passed, the order necessarily had to be set aside. The Court acknowledged the petitioner's submission regarding the delay in issuing the order beyond the time provided under Section 73(4B) of the Finance Act, 1994. However, the Court left this question open for consideration in the fresh assessment or if any further challenge is made. The Court reasoned that since the death was not reported, the successor in business could not raise a contention of delay after the proprietor's death. Consequently, the Court set aside Annexure-4 and remanded the matter for fresh consideration before the Assessing Officer, allowing the petitioner to raise objections regarding limitation, including that occasioned even before the death of the proprietor, within one month.

Facts

The petitioner, Mayur Traders, a proprietorship concern, is represented by Binod Kumar Gupta, the successor in business and brother of the deceased proprietor, Arun Kumar Gupta. The proprietor, Arun Kumar Gupta, passed away on April 18, 2021. The impugned notice, Annexure P-4, was issued in the name of the deceased proprietor. The petitioner contends that the notice and subsequent assessment order were issued against a deceased person, rendering them non est in law. The respondents, represented by the Additional Solicitor General, submitted that the order was passed because the death of the proprietor was not reported. The court noted that an order passed against a dead person is legally invalid.

Key Issues

1. Whether an order passed against a deceased proprietor of a proprietorship concern is legally valid and enforceable under the GST regime? 2. Whether the issuance of the order beyond the time provided under Section 73(4B) of the Finance Act, 1994, vitiates the proceedings, considering the death of the proprietor was not reported? The petitioner argued that the order was passed against a dead person, making it void ab initio. They relied on the principle that legal proceedings cannot continue against a deceased individual. The revenue, through the Additional Solicitor General, contended that the order was passed due to the non-reporting of the proprietor's death. Regarding the delay, the revenue argued that there was sufficient reason for the delay as an audit was ongoing. The petitioner also raised the issue of delay in issuance of the order beyond the period prescribed under Section 73(4B) of the Finance Act, 1994, citing the decision in C.W.J.C. No. 18398 of 2023 titled Kanak Automobiles Ltd Vs. Union of India & Others.