Ashwani Kumar Panday vs. State Of U.P. Thru. Prin. Secy. Deptt. Lko. And 2 Others

Held

The Court held that proceedings cannot be initiated against a deceased person. The show cause notice and the impugned order passed under Section 73 of the Act were unsustainable because they were issued against a deceased individual without proper notice to the legal heirs. The Court followed the principle laid down in the case of Amit Kumar Sethia (Deceased) vs. State of U.P. and another, which stated that while Section 93 of the Act deals with the liability of legal representatives, it does not authorize determination against a dead person. The Court reasoned that it is essential to issue a show cause notice to the legal representative before any determination can take place. Consequently, the show cause notice dated May 21, 2024, and the order dated August 21, 2024, were quashed and set aside. The respondent authorities were granted liberty to proceed against the petitioner in accordance with law, if advised.

Facts

The petitioner, son of the deceased proprietor of M/S Pandey Iron Dealer, Ram Prasad Panday, filed a writ petition challenging an order dated August 21, 2024, passed by respondent no. 3. The order, issued under Section 73 of the U.P.G.S.T. Act, 2017, demanded Rs. 42,63,155.00 (Tax Rs. 21,68,000.00, Interest Rs. 18,78,355.00, and Penalty Rs. 2,16,800.00) against the deceased Ram Prasad Panday for the tax period April 2019 to March 2020. Ram Prasad Panday died on February 06, 2021. His GST registration was cancelled on June 27, 2023, after his death. Despite knowledge of the death, a show cause notice was issued on May 21, 2024, and an ex parte order was passed on August 21, 2024. Both were uploaded on the portal, and the legal heirs were allegedly unaware.

Key Issues

1. Whether proceedings under Section 73 of the U.P.G.S.T. Act, 2017, can be initiated and an order passed against a deceased person, when the authorities have knowledge of the death and the registration has been cancelled. (Question of law) Petitioner's arguments: The proceedings are bad in law as they were initiated against a deceased person. Information regarding the death was provided to the authorities. The show cause notice and the impugned order were passed against a dead person, which is unsustainable. Reliance was placed on the Division Bench judgment in Amit Kumar Sethia (Deceased) vs. State of U.P. and another, which held that determination cannot be made against a dead person and that legal representatives must be issued a show cause notice. Revenue's arguments: No arguments were recorded for the revenue.