MRS. KHURSHEED DUMASIA LEGAL HEIR OF LATE SH. RUSI KAIKHUSHROO BHUMGARA,MUMBAI vs. INCOME-TAX OFFICER - 19(3)(2), MUMBAI, MUMBAI

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ITA 8041/MUM/2025Status: DisposedITAT Mumbai11 May 2026AY 2017-184 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that an assessment order passed against a deceased person is a nullity and not legally sustainable. Consequently, both the assessment order and the CIT(A)'s order were quashed.

What were the facts?

The Assessing Officer passed an assessment order against a deceased assessee, despite being informed of the death and provided with a death certificate. The legal heir continued to represent the case, but the authorities persisted in proceedings against the deceased.

What were the issues?

Whether an assessment order passed against a deceased assessee is legally valid. Whether proceedings can continue against a deceased person without proper substitution of legal heirs.

Which sections of the Income-tax Act were involved?

Section 144,Section 148,Section 254(1)

AI-generated summary — verify with the full judgment below

PER PAWAN SINGH, JUDICIAL MEMBER;

1.

This appeal by the appellant is filed against the order of CIT(A)dated 22.09.2025

for Assessment Year (A.Y.) 2017-18.The assessee has raised the following

grounds of appeal:

“1. On the facts and the circumstances of the case, the order passed by the Id. CIT(A) is bad on facts and in law.

2.

The order of the Id. CIT(A) is bad in law and vitiated inasmuch as it is passed in the name of the deceased. 3. Without prejudice, the Id. CIT(A) erred in not deciding the legal issue that the Appellant had expired and the assessment made in his name was null and void.

4.

The Id. CIT(A) erred in not holding that the assessment proceedings are without jurisdiction as the alleged notice under section 142(1) calling upon the deceased to file a return was not issued/served as statutorily required.

Mrs. Khursheed Dumasia ITA No. 8041/Mum/2025 (AY 2017-18) 5. The Id. CIT(A) erred in remanding the matter to the AO for making a fresh assessment order in the hands of the Appellant, when such an assessment was legally void for the Deceased-Appellant could not have possibly deposited cash in the bank account after his death and the alleged income is post the death of the Deceased-Appellant.

6.

The Id. CIT(A) erred in remanding the matter to the AO when no such addition could have been made on merits since the exact amount of cash redeposited by the deceased- Appellants daughter in the bank account during the demonetization period was withdrawn earlier from the same bank account during the same financial year.

7.

The Id. CIT(A) ought to have held that no interest was chargeable under sections 234A to 234D of the Act.

8.

The Id. CIT(A) erred in not quashing the initiation of penalty under sections 271AAC, 272A(1)(d) and 271F of the Act.”

2.

Rival submissions of both the parties have been heard and record perused. Shri Percy J. Pardiwalla Advocate Senior Advocate (learned Senior Advocate) submits that assessment was passed against the deceased assessee. The Assessing Officer passed assessment order on 31.10.2019. However, the assessee has expired on 16.01.2012. The Assessing Officer (AO) was informed about the death of assessee vide reply/letter dated 31.10.2019, filed in response to notice dated 23.08.2019, which was issued in the name of deceased assessee Mrs. Khursheed Dumasia. Copy of letter/reply dated 31.10.2019 with copy of death certificate is placed on record. The legal heir/appellant again while filing appeal before the CIT(A) in the statement of fact clearly mentioned that appeal is filed by the legal representative. The death certificate was also filed while filing the appeal. The lower authorities instead of issuing any fresh notice under section 148 in the name of legal heir continued the proceeding against the dead person. The Ld. Senior Counsel submits that it is an admitted position under the law that assessment order passed against dead person is nullity. The Ld. Senior Counsel 2

Mrs. Khursheed Dumasia ITA No. 8041/Mum/2025 (AY 2017-18) submitted that there are series of decisions of different High Courts, wherein it was held that legal heirs have no statutory obligation to intimate death of the assessee to the revenue department. However, in the present case the legal heirs of the assessee intimated the Assessing Officer about the death of the assessee at the initial stage. Therefore, assessment order is to be quashed being invalid. To support his submission, the Ld. Senior Counsel relied upon the decision of Bombay High Court in Devendra vs. JCIT in WP No.5557/2022 dated 13.07.2023 and in Santosh Kanakmal Munot (legal heir of Shri Kanaklal Ramchand Munot) vs. ITO in WP No.4885/2022 dated 29.04.2022. On merit, the learned Senior Counsel submits that AO made addition on account of credit in the Bank account. The impugned bank account was in the joint name of appellant and assessee. The appellant is Non-Resident Indian (NRI) and entire credit in the bank account was explained. 3. On the other hand, the Ld. Sr. DR of the revenue supported the order of lower

authorities.

4.

We have considered the rival submissions of both the parties and have gone through the orders of lower authorities carefully. We have also deliberated on various case laws relied by Ld. Senior Counsel. On perusal of record, we find that AO ompleted assessment on 31.10.2019 under Section 144 of the Act. The AO r while passing the assessment order made addition of Rs.19,00,000/- on account of credit entries in the bank account of assessee. The said bank account in Bank of India is a joint account in the name of Rushi Kaikhushroo Bhumgara. We find that the legal heir of the assessee in response to show-cause notice dated 23.08.2019 issued in the name of deceased assessee, vide her reply dated 31.09.2019 communicated to the AO about the death of the assessee in January

Mrs. Khursheed Dumasia ITA No. 8041/Mum/2025 (AY 2017-18) 2012. The legal heir also furnished his death certificate of assessee. We find that AO in assessment order has nowhere mentioned about such fact. We further, find that while filing appeal before CIT(A) the legal heir again contended that the appeal is filed by legal heir of deceased assessee. The Ld. CIT(A) instead of taking any corrective steps again passed the order in the name of deceased assessee. It is an admitted position under law that any order passed in the name of deceased person is not legally sustainable order. Hence, the assessment order dated 30.10.2019 as well as order of ld CIT(A) dated 22.09.2025 for assessment year 2017-18 is quashed/set aside.

5.

In the result, the appeal raised by the assessee is allowed.

Order pronounced in the open Court on 11/05/2026.

S Sd/- Sd/-

GIRISH AGRAWAL PAWAN SINGH ACCOUNTANT MEMBER JUDICIAL MEMBER

MUMBAI, DATED: 11/05/2026 Aniket, Sr. PS

Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Mumbai; and (5) Guard file. By Order Assistant Registrar ITAT, Mumbai

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