THE COMMISSIONER OF INCOME TAX, COCHIN vs. SHRI.V.M.VARGHESE
What did the High Court hold?
The High Court held that the appeal had abated due to the death of the assessee. The Court rejected the Revenue's applications for setting aside the abatement and condonation of delay. The reasoning was based on the evidence presented by the assessee's son, which clearly indicated that the Income Tax Department, including the Tax Recovery Officer, was aware of the assessee's death much before the applications were filed. The Tax Recovery Officer had even communicated a demand to the deceased assessee's wife, giving effect to the ITAT's order, which implies knowledge of the assessee's demise. The Court found no satisfactory explanation for the gross delay of 3345 days in filing the applications. Consequently, the appeal was dismissed as abated. The Court explicitly stated that the question of law would be considered in appropriate proceedings, implying that the merits of the appeal were not decided.
What were the facts?
The appeal was filed by the Commissioner of Income Tax, Kochi against an order of the ITAT, Cochin Bench. The assessee, V.M. Varghese, passed away. The Revenue filed applications for setting aside the abatement of the appeal, condonation of delay of 3345 days, and to implead the son of the deceased assessee as an additional respondent. The Revenue claimed they were unaware of the assessee's death until notice could not be served. However, the assessee's son provided evidence, including an application dated 02-02-2011 for waiver of interest and a demand letter dated 28-01-2013 from the Tax Recovery Officer to the assessee's wife, indicating the Department was aware of the death much earlier. The impleading petition was filed on 03-08-2016.
What were the issues?
1. Whether the appeal has abated due to the death of the assessee, and if so, whether the abatement should be set aside and the delay condoned. This issue turns on the explanation for the delay in bringing the legal heir on record and the awareness of the Revenue regarding the assessee's death. Assessee's Contentions (implied through counter-affidavit and arguments of counsel for R2): - The Revenue was aware of the assessee's death long before filing the applications for setting aside abatement and condonation of delay, as evidenced by communications from the Chief Commissioner of Income Tax and the Tax Recovery Officer. - There is no reasonable explanation for the gross delay of 3345 days in filing the applications. Revenue's Contentions: - The appeal should not abate, and the delay should be condoned as the appellant was unaware of the respondent's death until notice could not be served.
Which sections of the Income-tax Act were involved?
Section 220(2A)
AI-generated summary — verify with the full judgment below
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN & THE HONOURABLE MR. JUSTICE ASHOK MENON WEDNESDAY, THE 23RD DAY OF MAY 2018 / 2ND JYAISHTA, 1940 ITA.No. 1429 of 2009 -------------------- AGAINST THE ORDER/JUDGMENT IN ITA 15/COCH/1997 of I.T.A.TRIBUNAL,COCHIN BENCH DATED 09-08-2002 APPELLANT(S): ------------ THE COMMISSIONER OF INCOME TAX, COCHIN. BY ADVS.SRI.P.K.R.MENON,SR.COUNSEL, GOI(TAXES) SRI.JOSE JOSEPH, SC, FOR INCOME TAX RESPONDENT(S): ------------- 1. V.M. VARGHESE,
PENTA ASSOCIATES, COCHIN-31 (DECEASED) 2. PAUL VARGHESE, PROP:10 HEALTH SPA, 19-A, PALI ROAD, OPPOSITE HONG KONG BANK, BANDRA WEST, MUMBAI, MAHARASHTRA - 400 050. R2 BY ADV. SRI.M.GOPIKRISHNAN NAMBIAR R2 BY ADV. SRI.P.GOPINATH R2 BY ADV. SRI.P.BENNY THOMAS R2 BY ADV. SRI.K.JOHN MATHAI R2 BY ADV. SRI.JOSON MANAVALAN R2 BY ADV. SRI.KURYAN THOMAS THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 23-05-2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
K.VINOD CHANDRAN & ASHOK MENON, JJ. ------------------------------------------- I.A.Nos. 1976 & 1977 of 2016, C.M.Appn.No.356/2016 and I.T.A.No. 1429 of 2009 ------------------------------------------- Dated this the 23rd day of May, 2018 ORDER/JUDGMENT Vinod Chandran, J. The preliminary question raised is to whether the appeal has to be heard on merits since by reason of the death of the assessee, there is abatement of the above appeal. The Revenue has filed an application for setting aside the abatement, condonation of delay of 3345 days, as also impleading the counter-petitioner, the legal heir of the assesee as additional respondent. The additional respondent now sought to be impleaded is the son of the deceased assessee. The reasons stated in the affidavit accompanying the application for setting aside the abatement and condonation of delay are that the appellant-Commissioner of Income Tax, Kochi was not aware of the death of the respondent. Only when the notice issued to the respondent from this Court could not be served, the death of the respondent-assessee was brought to the notice of the
ITA 1429/2009 2 Commissioner and immediately thereafter, the aforesaid applications were filed. 2. A counter-affidavit has been filed by the son of the assessee, who is sought to be impleaded. Annexure R(1)(a) is an application filed before the Chief Commissioner of Income Tax, Kochi by the son of the deceased seeking waiver of interest levied under Section 220(2A) for the block assessment, which is dated 02-02-2011. Annexure R(1)(b) is a letter addressed by the Tax Recovery Officer specifically raising a demand on giving effect to the Tribunal's order dated 03-10-2002, which is challenged in the above appeal. The said demand is dated 28-01-2013. The demand has been raised on the wife of the assessee, showing the assessee as deceased. These communications make it clear that the Department was aware of the death of the assessee long before the endorsement on notice issued by this Court was received back. The impleading petition is filed only on 03-08-2016. 3. The learned Standing Counsel for the Revenue submits that the appeal is filed by the Commissioner of Income Tax, Kochi and the Annexures produced along with the counter-affidavit are
ITA 1429/2009 3 with respect to different officers. We are of the opinion that the Revenue cannot take such a contention, especially in the context of Tax Recovery Officer having send a communication to the wife of the deceased assessee specifically giving effect to the order of the ITAT, which is challenged here. The Tax Recovery Officer would necessarily have, before giving effect to the order, enquired about the further proceedings taken on the basis of the order of the ITAT and this appeal itself was filed in the year 2003. Notice was issued only in the year 2009 for reason of the appeals having not been numbered for reason of the challenge raised to the court fees applicable by way of amendment of the Kerala Court Fees and Suits Valuation Act. However, the appeals were filed in time and was pending before this Court unnumbered till 2009 and thereafter numbered. In the year 2013, the Tax Recovery Officer has implemented the order and had communicated the demand to the wife of the deceased assessee. The Department ought to have taken up the proceedings for setting aside the abatement and condonation of delay, if at all, within a reasonable period from Annexure R(1)(a) or R(1)(b). We do not see any explanation for
ITA 1429/2009 4 the gross delay caused. The applications hence would stand rejected and as a consequence, the appeal is dismissed as abated, leaving the question of law to be considered in appropriate proceedings.
Sd/- K. VINOD CHANDRAN Judge Sd/- ASHOK MENON Judge dkr
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