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Facts
The appeal was filed by the legal heir of the deceased assessee, Kishan Das Maheshwari, challenging an order passed by the CIT(A). The core issue revolves around the initiation of assessment proceedings and issuance of notices under Section 148 of the Income Tax Act after the assessee's death.
Held
The Tribunal held that the notices issued under Section 148 of the Act to the deceased assessee were invalid as they were issued after his death. Consequently, the assessment order and the order passed by the CIT(A) were set aside.
Key Issues
Whether assessment proceedings initiated by issuing notices under Section 148 to a deceased assessee are valid in law, and whether the subsequent assessment order and the appellate order are sustainable.
Sections Cited
148, 148A, 144, 68, 250
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Income Tax Appellate Tribunal, JAIPUR BENCHES,”A” JAIPUR
Before: SHRI GAGAN GOYAL, AM & SHRI NARINDER KUMAR, JM vk;dj vihy la-@ITA No. 43/JP/2025
vkns'k@ ORDER PER: NARINDER KUMAR, JUDICIAL MEMBER
Present appeal has been filed by Smt Raj Kumari Maheshwari, as legal heir of assessee-Sh. Kishan Das Maheshwari.
By way of present appeal order dated 22.11.2024, relating to the Assessment Year 2014-15 passed by Ld. CIT(E) u/s 250 of the Income Tax Act, (in short “the Act”) has been challenged. said legal representative of Sh. Kishan Das Maheshwari, and thereby directed Assessing Officer to make afresh assessment in accordance with rules.
Vide assessment order dated 30.05.2023, Assessing Officer computed total income of the assessee at Rs. 2,20,80,905/-. While so computing the income, Assessing Officer made addition of Rs. 1,67,80,135/- on account of unexplained money and while resorting to provisions of section 68 of the Act.
Arguments heard. File perused
The only ground raised by Ld. AR for the appellant in this appeal, in the course of arguments is that the notices issued u/s 148 and u/s 148(A)(b) of the Act, the order passed u/s 148A(d) and the assessment made u/s 144 of the Act are bad in law, the reason being that the assessee had expired much prior to the initiation of proceedings.
As claimed by the legal representative, Kishan Das Maheshwari died on 05.06.2019 and income tax return for the Assessment Year 2019-20 was filed through his wife - legal representative on 31.07.2020.
• Alamelu Veerappan vs. ITO, Non-Corporate Ward-2(2), Chennai [2018] 95 taxmann.com 155 (Madras H. C) • Pradeep Jain vs. ITO [2024] 164 taxmann.com 284 (Delhi H. C) • Savita Kapila vs. ACIT, Circle 4(1) [2020] 118 taxmann.com 46 (Delhi H. C) • Smt. Madhuben Kantilal Patel vs. Union of India, [2023] 148 taxmann.com 202 (Gujarat H. C.) • Smt. Bhavnaben K. Punjani vs. PCIT, [2024] 159 taxmann.com 650 (Rajkot-Trib.)
On the other hand, Learned DR for the Revenue stands by the impugned order passed by Learned CIT(A) for the reasons recorded therein.
Available at page No. 1 of the paper book dated 19.02.2025, submitted on behalf of the appellant, is a copy of death certificate of Sh. Kishan Das Maheshwari. As per this death certificate, Sh. Kishan Das Maheshwari died on 05.06.2019. Death of Kishan Das Maheshwari is not in dispute. u/s 148 of the Act relating to the Assessment year 2014-15. This notice is dated 13.05.2021.
From contents of this notice, it is evident that it was issued to Sh.
Kishan Das Maheshwari.
In other words, notice dated 13.05.2021, u/s 148 of the Act came to the issued to Sh. Kishan Das Maheshwari, who had already left this world on 05.06.2019.
Reply to the above said notice was submitted by AR-CA Sh.
Rajnikant Bhatra. Its copy is available from page No. 4 to 6 of the paper book.
Reply was submitted online on 8th July, 2021 specifying in the very first paragraph thereof that Sh. Kishan Das Maheshwari died on 05.06.2019. Copy of the certificate of Sh. Kishan Das Maheshwari was also enclosed therewith. It was also specifically alleged in the reply that notice issued in the name of deceased person was void. In support of the said submission, reference was made to decisions by Hon’ble Apex Court and different Hon’ble High Courts.
In Pradeep Jain v. ITO, (supra), Hon’ble High Court of Delhi while dealing with the same issue held that in view of the judicial pronouncements cited therein, it was crystal clear that the action u/s 148 of the Act could not be initiated as the impugned notices were issued to a dead person.
In that case, assessee had expired on 09.02.2019 but subsequently vide notices issued u/s 148A(b) of the Act issued on 31.03.2021 & 19.04.2021, the revenue sought to initiate the proceedings in the case of the assessee. Petitioner, legal heir of the assessee, informed the revenue that notices u/s 148 of the Act were issued in the name of dead person, and further that action was sought to be initiated on the old PAN.
Even then the revenue proceeded to investigate further and subsequently, on 31.03.2022 the Assessing Officer passed assessment order in the case of old PAN and on 20th July, 2022, passed an order u/s 148A(b) of the Act in case of new PAN.
Having regard to the above admitted facts and the principles which emerged from Judicial pronouncements discussed therein, Hon’ble High informed about death of the assessee, in reopening the assessment u/s 148 of the Act, was clearly reflective of the non application of mind.
Herein, as noticed above. notice u/s 148 of the Act came to be issued to the deceased assessee on 13.05.2021 on the ground that there were reasons to believe that income chargeable to tax had escaped assessment.
Even after the legal heir of the assessee apprised the revenue about death of assessee on 05.06.2019, the revenue proceeded to reopen the assessment, by issuing notice u/s 148A of the Act on 31.05.2022 and ultimately in passing the assessment order against the deceased assessee through legal heir.
Significantly, no fresh notice was issued by the revenue to the legal heir of the deceased assessee.
While dealing with the matter, Assessing Officer was required to decide the legal objection raised by the legal heir of the assessee.
However, admittedly, while passing the assessment order, the Assessing Officer nowhere discussed the legal objections raised by the legal heir as regards the validity of notice u/s 148 of the Act. said legal ground raised by the appellant while challenging the assessment order which came to be passed against deceased assessee through his legal heir without redressing her grievance about validity of the notice.
Rather, as per para 5.1 of the impugned order, Ld. CIT(A) deemed it a fit case to remand the matter to the Assessing Officer for verification of the submission of the appellant and conducting of inquiry.
The matter was not remanded with the direction for issuance of fresh notice or reassessment in accordance with law. Rather, it came to be remanded for verification on the point of a true and correct estimation of income of the appellant i.e. deceased assessee.
Having regard to the judicial pronouncements on the subject, we find merit in the contention raised by AR for the appellant that the notices issued to the deceased assessee were invalid, and consequently, the assessment order and the impugned order passed by Ld. CIT(A) deserve to be set aside.
In view of above findings, this appeal is allowed and the impugned order passed by Ld. CIT(A) is hereby set aside.
Appeal file be consigned to the record room after the needful is done by the office.
Order pronounced in the open court on 24/02/2025.