THE INCOME TAX OFFICER, AMRITSAR. vs. SH. SUNIL KUMAR, AMRITSAR.

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ITA 474/ASR/2016Status: DisposedITAT Amritsar12 April 2018AY 2007-084 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that issuing a notice under Section 148 in the name of a deceased person is illegal and void ab initio. Therefore, all subsequent proceedings are also void. The order of the CIT(A) quashing the assessment was upheld.

What were the facts?

The Assessing Officer (AO) reopened the assessment for AY 2007-08 and issued a notice under Section 148 in the name of the assessee, Sh. Sunil Kumar. The assessee had expired on June 10, 2007, a fact already recorded in a previous assessment order. The notice was served on the deceased, and subsequent proceedings were conducted without the legal heir's participation.

What were the issues?

Whether an assessment proceeding initiated by issuing a notice under Section 148 to a deceased assessee is legally valid.

Which sections of the Income-tax Act were involved?

Section 148,Section 250(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR

Before: SH. SANJAY ARORA & SH. N.K.CHOUDHRY

Hearing: 09.04.2018Pronounced: 12.04.2018

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE SH. SANJAY ARORA, ACCOUNTANT MEMBER AND SH. N.K.CHOUDHRY, JUDICIAL MEMBER ITA No.474(Asr)/2016 Assessment Year:2007-08

Income Tax Officer Vs. Sh. Sunil Kumar Ward-5(5), Amritsar Through L/H Smt. Achla Kumar 1, Rai Bahadur Parkash Chand Road, Amritsar PAN:ACZPK7039C (Appellant) (Respondent) Appellant by: Sh. Rajeev K. Gubgotra (Ld. DR) Respondent by: None Date of hearing: 09.04.2018 Date of pronouncement: 12.04.2018 ORDER PER N.K.CHOUDHRY, JM: The instant appeal has been preferred by the Revenue Department, on feeling aggrieved against the order dated 03.06.2016 passed by the Ld. CIT(A)-2, Amritsar, u/s 250(6) of the Income Tax Act, 1961 (hereinafter called as ‘the Act’).

2.

The following grounds of appeal raised by the Revenue Department.

“1. Where the Ld. CIT(A) is right in quashing the assessment order ignoring the facts on record that the assessment was completed in the name of assessee through Legal Heir.

ITA No.474/Asr/2016 (Asst. Year: 2007-08) 2 ITO vs. Sh. Sunil Kumar, Amritsar

2.

The Appellant craves leave to add or amend the grounds of appeal on or before the appeal is heard and disposed off. 3. It is prayed that the order of the Ld. Commissioner of Income Tax (Appeals)-2, Amritsar be set aside and that of the AO be restored on merits. ”

3.

In the instant case, the assessment relevant to Asst. Year: 2007-08 was reopened u/s 148 of the Income Tax Act, 1961 (hereinafter called as ‘the Act’) and the notice dated 11.03.2014 u/s 143 was issued in the name of the assessee which alleged to be duly served on the assessee on 13.03.2014 and thereafter, many notices have been issued in the name of the assessee, however, none appeared on behalf of the assessee and in that eventuality, the Assessing Officer after taking into consideration of relevant material available on record opined that it is established the amount of Rs.38,25,312 has been invested in mutual funds by the assessee during the Financial Year: 2006- 07 relevant to 2007-08 from his undisclosed source and the same was added to the taxation income of the assessee treating as income of the assessee from undisclosed sources.

4.

The assessment order was challenged by Smt. Achla Kumar wife of the assessee on the ground that the assessee was expired on 10.06.2007 and therefore, had not filed any Income Tax Return for Asst. Year: 2006-07 and the assessment order of Asst. Year: 2006-07 u/s 143(3) dated 05.12.2008 duly records the facts of his death which goes to show that the Revenue Department was aware of the death of Sh. Sunil Kumar, (the assessee) herein, however, the notice u/s 148 was issued in the

ITA No.474/Asr/2016 (Asst. Year: 2007-08) 3 ITO vs. Sh. Sunil Kumar, Amritsar

name of Sh. Sunil Kumar (deceased) on 11.3.2014 and therefore, questioned as to how a notice can be served upon a dead person. Further, it was argued by the appellant that no notice was ever issued by the AO in the name of the appellant herein as legal heir of late Sh. Sunil Kuamr, hence, could not attend the assessment proceeding or file her objections. Further, it was also argued that AO was erred in assuming jurisdiction by issuing notice u/s 148 in the name of dead person which is illegal and void ab initio, and hence, liable to be quashed.

5.

The Ld. CIT(A) accepted the contention of the appellant and passed a reasoned order, however, the Revenue Authority preferred the instant appeal and in support of its case, it was submitted that Ld. CIT(A) was not right in quashing the assessment order ignoring the facts on record that assessment was completed in the name of the assessee through legal heir and prayed for setting aside the order passed by the Ld. CIT(A) and restoring the same to the AO to be decided on merit.

6.

We have gone through with the facts and circumstances of the case and rival submissions of the parties, as in the instant case, it is not in dispute that the assessee had expired on 10th June, 2007 and factum of the same have duly been recorded in the assessment order qua Asst. Year:2006-07. However, reason best known to the Assessing Officer, the notice u/s 148 was

ITA No.474/Asr/2016 (Asst. Year: 2007-08) 4 ITO vs. Sh. Sunil Kumar, Amritsar

issued in the name of the deceased assessee, which is not refuted and/or denied by the Revenue Department and it is settled law that assuming jurisdiction by issuing a notice u/s 148 in the name of dead person itself illegal and void ab initio, therefore, we are of the considered opinion that once the notice indisputably has been issued in the name of dead person, in that eventuality, the proceedings in pursuance thereto shall tantamount to void ab-initio and do not have any stand in the eyes of law. Hence, on the aforesaid analyzation, consideration and observation, we are of the considered opinion that the order passed by the Ld. CIT(A) do not suffers from any illegality, perversity and impropriety and therefore, we uphold the same.

7.

In the result, the appeal filed by the Revenue Department stands dismissed. Order pronounced in the open Court on 12.04.2018.

Sd/- Sd/- (SANJAY ARORA) (N.K.CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 12.04.2018 /PK/ Ps. Copy of the order forwarded to: (1) Sh. Sunil Kumar Amritsar (2) The ITO, Ward-5(5), Amritsar (3) The CIT(A)-2, Amritsar (4) The CIT concerned. (5) The SR DR, I.T.A.T., Amritsar True copy By order

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